Question

Scale efficiencies are the cost advantages that enterprises obtain as fixed costs are spread out over more units of output. But some companies sacrifice scale efficiencies for responsiveness to local conditions. In these companies, country managers understand local laws, customs, and tastes and can decide how to meet them and increase sales. This global strategy is called

Answer 1

Answer: multi-domestic strategy

Explanation:

A multi-domestic strategy refers to a strategy whereby a company responds to the local market by making and customizing their product in order to match the different national conditions.

The strategy enables the multinational's individual subsidiaries to be able to compete independently in the domestic markets. An example of a multidomestic company that uses the multidomestic strategy is Nestlé which utilizes its marketing approach for the markets where it operates as it tastes is based on the needs of the people in the country.