December 13, 2009

Multi Domestic Strategy

One of the global strategy used by global businesses in the market is the multi domestic strategy. What exactly is the multi domestic strategy?

According to Wikipedia:

Multi domestic strategy is a strategy by which companies try to achieve maximum local responsiveness by customizing both their product offering and marketing strategy to match different national conditions. Production, marketing and R&D activities tend to be established in each major national market where business is done.

In other words, this strategy involves the production of business within the locality. The innovation comes after it has been molded and develop in a local level. There is a decentralization, this decentralization resulted to local outsourcing.

This kind of startegy responds to the needs of the people within the locality of every nation wherein the business operates. However, one of the advantage of using this kind of strategy is the high costs of production of business on its local outsourcing. The production cost will vary with each outsource and you cannot guarantee a good response in each locality.

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