Northampton-Based Organisation Wishes Expand Market Internationally

Strategy of International Trade

A firm may decide to operate internationally due to a wide variety of reasons. These reasons include but are not limited to market imperfections at home, gaining market power and favourable environment overseas. In order to operate internationally, firms need an appropriate strategy so that their resources are put to best use and the whole process of internationalization proceeds according to plan. (Twarowska and Kakol, 2013)

There are two ways of entering an international market, equity-based entry and non-equity-based entry. The former gives high return on investment and market control but it has high risk associated with it. The latter does not give sufficient market power nor high rate of return but it is volatile and minimizes the risk. (Twarowska and Kakol, 2013)

The first and the least risky method to trade internationally is engaging in import and export. Using...
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