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Odysseus is a medium sized firm, relatively new to international business in terms of how to operate outside of its local market where it has been successful by being able to build a niche with its coupling and clutch products. Key Facts:

8 products with 600 sizes and types – small batches of orders (not mass production) •Patents across the globe
Odysseus Flexible coupling product - 33% of sales revenue, total from $64M to $169M in 2007 •Largest customer only 4% of revenue – sales is highly spread out •Export Sales @ $2.7M at a profit of 14.7%

International expansion
Siren in UK
o15 year license
o1.5% royalty
oBroad geographic coverage rights plus non-exclusive outside UK •Scylla, S.A. in France
o10 year license
o1.5% royalty
oExclusive in France and non-exclusive in Belgium
JV with Scylla, S.A
oName change to SOSA
o60/40 equity split with Odysseus funding the startup costs at $1.29M oMarket opportunity in France of $2.436M for L type coupling alone •German Acquisition
oHalted due to existing long-term license with Siren for the geography oMarket opportunity in Germany of $29M for L type coupling alone oAccess to largest marketing Europe
Local production challenge – competitiveness in local market and internationally oNeed to diversify into low cost centers
oUS production – avg cost of a manufacturing worker per hour = $23.82 was too high, need to review Mexico at only $2.75 per hour (almost 9x cheaper!) •Licensing
oSiren’s sales tripled in 5yrs to $131M – huge growth!
oPeriod of 15years is too long
o1.5% royalty is very low
oHigh tariffs 10% ++
oHard to compete in a JIT business model, where transportation is a challenge oOnly be able to supply to spare parts market (considerably smaller) •Pricing
oSame pricing model applied to all markets!
oChallenge of PPP whereby Odysseus should review different pricing by market, opportunity, competition,...
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