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Define the following modes of entry into foreign markets:

Define the following modes of entry into foreign markets:

Exporting
Countertrade
Switch trading
Counter purchase
Licensing, franchising
Collaboration
Strategic alliances
Equity joint ventures

Additionally, discuss the following:

Motives, advantages, and disadvantages of each term above
Overall control issues and risks
If you were an international clothing manufacturer who was looking to reduce costs and improve efficiencies, which do you think is the entry mode that promises the best success?

Solution Preview

When a company adopts an exporting mode of entry strategy, they begin directly selling their products into the foreign market without the aid of any other company or organization. This is generally the most unsuccessful entry mode and meets the highest rate of failure in the global market. When a company engages in a countertrade, they exchange goods or services with a company in a foreign country where the company wishes to establish entry. No money is exchanged, and is useful for companies that want to expand but do not have an excess of capital to work with. Switch trading is one form of countertrading where the buyer in one country pays ...

Solution Summary

Define the following modes of entry into foreign markets:

Exporting
Countertrade
Switch trading
Counter purchase
Licensing, franchising
Collaboration
Strategic alliances
Equity joint ventures

Additionally, discuss the following:

Motives, advantages, and disadvantages of each term above
Overall control issues and risks
If you were an international clothing manufacturer who was looking to reduce costs and improve efficiencies, which do you think is the entry mode that promises the best success?

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