Firms pursue internationalization strategies for a variety of reasons. Some motives are strategic in nature, while others are reactive. An example of a strategic, or proactive, motive is to tap foreign market opportunities or acquire new knowledge. An example of a reactive motive is the need to serve a key customer that has expanded abroad. Nine specific motives include:
Seek opportunities for growth through market diversification;
Earn higher margins and profits;
Gain new ideas about products, services, and business methods;
Better serve key customers that have relocated abroad;
Be closer to supply sources, benefit from global sourcing advantages, or gain flexibility in the sourcing of products;
Gain access to lower-cost or better-value factors of production;
Develop economies of scale in sourcing, production, marketing, and R&D;
Confront international competitors more effectively or thwart the growth of competition in the home market;
Invest in a potentially rewarding relationship with a foreign partner.