![]() ![]() ![]() Let’s examine the stabilizing factor globalization has had on the world economy. At some point in the near to mid-term, I believe we’ll see a shift in markets that unwind much of the current stability driving our current frothy capital markets and business expansion. I mentioned a 3 – 5-year window above, but like anyone who looks forward, this is just my best guess. ![]() Here’s the trick – markets don’t go up forever, and when you tie your fortunes to a broader set of variables and unknowns you expose your business to the potential for a domino impact that will work against you. The above referenced worldwide macroeconomic maturation, more commonly referred to today as “Globalization,” has served to stabilize business and financial markets in such a dramatic fashion that many industry pundits have yet to reach an understanding of the depth and breadth of the impact it has had on lowering political, financial, and economic volatility. The broad macro-economic effects of globalization being experienced today arguably became most identifiable with the end of the cold war, and have only continued their rapid advancement with the development of third world countries and other emerging markets, the establishment of free trade agreements, the creation of the Internet and other technology/communications improvements, the growing multi-national footprint of the business, the emergence of the European Community, the stabilizing impact of the Euro on global currency markets, as well as the increased liquidity of more sophisticated and efficient capital markets. In fact, it has been creeping up on us since the dawn of time it just hasn’t been so visibly impactful until recent years. The phenomenon of “Globalization” is not new. Being a slow adopter in today’s world could eventually damage your business. As consumers continue to become more demanding and the world economy continues to flatten there will soon be an expectation that you be able to serve multiple markets in a seamless fashion. They will not only take a first mover’s advantage of securing customer loyalty and brand recognition, but they will also tie-up key partners and distribution agreements. ![]() So if you could double, triple or quadruple your revenue why wouldn’t you aggressively pursue that goal? Now consider the downside of not going global – if your company is not pursuing those customers your competition will be. In examining the upside of going global, consider the sheer size of international markets as contrasted with the size of the domestic market and you will likely find that the majority of your potential customers live abroad. In today’s marketplace conducting business internationally is as much of a defensive play as an offensive play. That said, and with eyes wide open, if you are not taking aggressive steps to expatriate your business then you may be making a big mistake. Short term opportunity abroad abounds, but with that opportunity comes the potential for unforeseen future risk. Here’s the caution – times change and markets are fluid. Currently, globalization is a developing and stabilizing force, but I’m fearful that the interdependencies now shoring up some of the risks, may at some point down the road turn against us in the form of financial ripple turns Tsunami. I believe we’re in an environment where we have a short window (3 – 5 years) before the landscape changes again. In today’s post, I’ll look at the impact of globalization on business.Įxpanding the geographic footprint of your business has always been an expensive and risky proposition – the risks have not gone away, they’ve just shifted. The ability to conduct business internationally is an absolute necessity if you hope to remain competitive in today’s marketplace. However, the days of doing business abroad are no longer a luxury. Conducting business on a global basis has always been of great personal interest to me, and it has also been both a pleasurable and financially rewarding experience. I have traveled to more than 22 countries and have had the opportunity to transact business in various parts of Asia, the Middle East, Canada, Central, and Latin America, Russia, and former Eastern Block countries, India, and the European Community. ![]()
0 Comments
Leave a Reply. |
AuthorWrite something about yourself. No need to be fancy, just an overview. ArchivesCategories |