Global Management
Today, if companies really want to be successful in the business world not only are they limited to conduct private and government operations locally,but also in other countries. Our book defines global business as the buying and selling of food and services from different countries. This activity involves foreign trade, which includes transactions (exports, imports,investments, and financing) that are performed worldwide. Corporations go international to locate resources that are hard to obtain in their country, or that can be found at a better price internationally. Globalization and the expansion of world trade have had a tremendous impact in the last decades bringing substantial benefits to countries around the world. As globalization increases everyday, many countries have created agreements to reduce barriers such as tariffs, export fees, and the reduction of restrictions on the movement of capital and investment. In 1994, the North American Free Trade agreement was created to remove most barriers to trade and invest between the United states, Mexico and Canada. Mexico has become the United States’ second-largest export market and third-largest trading partner due to demographic and geographic factors.
Monterrey, the third largest city in Mexico and base of many multinational corporations, has taken advantage of this agreement to expand its businesses. This is the case of Grupo ALFA, leader in the production of processed meats and cheese and one of the most important telecommunications service companies in Mexico. This company acquired Bar-S Foods Co. leader in the U.S. packaged meat business to expand their market and generate additional profits. According to Armando Garza Sada, ALFA’s Chairman of the Board: “This is an important milestone in Sigma´s growth strategy. With this acquisition, Sigma will become a meaningful player in the U.S. refrigerated processed meats market with an important presence in the U.S. Hispanic market.” (ALFA, 2012)
Another example of a multinational corporation expanding thanks to this agreement is GRUMA, leader in corn flour and tortilla production in Mexico. GRUMA operates in more than 100 countries and recently acquired a local flour company in new Mexico to expand their market in the United States.“More than two-thirds of GRUMA’s revenues come from sales outside Mexico. In a major 2010 report on Mexican corn policy since the North American Free Trade Agreement” (Salem-news, 2011) NAFTA opened the doors to this company that is taking advantage of the opportunities offered in the United States.
Due to its closeness to the United States, the government of Monterrey has decided to build an “Interpuerto”, to facilitate exports and imports with the United States. “At the moment it is just a thousand hectares of mud on the outskirts of Monterrey, a bustling industrial city in northern Mexico. Soon it should be the “Interpuerto”, a customs-clearing zone to speed goods on their way to the United States via two rail lines and the motorways to which it will be connected” (Economist, 2010)This project will certainly help to increase business between Monterrey and the United States. The interpuerto will help companies to work and grow faster because many of the raw materials used in Mexican manufacturing facilities are sourced from the United States.
One of the main reasons companies go global is to increase profits. Selling products and services in other country may increase sales and profits . This is the case of IDZ, an industry leader in automatic tool and asset management solutions. Developers of technologies such as RFID (radio frequency identification) and other proprietary, patented technologies. This company with base in Monterrey have chosen San Antonio, Texas to manufacture its tools management systems and expand their business in the United States. Thanks to this move the company has earned ten times more than usual. “Because of San Antonio's help, the company has raised its annual U.S. sales projections to $4 million from $400,000, Lizarraga Henderson said” (Hendricks, 2009) Although violence has increased dramatically in the last years due to the drug war. Monterrey still is a great place for foreign companies to locate significant manufacturing operations in Mexico. Because of the low cost labor market in Mexico and the close proximity to the U.S. Monterrey have become the perfect place for these companies. Recently Sanyo built a manufacturing plant in Monterrey.“The Monterrey plant is an important and vital production location in North America for the assembly of our world’s highest efficiency HIT modules, and feel that the work done here has largely contributed to the growth in sales in North America, and will remain a factor as this region continues to grow.”(Sanyo)
Companies that go global will not just increase sales and profits but it will also reduce the company's exposure to possible economic problems in a single country. Monterrey plays an important role in today's business world. The city is not just base of several multinational corporations but also is an extraordinary place to invest and open manufacturing plants due to its fast development. Bibliography

2010 Bringing NAFTA back home http://www.economist.com/node/17361528

2009 Commerce News: Tortilla Kings Claim New Mexico Conquest http://www.salem-news.com/articles/april262011/tortilla-commerce.php
Alfa.com(2012) http://www.alfa.com.mx/SP/press.htm?md=agosto09&y=2010

Hendricks, David. 2009 Mexico firm selects San Antonio for manufacturing http://www.mysanantonio.com/business/local/article/Mexico-firm-selects-San-Antonio-for-manufacturing-848593.php#ixzz1qOQRSvBo

Sanyo.com (2009) http://us.sanyo.com/News/SANYO-CELEBRATES-GRAND-OPENING-OF-NEW-MONTERREY-SOLAR-MODULE-ASSEMBLY-MANUFACTURING-PLANT-WITH-CEREMONY