Management Essay Example: International Facilitation of American Companies

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University of Richmond
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Today, the significance of running any business is to enhance and provide goods and services to the customers in a process that is profitable to the producers. Production and operations management discusses applying business association and administration of ideas in the manufacture of merchandise and enterprises. It as well involves consumers' benefits and ways to help solve their problems concerning business. However, international operations consist of business operations in international centres. For any organization planning over venturing into another market, the favourable circumstances and drawbacks of setting up a branch rely upon the firm openings, and also the social and administrative atmosphere of the particular nation. The purpose of this research is to explain reasons and implications for American Companies to move their facilities to other countries and why international companies would want to run business in U.S.

An ever increasing number of organizations have extended exports from their plants at home; authorized licenses and procedures to foreign producers in return for eminences or a share of benefits; or built up supporting organizations or branch industrial facilities abroad. Organizations have realized significant reserve funds in corporate taxes by channelling their profits through overseas to nations that have a more indulgent duty administration for businesses than the U.S. does. Reincorporating a firm in countries, for example, Bermuda, which taxed companies at zero percent in 2012, can appear like an appealing alternative when confronted with higher rates at home.

Organizations may likewise have the capacity to secure less expensive land and natural resources in nations other than the U.S. Organizations once in a while set up operations abroad to drive development. Opening an abroad office helps a company achieve a brand new market where demand for its items and services is high, and competition is minimal. It likewise helps the United States organizations increment their image acknowledgment all through the world. Moving to a nation with less or more relaxed regulations may enable an organization to innovate, grow and take risks more effectively than it could at home.

On the downside, opening a production office in an outside nation offers a component of instability. American organizations that are used to a moderately stable government might be in for a reality check on the off chance that they work in a country where political administration changes much of the time. This shift can lead to the financial upheaval that can risk the business' long-term success. American organizations that use producing sites in different nations might be seen as giving residential occupations to foreign labourers', which can prompt a negative public image.

Several foreign companies have expanded their business for the last few decades in the United States. They have enhanced an increase of approximately 5000 jobs in America. However, several factors attract foreign companies to set up business in U.S. The United States is a political, monetary and infrastructural centre in an uncertain world. America profits by modest, ample, and dependable vitality guaranteeing production facilities can be continued running continually. For example, the Chinese textile film recently started a cotton mill in U.S South Carolina despite that China had low production costs. Foreign films are up to counterbalance the cost of work. American employees' work for longer hours and smothered wages. The U.S. is likewise home to several states where union portrayal is little and labourers are not limited to a single errand yet rather can set up, work, and run different machines. In any case, even with a wage difference between the U.S. as well as low wage nations, the difference is more than adjusted for by different reserve funds.


Various business in the esteem chain, in any case, are attached neither to clients nor assets yet rather are versatile; they can be set in any of various areas and moved as conditions change. Inquire about, programming improvement, and generation of merchandise with modest transportation costs, for instance, can be found anyplace. Versatile services incline toward the area that enables them to be performed in a most successful and at the least production cost.



Aswathappa, K., et al. (2010). Production and operations management. Mumbai [India: Himalaya Pub. House.

Oakey, R. (2009). The production and distribution of knowledge. Bingley: Emerald Group Pub


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