Test Bank for Global Business, 3rd Edition : Peng

Company CC has been existed since 1892.It is looking for new emerging growth markets. Country A has been the best region which resulted company CC for around 29% of its market share.CC has an ability to perform street campaigns for reaching towns and villages that helped them to improve their marketing and distributions centres.

The company CC is showing keen interest in the region A. The credit for this strong interest goes to both pull and push effect.

Push effect pertains to the following:

• The company is in a need to find new sources of growth.

• The sales of the product offered by the company are declining in the home country.

• The home country is proposing to tax the product.

• In other parts of the world it cannot make profits either because of the similar level of sales or tough competition.

• Per capita consumption of the product in some part of the world has already touched the saturation level.

Pull effect pertains to the following:

• In the region A, the company CC has a commanding market share compared to its competitors.

• Disposable income for the region as a whole is increasing.

• Per capita consumption of the product can be easily increased in this part of the world.

• The company is hoping to capitalize on the improved political stability and physical infrastructure of the country.

• Company’s operations can run smoothly in this region.

Conclusion:

Moreover, as discussed Company CC seeks new opportunities to attain growth as most of their market, outside the country A has been matured, saturated, declined or experienced increase competition. Also, A’s income, infrastructure and government has been improving day by day. Hence, for this reasons Company CC has shown interested in country A.