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Motives for Internationalisation and Factors That Companies Must Consider Before Expanding Abroad- a Literature Review

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ABSTRACT

In recent years, many companies have increased their presence in the international market. This paper studies the companies need for internationalisation as it focuses on the factors companies must consider before entering new markets or expanding abroad. Many factors that lead companies to invest in the international market have been identified. The research is based on theories. Internationalization factors that motivate companies to establish themselves abroad will be included in the theories. The identified categories include of resource, market, strategic resources, efficiency and seeking motives. Network seeking motives has been identified as an additional motive. The research was conducted based on the qualitative approach. Existing information of related to the motives for internationalisation and the factors to consider before internationalisation were used. The secondary material includes peer-reviewed journals, international business books and research papers. A case study of Chrysodalia Ltd was used to explain the PESTEL and SWOT analysis. Based on the case, it is concluded that companies internationalised in order to increase their competitive advantage. Companies rely on factors, which include Resource seeking, Market seeking, Efficiency seeking, Strategic asset seeking to create competitive advantage in an already saturate market. The factors that the company should consider before internationalising are proactive motivations such as home factors, external factors, and product factors in additional to target nation production factors, target nation environmental factors, and target market factors.

Table of Contents
ABSTRACT 2
Need and Significance of the Study 4
Goals of the Study 5
Rationale of the Study 5
Literature Review 6
Regional Differences 7
Understanding Local Consumers 9
Differentiation and Capability 10
Industry

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