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Globalization and its Impact on Global Markets

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Globalization has several facets but mainly it deals with the globalization of markets and products. As far as globalization with respect to markets is considered, it is basically referred to as the merging and integration of distinct markets into one huge marketplace at the world level. It is widely considered that the preferences, trends, tastes, and behavior of consumers in different nations provide an initial base to converge the market on some sort of a single norm and thus assist in developing the global market. Coca Cola soft drinks, burgers of McDonald's, coffee of Starbucks, credit cards of Citigroup, furniture of IKEA, and video games of Sony PlayStations are some leading examples of this trend.

By offering a universal product, the companies actually form a global market. In order to gain the benefits of international investments, it is not necessary for a company to be of the same strength as the multinational companies, e.g. in the USA, almost 90% of the firms, which make foreign investment at a global scale, don’ t have more than 100 employees while their market share has been rising for last ten years and now has crossed 20% of the overall market share (World Trade Organization, 2009).

Similarly, 97% of US exports are associated with firms having to strength less than 500 workers (U. S. Department of Commerce, 2000), e.g. B& S Aircraft Alloys, a New York-based company has almost 40% exports from its $8 million annual revenue while Hytech, another company of New York, also has 40% exports from its $3 million annual earnings by investing into five countries. In Germany, almost 98% of companies, both small and large ones, are dealing with international trade either through production or exports (Draffin, 2001).

Although Coca Cola, McDonald's, Pizza Hut, Starbucks, IKEA, and some other companies have dominating influence on international markets, even then there are certain differences which still persist with respect to various dimensions. It includes consumer behavior like preferences and taste, cultural values, distribution channels, business systems, and legal regulations.  

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