GLOBALIZATION

Globalization: is the free movement of goods, services and people across the world in a seamless and integrated manner. Globalization can be thought of to be the result of the opening up of the global economy and the concomitant increase in trade between nations. In other words, when countries that were hitherto closed to trade and foreign investment open up their economies and go global, the result is an increasing interconnections and integration of the economies of the world. This is a brief introduction to globalization.

Further, globalization can also mean that countries liberalize their import protocols and welcome foreign investment into sectors that are the mainstays of its economy. What this means is that countries become magnets for attracting global capital by opening up their economies to multinational corporations.

Globalization is the expansion of local economies and businesses into a broader, international marketplace. Even small businesses have gotten active in the global environment as the Internet and mobile technology have enabled communication across continents and countries. Globalization has become important for a number of reasons, including the overall need for businesses to compete.

The Internet

The Internet revolutionized the business arena, because it created a whole new virtual marketplace that expands beyond physical and geographical boundaries. Companies in foreign countries can now compete for customers in the world wide by leveraging their own country's resources, lower costs of labor and affordable distribution processes. In the same way, companies have the opportunity to appeal to customers in other countries by promoting goods online.

Developing Nations

The development of business, industry and income levels in several large population centers has also contributed to the importance of globalization. For example, China, India and Brazil are prominent examples of thriving economies as Nearly two billion people reside in these countries. As customers gain buying power, U.S. companies race for the all-important capital that their revenue dollars can provide. Partnership opportunities with businesses in these countries can aid growth.

IMPORTANCE FOR THE COMPANY TO ENTER IN GLOBAL BUSISNESS

Competition

Even if you want to avoid the globalization movement, you often have no choice but to compete. The influx of foreign competitors in global limits the number of companies in some industries that can succeed domestically. In the same way, if your competitors expand globally, you have to consider following suit. Any money other companies make in foreign markets; they can bring back to the country and invest it in promoting their brands, products and services domestically.

Diverse Populations

Business trends often mirror broader societal trends. The global companies and the world in general, have become very diverse. The power country like U.S is a home to immigrants from many countries around the world. As people move to different parts of the world, they spread different ideas, perspective and customs. Foreign-born citizens who work for and buy from U.S. companies often want to see them get involved in doing business in other parts of the world.

Finally, the global economic crisis has undone the many gains that have been made by globalization and hence there are renewed calls for protectionism and for erecting trade barriers in the West as well as in the East. This means that the global economic crisis has dealt a body blow to the global economy which might take years to regain its earlier prosperity.

BY MDODO REBECCA, J

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