Final answer:
Domestic businesses go international to combat protectionism through agreements, react to increased global market awareness, stay competitive against international firms, provide better or cheaper products to consumers, find flexibility in varying environmental standards, and address national security concerns about over-reliance on imports.
Step-by-step explanation:
Domestic businesses may decide to venture into international operations for several reasons. Here are six compelling ones:
- International agreements can provide a counterbalance to domestic pressures and prevent protectionism, which can hinder growth.
- Global market awareness is increased due to reductions in trade barriers and advances in transportation and communication, prompting businesses to expand their reach.
- Competition from international firms can threaten domestic profits and jobs, pushing companies to enter global markets to remain competitive.
- Consumer benefits from international trade include access to superior or more affordable products, driving domestic businesses to adapt.
- Environmental standards variations can lead some companies to relocate production, thereby creating global operational flexibility.
- Security concerns regarding over-dependence on imported products may drive a country to support domestic businesses to expand internationally.
Each of these factors can significantly influence a company's strategic decision to transition from domestic to international operations, reflecting the complexity and interconnectedness of global trade.