06 Fragen

Pull:

attractive foreign markets (for company)

ZB China - labour

high potential

less bureaucrazy

Push

unattractive home markets

unused capacity

bureaucracy

overcapacity

sometimes not posible to produce in just 1 country

• aircrafts

penetrate markets step by step

lower risk -> less immediate reward

focus on single (groups) of country

—

other hand:

sprinkler strategy

all markets at a time

not all resources at one market —> spread them

global introduction

something starts -> gets copied -> hype -> hype even bigger than reality -> correction

just going international because other companies are doing it

automotive: going to Asia

all going together: all win / loose together

DISTANCE

CORE: Distance between two countries:

C cultural

A administrative

G geographic

E economic

Pankaj Ghemawat

evaluate risks and opportunities

• the more two coutries differ in CAGE the riskier

• Country level analysis

• Industry Level

Near culture: GER- NL

Political near: NL-Sweden

Geo near: France-GER

econocmic total difference: Nigeria in raw materials and GER

cultural difference: Iranian and US CEO

Culture sensitivity differences a high role: food, relating into everyday life

political and administrative pharma, TV and co

economic sensitivity: high connection with economy steps like japan and GER : Strong in machinery and cars

Culture: close to customer

modify product to individual needs

media firms

overview

1 slide: 2 dimensions:

• amount of resources you have to invest

• level of control

• what type of partnership do you want?

• joint venture, merger,…

Direct vs Indirect

• deliver chemicals: need of a distributor (environment etc)

• Franchise

• Joint Ventures : partners

• Greenfield: build new company in other country

either sell direct to company or customer in target company, or use intermediate

pro:

• direct customer contact (or trader)

• direct access to contact

• full control

• different pricing —> new customers

• knowing customers

• higher profit margin

• independence

con:

• high investment

• a lot of work

• greater financial risk

• investment of time and staff

• limited market coverage

• insufficient market knowledge

Pro:

• no or few extra staff needed

• agent knows market and channels

• more complete market coverage possible

• smaller financial risk

Con:

• lower profit margins

• dependence on commitment of partner

• n direct customer contact

expansion of own foreign company

aquisition of a foreign company as wholly owned subsidiary

Greenfield

• do it from scratch

-establish own company

M&A

Strategic Alliance

Joint Ventures (still direct)

2 companies/ partnersJoint venture

• two (or more) companies build partnership

• international trade without full responsibility

• gain comp. strenght

• knowledge transfer, technology transfer

keep resource commitment very low

SEIBERT MEDIA

BioNTech —> too small on global market —> too poor —> Pfizer received control and gave money + knowledge

value added

• pharmaceuticals

• media

  • Dan Brown books

McDonald´s

KFC

Pizza Hut

Burger King

includes licencing; more like renting (time scheduled)

own P&L (profit n loss)

Joint Ventures DIRECT INVESTMENT

legal entities

2 companies/ partnersJoint venture

• benefit: less resources + more Knowledge

• two (or more) companies build partnership

• international trade without full responsibility

• gain comp. strenght

• knowledge transfer, technology transfer

• Ford wants to modify for malaysian company: work with malaysian company

• in China often needed (by law)

• often not 50:50 —> 51:49

  • block decisions, keep control