Please rate the following objectives according to their importance in motivating an expansion of your international business presence.

Revenue Growth Rated the Most Important Motivation for International Expansion --- Far Above Cost Reduction ...

In perhaps the most notable finding of this survey, respondents highlighted new markets/revenue growth – i.e., demand – as their primary motivation, rather than the traditional "supply-oriented" paradigm, which emphasizes cost reduction.

While deviation remained high and above average within the context of this survey -- the two highest rated factors to this question were "New Markets/Revenue Growth" (7.19) and "Distribution Point" (6.08). This was far above "Reducing Costs" (5.49), "Manufacturing Platform" (5.36) and "Product Sourcing" (5.08), with "R&D/Monitoring" (4.47), "Engineering Talent" (4.46), "Hardware Design" (4.13), "Software Development" (4.09), and "Raising Capital" (3.4) rated lower still.

This shift in thinking was reflected in the comments of a West Coast Technology Sales Rep who stated, "With the weakened US dollar, it is a great way to create supplemental revenue streams. This was not, however, seen only as a matter of choice. As a Midwest-based Industrial Equipment Engineer described, "We have lost over 65% of our client base of manufacturing operations since the early '90's. International work is the only way to reclaim those opportunities."

A similar sentiment was expressed by a Sales Rep for a Major IT Component Manufacturer, who commented, "As a manufacturer, you have to go to where the customer is going to buy. Since China is becoming the 'factory of the world', manufacturers of components need to build and sell there. If you are a manufacturer and seller, you may might want to make things cheaper, but also to sell into this growing market. Japan is a good example. It used to be mainly an exporter but now is an end market. The same thing is happening in Korea and Taiwan and over time China and India. I was in Shanghai in January for the first time. You wouldn’t believe all the GM autos. It looks like the US in the 1960s. They are making big bucks and I am told this has become the most profitable division of the company. It is a fascinating story how they found a market while originally going there to reduce costs. On the other hand if I am a movie producer or game manufacturer, I have no interest as it will be pirated. You will only sell one copy. It depends on the industry. With hardware it is not as important."

Finally, while it was slightly surprising R&D, Design and Development rated lower than other options, this might be explained by the size distribution of respondent companies, in that these needs are usually more reflective of larger-sized firms.

Respondents' quotes

"With a weakened US dollar, foreign expansion is a great way to create supplemental revenue streams."

"It is unwise to transfer corporate technology to nations that are unprepared to acquire it and safeguard it."

"Outsourcing doesn't always work – there are too many problems with communication and quality. Also, there are many significant issues regarding the protection of intellectual property."

"I believe the talents of employees are not very important. The critical thing is how seriously the people think about their tasks by themselves."

"My company has lost over 65% of its client base (manufacturing operations) since the early '90's. International work is the only way to reclaim those opportunities."

"Some Pacific Rim countries offer good incentives to relocate manufacturing to their own country. However, comparable benefits are available in the US."

"As a manufacturer, you have to go to where the customer is going to buy. Since China is becoming the 'factory of the world', the manufacturers of components need to build and sell there."

"It is essential for our company to identify qualified overseas partners."