A) Evaluate various exit strategies (e.g., divestiture of assets, handing over to joint venture partner, diversification, or shutting down operation), and contingencies for your global venture (Costco Wholesale Warehouse in South Africa) and
b) Why I would choose these exit strategies.
c) Make final recommendations about the feasibility of this global venture which is opening a Costco Wholesale Warehouse in South Africa.
d) Examine how contemporary trends in the global environment might impact your final recommendations.
I have included an attachment of my prior assessment Global Business Considerations.
a) Evaluate various exit strategies (e.g., divestiture of assets, handing over to joint venture partner, diversification, or shutting down operation), and contingencies for your global venture
( Costo Wholesale Warehouse in South Africa) and
The factors that should be considered for exit strategy are:
A) Industry/Market growth rate
If the industry growth rate is declining then the market becomes unattractive
B) Company growth rate
If the company growth is declining then also the market becomes unattractive
C) Unfavorable government regulations
D) Decline in profits due to competition, change in demand besides other factors. Suitable exit strategy
Divestiture of the assets
It can be a trade sale to another outside party. It can fetch a good price but it should be attractive to the buyer. If your business is not already limited, it may be difficult to achieve a trade sale as the value of the business it is worth considering incorporation to give the business its own legal identity. Selling on the business' trade, assets or customer list should then be easier. This may also make a merger possible - although this would probably mean remaining with the business for longer than if you make a straightforward trade sale.
The chances of a successful trade sale can be improved by drawing up and following a clear exit strategy and minimizing the potential hurdles to a successful exit.
Handling over to Joint venture partner
This is also a popular route to exit where by the JV partner purchase the stake of the organization to have full control over the venture.
Under this the organization expands to the unrelated industry for further growth and profitability.
It is exiting the business and liquidating the assets. This may not fetch the good price.
The implementation of exit strategy will depend on the future potential of the business growth. IF there is lack of FIT between strategy AND
The solution evaluates a global business plans exit strategies and contingencies of the global venture for Costco Wholesale Warehouse in South Africa.