Question

Which of the following environments are optimal for a localization strategy? Select one: a. When pressures for local responsiveness are low and pressures for cost reductions are high b. When pressures for local responsiveness and cost reductions are both high c. When pressures for local responsiveness and cost reductions are both low d. When pressures for local responsiveness are high and pressures for cost reductions are low e. When pressures for local responsiveness and cost reductions are both moderate

Answer 1

Answer:

d. When pressures for local responsiveness are high and pressures for cost reductions are low.

Explanation:

If a company wants to go into localised strategy, it will focus on selling it's products to the local market.

Globalisation is when products are sold accross different countries.

An ideal environment for localisation is when pressures for local responsiveness are high and pressures for cost reductions are low.

There has to be a demand for the product locally for localisation strategy to work.

However there is increased cost as a result of localisation. This is because we have a more narrow market to convince to buy the product. The variety of the global marketakes it easier to sell as more people are willing to buy the product.

For example Toyota has more sales worldwide than it does locally in Japan. This is because there is lack of variety in the local market.

So pressure for cost reduction in the company should be low, because it will cost more to sell locally.