Advantages of Dumping
1. Market Expansion: Dumping can help companies expand their market share in foreign countries. This expansion can provide opportunities for economic growth, job creation, and increased revenue for the exporting company.
2. Economies of Scale: Large-scale production allows for cost efficiencies that enable lower prices. Lower production costs facilitate competitive pricing, making products more affordable for consumers in the target market.
3. Strategic Positioning: Dumping can strategically position a company as a price leader, gaining a competitive advantage over local rivals. This strategic positioning may contribute to brand recognition and loyalty, enhancing the company’s long-term market position.
4. Market Share Dominance: Dumping aims to capture a significant share of the foreign market by offering products at more attractive prices. Achieving dominance can create barriers for new competitors and solidify the exporting company’s market influence.
5. Global Presence: Dumping facilitates the establishment of a global presence, allowing companies to diversify their operations and reduce dependence on a single market. A global footprint can provide resilience against economic downturns in specific regions, ensuring a more stable revenue stream.