ntry who would market the product in host country or can be done directly by using an intermediary in target country. Boeing is one of the largest direct exporters, manufactures most of its aircraft in USA but sells most of them in other countries. However, there can be problems related to tariffs, government intervention and costs. A Pharmaceutical firm wanted to export its drugs to China; however, China wanted it to produce the drugs in China in collaboration with a local Chinese firm. Thus technology transfer was needed by the country to enter it. So, the firm decided to go with Joint venture.
According to FIDIC (1991), in Turnkey contracts, a developer (contractor) is hired for execution and completion of project without owner's input. Final price and date completion of project is decided in advance and there is fair amount of risk sharing between contractor and employer. This contract is generally used in Building or
construction business. Where FDI'S were restricted, Turnkey contracts were used to enter the market.
According to Needle (2004), Licensing allows a firm in overseas market to enter a contractual mode with one or more local partners which allow the foreign firm to use its technology, patents, company name and methods of running the business for a fee paid to the local firm. Licensing also gives some part of profit to other parties. Example: iphone.
According to Madura (2008), Franchising makes a firm to provide specified sales,
strategy and may be initial investment as well for periodic fees. It allows a foreign firm to market its product through a contract. Examples, service industries like McD and KFC. The initial costs are low and setting up subsidiary is cheaper than buying land, training etc. Like Licensing, it gives some share of profit to other parties. However, the company is not in full control of the technology. For example, in China, protecting copyrights is an issue. As explained in lecture (Artisien, P Lecture, 22nd February 2011), in Strategic Alliance, two companies agree to share some facilities, they enter strategic alliance. Examples: Nokia, Boeing (777) alliance with Japanese consortium.
According to Osland (2001) et al, Joint venture basically means setting up a firm in target country, sharing management and risks by two or more firms. Competitors work jointly with their competitors to deal with completion, technology transfer and enter new market. However, there can be problems related to ownership control, commitment and government policies. Matsushita is in a joint venture with Philips in Belgium to manufacture batteries.
Wholly- owned subsidiary are subsidiaries operated in another country and is completely owned by parent company. Japanese automobile companies used to enter US market through this mode of entry in 1980s. Toyota has established a (Greenfield) site in Indiana to manufacture four -wheel vehicles. (Osland et al.2001)
According to Foster and Foster (2006), Offshore outsourcing means that an organization hires another firm in another country to perform an activity or part of process for easy access to resources, to gain competitive advantage, developing countries are attracting companies from developed nations as they provide quality and cheap services and manpower, infrastructure facilities and round the clock operations due to time zone difference. Citibank, Lehman Brothers, JP Morgan have outsourced overseas th
本论文由英语论文网提供整理,提供论文代写,英语论文代写,代写论文,代写英语论文,代写留学生论文,代写英文论文,留学生论文代写相关核心关键词搜索。