Purchase Solution

Advantages and Disadvantages of Business Operations in Foreign Countries

Not what you're looking for?

Ask Custom Question

As part of its international expansion program, Acme, a U.S. multinational enterprise (MNE), is currently in the planning stages of establishing a Greenfield (see text glossary for definition) production facility overseas. You have been asked to present a proposal to the steering committee comparing the advantages and disadvantages of starting operations in one of two selected foreign countries.

The steering committee has determined that one alternative must be a member of the European Union (EU) while the other cannot be a member of the EU. Subject to these conditions, you may choose any two foreign countries, except China, India, Czech Republic, and Romania for comparison.

There are many factors to consider in your comparative analysis. Please be sure to include, among other topics, a discussion of the different countries' currencies, trade policies and cultural variables that may affect operations and profitability in each country. Your report should conclude with a recommendation and supporting rationale as to which country should be selected for the new facility.

Purchase this Solution
Solution Summary

The advantages and disadvantages of business operations in foreign countries are determined. The factors to consider comparative analysis are given.

Solution Preview

Introduction
In this competitive business environment, organizations are tended to determine proper expansion planning as it helps them to determine potential risk and Return on Investment (ROI) of their project (Wang, 2009). In this guideline the planning process to establish a production facility in foreign countries through Greenfield strategy will be discussed. This establishment will be determined in concern of two foreign countries namely UK and Japan. In this guideline, advantage and disadvantage in concern of both countries will be discussed for providing a base to the steering committee for its international expansion decision. Countries will be compared in this guideline on the basis of such factors that may influence its expansion success namely trade policies, cultural factor and currency (Paul, 2011).In addition, logical recommendation will be also included to provide the basis for country selection decision.
Greenfield Strategy
Greenfield strategy can be defined as a way in which organizations seeks entry in foreign market without the help of any other existing organization. This strategy is quite opposite to other entry strategies namely joint venture, partnership and acquisition as they include existing organization in different forms. This strategy has been selected by ACME for making entry in international market (Paul, 2011). Risks and opportunities with this strategy are quite high as in this; company does not have any local help, which is essential to understand the operational environment. Company will face unfamiliar business environment that may create several issues for this new venture. In order to make this entry ...

Purchase this Solution
Free BrainMass Quizzes
Understanding the Accounting Equation

These 10 questions help a new student of accounting to understand the basic premise of accounting and how it is applied to the business world.

Income Streams

In our ever changing world, developing secondary income streams is becoming more important. This quiz provides a brief overview of income sources.

Academic Reading and Writing: Critical Thinking

Importance of Critical Thinking

Marketing Research and Forecasting

The following quiz will assess your ability to identify steps in the marketing research process. Understanding this information will provide fundamental knowledge related to marketing research.

Lean your Process

This quiz will help you understand the basic concepts of Lean.

View More Free Quizzes
Related BrainMass Solutions

  • Ethics

    Examine the requirements for successful management of a Global Business. In your opinion what are the advantages and disadvantages of a company going global.

  • Strategic Management: Business Policy and Strategy

    //After going through a brief description of international operations, we will now, discuss the 'Advantages and Disadvantages' of international operations in business.// Advantages International operations help an organization to have an easy

  • Political and Economics Risks of Multinational Corporations (MNCs)

    Access to labor - a firm that has operations in many countries can set up its production operations in China or India to take advantage of cheap labor and then sell products in more affluent countries in North America and Europe.

  • Describe and discuss examples of MNC structure types

    Functional Structure: An organization is working in several countries and each function is in a separate foreign entity.

  • two types of foreign exchange rate targeting

    This post articulates the advantages and disadvantages of foreign exchange rate targeting.

  • Main Entry Modes in Foreign Countries

    290308 Main Entry Modes in Foreign Countries What are the main entry modes in foreign countries? What are their advantages and disadvantages? How would you enter a high-risk country? How would you enter a small foreign market?

  • Effectiveness of offshoring;

    The cost of operations is lower in the country to which the services have been moved. The countries to which business processes are off shored are also concerned that their operations do not become expensive compared to those of other countries.

  • Companies conducting business in foreign countries

    What do you think are the advantages and disadvantages of using agents to enter to foreign markets?

  • Establishing A Greenfield Production Facility

    You have been asked to present a proposal to the steering committee comparing the advantages and disadvantages of starting operations in one of two selected foreign countries.

View More Related Solutions