Description
strategies for international expansion like alliances, acquisitions, taking subsidiaries route. It also lists the risk associated with international expansion.
International Strategies
Do regions matter ?
?
Labour pooling
?
Specialized local supplies Technology spillovers
?
……….. Identifying opportunities
?
Increased market size
Economies of scale & learning Return on investment Locational advantage
?
?
?
Competitive advantage of nations
Factors of Production
Firm Strategy, Structure & Rivalry
Demand Conditions
Related & Supporting Industries
………Types of Corporate Strategies
?
Multi-domestic
?
Global Transnational
?
Choice of Entry Mode
?
Exporting
Licensing Strategic Alliance Acquisition Wholly owned subsidiary
?
?
?
?
Exporting
?
Often used mode of entering international markets, especially by small firms High cost of transportation + possible taxes + distributor’s margin
Technology / internet as a facilitators
?
?
Licensing
?
Licensee
? ? ?
takes the risk, makes the investment manufacturing, marketing & distribution
?
Licenser
?
Paid a royalty
Alliances
?
Allows alliance partners to share risks and resources May lead to development of new core competencies
High failure rate as difficult to manage
?
?
Acquisitions
?
Quick excess to new markets
Difficulty in integration Require debt financing, which may be a burden Necessitates complicated legal structures
?
?
?
Subsidiaries
?
Potentially expensive
Affords maximum control Likely to give above average returns
?
?
Transferring competencies abroad
?
Though difficult to implement
Contributes to development of broader and /or competencies Dominating depth, difficult to create by purely domestic companies
?
?
Cross market subsidization
?
Profit sanctuaries in home countries
Valuable financial strength to launch global strategic offensives “Dumping” – Is it a bad word ?
?
?
Risks
?
Political
?
?
? ?
War Potential threat of a war Integration Change of government
Risks
?
Economic
? ? ? ? ?
Failure of domestic demand Devaluation Privatization Nationalization Regional trading blocks
doc_354837118.ppt
strategies for international expansion like alliances, acquisitions, taking subsidiaries route. It also lists the risk associated with international expansion.
International Strategies
Do regions matter ?
?
Labour pooling
?
Specialized local supplies Technology spillovers
?
……….. Identifying opportunities
?
Increased market size
Economies of scale & learning Return on investment Locational advantage
?
?
?
Competitive advantage of nations
Factors of Production
Firm Strategy, Structure & Rivalry
Demand Conditions
Related & Supporting Industries
………Types of Corporate Strategies
?
Multi-domestic
?
Global Transnational
?
Choice of Entry Mode
?
Exporting
Licensing Strategic Alliance Acquisition Wholly owned subsidiary
?
?
?
?
Exporting
?
Often used mode of entering international markets, especially by small firms High cost of transportation + possible taxes + distributor’s margin
Technology / internet as a facilitators
?
?
Licensing
?
Licensee
? ? ?
takes the risk, makes the investment manufacturing, marketing & distribution
?
Licenser
?
Paid a royalty
Alliances
?
Allows alliance partners to share risks and resources May lead to development of new core competencies
High failure rate as difficult to manage
?
?
Acquisitions
?
Quick excess to new markets
Difficulty in integration Require debt financing, which may be a burden Necessitates complicated legal structures
?
?
?
Subsidiaries
?
Potentially expensive
Affords maximum control Likely to give above average returns
?
?
Transferring competencies abroad
?
Though difficult to implement
Contributes to development of broader and /or competencies Dominating depth, difficult to create by purely domestic companies
?
?
Cross market subsidization
?
Profit sanctuaries in home countries
Valuable financial strength to launch global strategic offensives “Dumping” – Is it a bad word ?
?
?
Risks
?
Political
?
?
? ?
War Potential threat of a war Integration Change of government
Risks
?
Economic
? ? ? ? ?
Failure of domestic demand Devaluation Privatization Nationalization Regional trading blocks
doc_354837118.ppt