A further segregation of operating activities is almost always useful in an analysis of diversification. In addition to diversifying their products, companies can also diversify geographically, maintaining operations in many countries or region.
Product Segmentation
Product may be segregated in many ways. To be effective, the segregation should reduce a company's exposure to economic fluctuations. These are, however, no two companies that provide precisely the same product.
Geographic Segmentation
The diversification of sales and/or production facilities in different countries does help some companies overcome regional or national economic fluctuations. Geographic diversification is classified by two different criteria : the destination of sales and the origin of production.
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