Which strategy for MNEs is best for environments where there are clear differences between the home and foreign markets and there is a low pressure for cost reduction?
A) Home replication strategy
B) Localization strategy
C) Global standardization
D) Asset allocation

Question

Quizplus · Accepted Answer

In environments where there are clear differences between the home and foreign markets and there is low pressure for cost reduction, the localization strategy is most suitable. This strategy allows companies to modify their products, services, and marketing strategies to fit the unique needs and preferences of local markets, which can help them gain a competitive advantage and increase their market share. Home replication strategy and global standardization are better suited for environments with high pressure for cost reduction, while asset allocation is a general strategy for managing a company's assets and resources. In environments where there are clear differences between the home and foreign markets and there is a low pressure for cost reduction, the localization strategy is the most appropriate option. This strategy involves adapting products, services, and marketing to meet the specific needs of each local market, rather than imposing a standardized approach. This allows MNEs to better cater to the unique preferences and tastes of consumers in each foreign market, while also maintaining a competitive edge. The other options, such as home replication strategy and global standardization, may not be as effective in such environments, as they do not account for the differences in local market conditions.

Which Strategy for MNEs Is Best for Environments Where There