There are several reasons why companies engage ininternational business.
I think the main reason is for company growth. Another reasonfor engaging in international business is to widen your customer base whichwould increase sales for the company. By increasing sales, you are alsoincreasing the company’s profits. For example, a movie like Star Wars: The LastJedi costs millions of dollars to produce; however, as more people watch themovie, the production cost per viewer decreases.
There will be more competitionso companies could raise their prices in some markets. You are also minimizingyour company’s risk when you expand internationally. It is similar todiversifying your portfolio, you are spreading the risk across countriesinstead of putting all your eggs into one country. If one country’s marketcrashes, you will still be fine because the other countries your company isdoing business in are fine.
Companies would have short-term and long-termsecurity by engaging in international business. You would also have access tomore resources, either new resources that you cannot get in the United Statesor cheaper alternatives for the resources you are already using. Theseresources could be anything from minerals to fabric. By engaging in internationalbusiness, companies also will have more alternatives for cheaper labor. Whetherit is for manufacturing, customer service, tech assistance, or other types of services,there are always people looking for work. Companies will also come up with newideas for products or services when they expand internationally because of thenew cultures and backgrounds they are introduced to. Other cultures might needsomething that the cultures in the United States do not need or already have.
Engagingin international business also provides challenging business opportunities forcompanies. I believe that you always need to be challenged so that you cangrow. Companies don’t need to be complacent where they are now. If they are,then they are more than likely going to be left behind.