Market Your Way to Growth: 8 Ways to Win

5 Grow by International Expansion

Why did you rob banks? Well, that's easy to answer. That's where the money is.

—Willie Sutton

Most companies in a country start by selling something there. This is true of the local shoemaker, clothier, candy maker, and food producer. If the country is very large, businesses can grow and continue as essentially domestic producers. This happened in the United States, which grew for a century principally on its vast domestic market. In a small country, some producers might eventually try to make or sell something to one or more other countries. Certainly, if a business can make more money selling abroad than it can selling at home, it should seriously consider doing business in other countries. This can take two forms: (1) establishing your business abroad by foreign direct investment or (2) exporting your goods and services from your home market to international markets.

Engaging in Foreign Direct Investment

Most large American companies and many midsize and small firms have chosen the foreign investment route and have established foreign subsidiaries. The dominant purpose for starting operations abroad is to exploit domestic sales opportunities in new growing markets. Many emerging countries have large populations and high population growth rates of people who need shoes, clothing, furniture, and appliances among other things, as well as local manufacturers who need foreign machinery and equipment. These emerging countries need to improve their ...