foreign entry + entry modes

Question 1

motives

Answer 1

• market seeking
• efficiency seeking
• resource seeking
• strategic assest seeking

Question 2

proactive motive reasons

Answer 2

• Profit and growth goals
• managerial urge
• foreign market opportunities
• economies of scale
• tax benefits.

Question 3

reactive notice reasons

Answer 3

• competitive pressures
• domestic market saturated
• foreign orders
• extend sale of seasonal products.

Question 4

Barriers to internationalisation initiation

Answer 4

• Insufficient finances
• insufficient finances
• cost escalation
• lack of export commitment
• lack of connections

Question 5

barriers hindering the process

Answer 5

• general market risks ie competition from other firms
• commercial risks such as exchange rate fluctuations and delays
• political risks such as gov restrictions and lack of tax incentives.

Question 6

Entry modes

Answer 6

• Export modes- low control, low risk and flexible, 100% externalising
• intermediate modes - shared control, risk and ownership.
• hierarchical modes - high control, risk and low flexibility, 100% internalising

Question 7

Uppsala model basic assumptions

Answer 7

1) firm first develops in domestic market
2) internationalisation is a consequence of a series of incremental decisions
3) main obstacles to internationalisation are of knowledge and resources
4) psychic distance influences the internationalisation process.

Question 8

Market commitment with Uppsala model

Answer 8

1) no regular export activity
2) export via independent representatives.
3) establishment of a foreign sales subsidiary
4) foreign production/manufacturing units

Question 9

critical views of Uppsala model

Answer 9

• too deterministic
• does not take interdependencies into account between different market countries
• firms can leapfrog stages
• not called in situations of highly internationalised firms and industries.

Question 10

TCA on entry modes

Answer 10

risk- resource commitments
uncertainty- control

Question 11

Dunnings eclectic approach

Answer 11

• ownership advantages
• locational advantages
• internationalisation advantages.

Question 12

factors supporting Born globals

Answer 12

• role of niche markets
• financial markets becoming International
• flexibility
• advances in tech
• advances of speed in information .