Advantages and Disadvantages: Multi-domestic, Global, or Transnational Strategy
Part 1
A transnational strategy is an approach that companies most companies use to enter foreign markets successfully. Toyota is an excellent example of a company that has succeeded by using a transnational strategy to enter international markets such as the US, Indiana, and Canada (Hagiu & Clipici, 2009). Toyota decided to enter the US market using a transnational strategy. It built a subsidiary company in California. Toyota is globally recognized for its innovativeness, which makes it manufacture high-quality cars. The company made sure that it invested enough in research and development in the US market (Hagiu & Clipici, 2009). It also established divisions such as manufacturing and sales and marketing in the United States. Using American workers as well as suppliers, helped Toyota Company to master well US markets. The company utilized knowledge gained from marketing and selling its products in US markets to manufacture quality cars (Lazzari, 2019). Its transnational strategy succeeded, and this made the company gain a significant market share in America.
Part 2
Using a transnational strategy has greatly helped Toyota in entering foreign markets successfully. The number of cars, as well as trucks the company sells in North America, is more than that it sells in Japan. Additionally, global profits the company gains from North America are above 60% (Lazzari, 2019). Even though the company invested a lot of money for this strategy to work, it gained tremendous benefits in the long run. In my opinion, choosing this strategy to enter foreign markets was a wise choice that Toyota made (Lazzari, 2019). For instance, penetrating into US markets helped the company to improve some of the areas that needed change, including its relationship with its suppliers, together with increasing its competitiveness both locally and in international markets.
References
Hagiu, A., & Clipici, E. (2009). The internationalization strategy in a global age. In The International Conference on Economics and Administration, Faculty of Administration and Business, University of Bucharest, Romania ICEA-FAA Brucharest.
Lazzari, Z. (2019). What Is a Transnational Business Strategy? Chron. Retrieved on 15th May 2020 from https://smallbusiness.chron.com/transnational-business-strategy-20950.html