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International Market

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1. If you were to run a company that made a realy cool gadget (e.g. MP3 player, all-in-one phone, pen-sized camera, etc.) and you decided it was time to enter the international market, which strategy would you utilize? (Export/import, Management Contracts, Licensing, Franchising, Joint Venture/Strategi Alliance, Wholly Owned Subsidiary)? Why?

2. If you ran a compay that provided a service rather than a physical product, would your answer to the same question above be the same or different? Why?

3. If your company made the same product in the U and another country of your choosing, would you expect the same productivity? Better? Worse? Why? My country would be Africa.

Please explain each in detailed format.

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Solution Preview

1) If I made a really cool gadget that I was afraid others would copy, I would set up a wholly-owned subsidiary in the target market. With simple export, you lose all control once it leaves your dock. Licensing and Franchising does not allow you to earn high profits for such a product as you have. These would be better for services or for a mature product that you happen to have a patent on. With a joint venture or other type of alliance, you open yourself to a host of problems, including setting up a potential compatitor who could turn around and export to your US market. There are also a host of management headaches with sealing with foreign partners. The only advantage to such a partnership would be speed to market. With the right partner who has excellent distribution ...

Solution Summary

International market is debated.