push and pull factors

Question 1

what are push factors

Answer 1

motivate a firm to look at business opportunities in other countries
push business away from domestic business
may be struggilign to increase proficibilaity or survive in current market

Question 2

what are twoo examples of push factors

Answer 2

ssaturation-saturated market, where all consumer demand is beingmet

crowed and little chance for growth

may want to locate in unstaured oversea makrtes to increase sales

competition-high levels of comp can affect profitbtibilty therefore forcing a business to go abroad

chnges in govermentmets plicies-if taxes rise, amy also force businesss to go abroad

Question 3

what are pull factors

Answer 3

something which makes it attractive for a business to trade abroad

Question 4

examples two pull factors

Answer 4

spreading of risk-if spread in more counteries, then if sales decline in one coutnry, wont affect the business as much
more it spreads it risk, the more stable it will be

economies of scale-ahcive global econimues of scale, reduce their unit costs expanding abroad. strong pull factor for firms that need global economies of scale in order to survive and grow

Question 5

other pull factors

Answer 5

lower production cots
cheaperr raw materials
cheaper labrour
higher avalibility to resources

Question 6

moving abroad can extend products life cycle

Answer 6

product may be in declining stage in domestic makret but growth stage in emerging market