Every company in the International Business will pass through the 5 different stages of Internationalization. They are:

  • Domestic Company
  • International Company
  • Multi-National Company
  • Global Company
  • Transnational Company

Stage – 1: Domestic Company

Domestic Company limits its operations, mission and vision to the national boundaries. This company focus its view on the domestic market opportunities, supplies and customers. These companies analyze the national environment of the country, formulate the strategies to exploit the opportunities offered by environment. They never think of growing globally. They believe in saying, “ if it is not happening in home country, it is not happening”.

Stage – 2: International Company

Domestic companies which grows beyond their production capacities, think of internationalizing their operation. Those companies which decide to exploit the opportunities outside the domestic country are stage – 2 companies.

These companies believe that the practices the people and products of domestic business are superior to those of other countries. The focus of these companies is domestic but extends the wings to the foreign countries. These companies select the strategy of locating a branch in foreign markets and extend same domestic operations into foreign markets.

Stage – 3: Multi-National Company

International companies turn into the Multi-National companies when they start responding to the specific needs of different country market regarding product, price and promotion. This stage is also referred as Multi-Domestic companies. These companies formulate different strategies for different markets. They operate like a domestic market of country concerned in each of their market.

Stage  4: Global Company

A global company is the one, which has either global strategy. Global Company either produces in home country or in a single country and focuses on marketing these products globally or produces globally and focuses on marketing these products domestically.

Stage – 5: Transnational Company

It produces, markets, invests and operates across the world. It is an integrated global enterprise that links global resources with global markets at profits. There is no pure Transnational.