Question

Competing in one or more countries or regions of the world causes the strategy-making to be more complex partly because of

A) the difficulties of determining the optimum price to charge for the company's product/service in each of the different countries where the company decides to compete.
B) the risks of adverse shifts in currency exchange rates and the presence of important cross- differences in buyer tastes, market sizes, and growth potential.
C) the need establish plants, distribution facilities, and sales operations in each country in which a company competes
D) the added time and effort it takes to design and execute strategies to create a sizable profit sanctuary in each country where if chooses to operate and then to develop strategies to defend all these sanctuaries against the guenlla offensives of local rivals desirous of stealing company's most profitable customers.
E) imperatives of crafting and executing a completely different competitive strategy for each different country in which a company competes.

Answer 1

Competing internationally increases complexity due to the need for price optimization, adaptation to cultural differences, establishment of operations, and the strategic management of global competition influenced by globalization.

Step-by-step explanation:

Competing in international markets involves complexities due to several factors. One such factor is the difficulty in determining the optimal pricing strategy for a company’s products or services in different countries, taking into account variations in currency exchange rates, income levels, demand elasticity, and local competitive situations.

Another complexity arises from the need to adapt to cross-cultural differences in consumer tastes, as well as to address differences in market sizes and growth potential across regions. Companies must also consider how to efficiently establish and manage their operations abroad, whether through physical presence or strategic partnerships.

Finally, there's the strategic challenge of creating and defending profit sanctuaries by competing effectively against both global and local rivals. Globalization amplifies these challenges as firms must navigate additional competitive threats from firms in medium-income countries with lower production costs and firms in higher-income countries with advanced technologies. Dynamic comparative advantage and economies of scale become critical strategic considerations in such a competitive landscape.