Businesses can communicate and trade in one or a number of different countries; but what’s the difference between National, International, Multinational, Global and Transnational?
National organizations have a base in one county e.g. the UK and only communicate and trade within that one country.
International organizations have a base in one country e.g. the UK, but communicate and trade to other countries, including its own.
Multinational organizations have a base in more than one country and each base is working and trading independently to each other i.e. they build, market, sell and distribute within each separate country.
A global organisation has multiple bases in multiple countries, but the manufacturing and distribution occurs in central points across the globe and products are shipped between countries.
Transnational organisations have a global set up i.e. multiple bases and cross county distribution, however individual bases such as the UK and France may work together if the British and French audiences have similar needs. This takes advantage of best practices and economies of scale within each country.
Business Growth Strategies
All businesses need to start somewhere, which is usually as a national supplier, overtime they can grow ‘organically’ i.e. develop naturally as they take on more customers. There will however be a limitation to their organic growth and this is when they may decide to adopt a new growth strategy, such as:
1. Diversification, which is supplying to new markets e.g. a new country, thus making you an international organization. This could be by adapting an existing product to suit that new markets need, or by developing a brand new product. This is discussed in more detail in our New Product Development article.
2. Horizontal integration e.g. buying a competitor or manufacturer at the same level as you in the supply chain; this allows you to reach your new markets.
3. Vertical integration e.g. buying a competitor or manufacturer at a higher or lower place than you in the supply chain; again allowing you to reach your new markets.
Your business’s growth strategy heavily affects your marketing plan and the marketing mix you decide to use, so understanding these growth strategies will be key to an organizations marketing success.