to international trade fell and a wave of firms began pursuing global strategies to gain a competitive advantage. However, some industries benefit more from globalization than do others, and some nations have a comparative advantage over other nations in certain industries. To create a successful global strategy, companies first must understand the nature of global industries and the dynamics of global competition.The furniture industry is an example of an industry that did not lend itself to globalization before the 1960's. Because furniture has a high bulk compared to its value and because furniture is easily damaged in shipping, transport costs traditionally were high. Government trade barriers also were unfavorable. The Swedish furniture company IKEA pioneered a move towards globalization in the furniture industry. IKEA's furniture was unassembled and therefore could be shipped more economically. The company also lowered costs by involving the customer; the customer carried the furniture home and assembled it himself (Babyak, 1995). The differences between regional and global market concept in the appliance industry certainly play a big part. In the regional market, products are customized for each market, and local-decision-making puts enormous impact on companies. Product differentiation, local responsiveness, minimized political risk, and minimized exchange rate risk are just few advantages of the regional market concept. On the other hand, the global market favors centralized control, which little decision making authority on the local level. Reduced costs, coordinated activities, faster product development are the advantages over regional market.I strongly believe that the appliance industry is regional than global in terms of product customization and competitions. For example, in Europe refrigerators tend to be smaller than in the U.S., have only one outside door, and have standard sizes so they can be built into...
