WHAT IS INTERNATIONAL BUSINESS? – ENTERING OVERSEAS MARKETS

This continues the article on entering overseas markets

2. GREENFIELD INVESTMENT: a project that starts with bare ground and builds up from there. Coca Cola, McDonalds, and Starbucks are great examples of American companies that have invested in Greenfield projects around the world.

PROS:
1) Economies of scale and scope in production, marketing, finance, research and development, transportation, and purchasing.
2) Greater control in all aspects
3) Best long term strategy
4) commitment to market
5) Vendor financing often available
6) Work with authorities from the beginning
7) Control over your brand
8) Control over staff
9) Press opportunities

CONS:
1) Higher expense,
2) Competition in these markets can be difficult to overcome,
3) Entry into these markets can take years to happen.
4) Barriers to entry can be costly
5) Governmental regulations may put these multinational enterprises at a disadvantage in the short term.

Technorati Tags: Market Entry, , , , , , , , , , , , , , , , , , , ,

You can leave a response, or trackback from your own site.

Leave a Reply