Friday, September 17, 2010
Many people wonder whenever they hear of somebody moving a business overseas. They often wonder at the reasons behind the move. Reasons for moving a business overseas may either be good or bad. These reasons can be categorized into three:
1) Opportunities – often, people move their business overseas because of an opportunity. Opportunities are events which, when reacted to properly, can cause the improvement of a business. People often need to look very far in order to find opportunities. Sometimes, opportunities can be found overseas.
One common reason why people move their business overseas is an open market. There are times when people have a hard time with a business because of competition. Because of competition, people often lose a lot of cash. A good entrepreneur, however, will not give up because of competition. He will look for new opportunities and new markets where he or she can dominate. People moving their business overseas often do so for the reason that their business may not have a lot of competition over there. They might move their business overseas because they see a potential market for their product which they can dominate.
Another opportunity is a reduction of costs. Some people move businesses overseas because doing so will increase their profit. Think of Nike and Adidas. These companies have factories in Asia because of the fact that labor can be much cheaper there. This means that their profits will increase by moving their business overseas.
2) Threats – there are people who move their business overseas because of the fact that there may be some threat in their current location. As said before, most move because of heavy competition. This is a threat. If you say that this example is not really distinguishable from the first reason then you should be enlightened. In the first reason, an entrepreneur sees a new opportunity in another place and therefore moves the business overseas to take advantage of that opportunity. When facing a threat, an entrepreneur moves the business overseas because not doing so could spell doom for the business.
Threats are events in the environment which, when not handled properly, can cause very bad things to happen to a business. Often, moving a business overseas can be the best way to evade those threats.
3) Miscellaneous – there are people who move their business overseas for no apparent reason connected to the business. If moving the business overseas does not take advantage of an opportunity or does not really get rid of a threat, then moving the business overseas must be for a reason related to the entrepreneur.
There are times in a person’s life that he just wants a change. He might want to feel the thrill of starting a new life. We all know, however, that people cannot just move without some means of supporting themselves. Sometimes, moving a business overseas can just be a part of the person’s migration.
Moving businesses overseas may seem like such a random thing to do. However, you need to understand that everything has a reason. It may not be understandable by other people, it may not be very smart, it may not even be reasonable, but it is there. By knowing the reasons for moving a business overseas, we are given a glimpse into a person’s mind and that is a small part of knowing the entire universe.