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2) Companies expand and enter international markets to gain market share, maintain a sustainable competitive advantage over rivals and competitors, invest in research and development along with new product introduction, and alleviate the effects of intense competition and saturation faced in their home markets

Question

  1. Companies expand and enter international markets to gain market share, maintain a sustainable competitive advantage over rivals and competitors, invest in research and development along with new product introduction, and alleviate the effects of intense competition and saturation faced in their home markets
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Solution

Companies decide to expand and enter international markets for several reasons:

  1. Gain Market Share: By entering new markets, companies can increase their customer base and hence, their market share. This is especially beneficial for companies whose home markets are saturated or highly competitive.

  2. Maintain Competitive Advantage: International expansion can help companies maintain a competitive edge over their rivals. This can be achieved by accessing new technologies, resources, or knowledge that may not be available in their home market.

  3. Invest in Research and Development (R&D) and New Product Introduction: Companies can leverage international markets to invest in R&D and introduce new products. This can help them stay innovative and relevant in the global market.

  4. Alleviate Effects of Intense Competition and Saturation in Home Markets: If a company's home market is highly competitive or saturated, international expansion can provide new growth opportunities and reduce dependence on the home market.

In conclusion, international expansion can provide companies with new opportunities for growth, innovation, and competitive advantage.

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