Wholly owned manufacturing facility - Entry Strategies

Corporate Management

Prepared By

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Manu Melwin JoyAssistant Professor

Ilahia School of Management Studies

Kerala, India.Phone – 9744551114

Mail – manu_melwinjoy@yahoo.com

Entry Strategies

• Market entry strategy is influenced by the firm and product characteristics and the domestic and international market characteristics.

Foreign Market Entry and Operations Strategies

Exporting

• Direct Exporting.

• Indirect Exporting.

Contractual Agreement

• Licensing & Franchising.

• Strategic Alliance.

• Contract Manufacturing.

Production facility in foreign

market.• Assembly Operations.• Wholly owned

manufacturing facility.• Joint Ventures.

Mergers and Acquisitions

Wholly owned manufacturing facility.Companies with long term and substantial interest in the foreign market normally establish wholly owned manufacturing facilities there. A number of factors like trade barriers, difference in the production and other costs encourage the establishment of production facilities in the foreign markets.

Joint VenturesForeign joint ventures have much in common with licensing. The major difference is that in joint ventures, the international firm has an equity position and a management voice in the foreign firm. A partnership between host- and home-country firms is formed, usually resulting in the creation of a third firm.

Mergers and AcquisitionsFrom a legal point of view, a merger is a legal consolidation of two companies into one entity, whereas an acquisition occurs when one company takes over another and completely establishes itself as the new owner