Week 7 - Summary

Question 1

Three checks before internationalization:

Answer 1

1. Motivation Check analyzes 1) Drivers, 2) Expected benefits, and 3) possible synergies
2. Readiness Check analyzes 1) Company preparedness, 2) Product suitability, and 3) Target market suitability
3. Decide on which market to enter, (market selection) when, (first mover / late mover) how, and on what scale
   (import/export, intermediate, hierarchal

Question 2

Consider advantages and risks of entry modes

Answer 2

(i.e. cost, implementation time, control, flexibility, etc.)

Question 3

Risks associated with common entry modes include, from low to, …

Answer 3

include, from low to high, export , licensing, franchising, joint ventures, mergers and acquisitions, and wholly owned subsidiaries

Question 4

Risk in entry methods is negatively correlated with …

Answer 4

… control, expenditures, and commitment

Question 5

Other considerations include…

Answer 5

the firm’s internationalization strategy, competencies, product characteristics, target country, availability of partners, etc.

Question 6

A Global Standardization strategy provides …

Answer 6

better control (i.e. FDI/Wholly owned Subsidiary); a Localization strategy fits with low( er ) control entry modes (i.e. contractual cooperation ) a Home Replication / International strategy favors export to opportunistically explore new markets