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Multinational Corporations Expanding into Japan

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Read the following article and write an analysis focusing on the question below:
•Czinkota, M.R., & Kotabe, M. (1999). Bypassing barriers to marketing in Japan. Marketing Management, 8(4). (AN 2795277).

How might MNCs structure their market entry strategies to penetrate and expand in the Japanese market?

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Here you go- sorry about the confusion

Japan: A Unique Opportunity for Multinational Corporations
A multinational is defined as a "business concern with operations in more than one country outside the company's home country" ((Reference for Business, 2013). These corporations may be viewed in a positive light, in terms of bringing money and goods into a country, or they may be viewed as exploitive, an attempt to change local cultural, or a way for already large organizations to become even bigger. As a result, there are instances in which it is more difficult for multinational corporations to expand, depending upon the country, the product, or the circumstances. Typically multinational corporations seek access to new markets by acquiring an existing operator (as Walmart frequently does), partnering with a local operation (as Honda did with Hero in India) or through sequential market entry (as Sony did in the United States, starting with manufacturing televisions, and then expanding to magnetic tapes and audio equipment. The Japanese market is unique and creates a need for a thoughtful strategy. In order to maximize their success, multinational corporations should structure their market entry strategies in a similar fashion as other multinational corporations who have previously entered the Japanese market successfully.
Japan represents a unique situation in that there are informal business groups called keiretsu or "grouping enterprises" (Czinkota, 1999), which were able to establish dominance in the Japanese economy in the last several decades. A keiretsu is formed by member companies buying small portions of each other's organizations, centered on a financial institution. The financial institution (bank) was able to help the group from stock market fluctuations and make the member organizations stronger. This format also made it more difficult for outside companies to do business in Japan, since they lacked the same strength and protection as members of the keiretsu. There were all types of industries involved in keiretsus, each benefiting from ...

Solution Summary

This detailed solution discusses how MNCs structure their market entry strategies to penetrate and expand in the Japanese market based on the case study by Czinkota and Kotabe (1999).

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Analysis for the annual report - a multinational corporation

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Obtain the annual report of a multinational corporation (MNC) that interests you. Use the annual report and other information you may gather to report on the following

Summarize any comments made in the annual report about

- the MNC's level of international operations (sales, production, purchases, etc.)
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- the impact of the MNC's foreign business on its recent performance.

Summarize how the MNC was affected by recent changes in the U.S. dollar's value. Explain why the MNC was favorably or unfavorably affected by the dollar's recent movement. Look for any comments in the report that describe the MNC's transaction exposure or economic exposure. Summarize the MNC's translation exposure and the effect of the dollar's recent movements on consolidated earnings. In what ways does the MNC hedge its foreign exchange risk exposure?

Summarize why the MNC has increased its international operations over time. Determine which factors were most influential in motivating the MNC's expansion into other countries. Has the MNC engaged in strategic alliances to accomplish this growth? If so, what forms has it used and what motivations are apparent?

Where does the MNC obtain the financing (both long-term and short-term) it needs to fund its operations? Has it issued any bonds denominated in foreign currencies? Does the MNC generate cash flows in that currency that could be used to cover the annual payments? (Give your opinion if this is not clear from the annual report.) Summarize any statements made regarding the MNC's decision to finance with U.S. dollars versus foreign currencies.

Summarize the forms of political risk that the MNC is exposed to according to the annual report.

Does it appear that the MNC has benefited from its international operations? Explain.

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