Expansion strategies in international markets: An exploratory study

Introduction A common observation is that firms often cross their domestic borders to do business abroad. The reasons for doing so are multiple. A key explanation of such behaviour can be found in the firm's market de~r~le~,xe. More generally, firms, l ~ other organizations, are often conceived as"open systems". According to the open-system metaphor they (firms) are influenced by their surrounding, ever-changing environments and they, through their own actions, may influence these environments as well (cf. Thompson, 1967). A prerequisite according to Pfeffer and Salancik's (1978) open-system perspective (or metaphor) is that the firm (like any organization) must be effective in order to survive and prosper, i.e. the firm must be able to satisfy its external constituencies in such a way that its costs am covered (at least in the long run) and excess profit is preferable: