Domestic. Most organizations begin by operating within a domestic market- place. For example, a business that starts in the U.S. marketplace must recruit, hire, train, and compensate their employees who are usually drawn from the local labor market. The focus of the selection and training programs is often on the employees’ technical competence to perform job-related duties and to some ex- tent on interpersonal skills. In addition, because the company is usually involved in only one labor market, determining the market rate of pay for various jobs is relatively easy.

As the company grows it might choose to build additional facilities in different parts of the country to reduce the costs of transporting the products over large distances. In deciding where to locate these facilities, the company must consider the attractiveness of the local labor markets. Various parts of the country may have different cultures that make those areas more or less attractive according to the work ethics of the potential employees. Similarly, the potential employees in the different areas may vary greatly because of differences in educational systems.

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