Overseas Market Entry Methods
The theme of my presentation is “Overseas Market Entry Methods”
In this case I would like to tell you about :
1) Scheme of the Methods;
2) Exporting;
3) Joint Venture;
4) Direct Investment;
5) Advantages and Disadvantages
First method includes:
1)Direct Export - the organization produces their product in their home market and then sells them to customers overseas
2)Indirect Export - the organizations sells their product to a third party who then sells it on within the foreign market
Another less risky market entry method is licensing. Here the Licensor will grant an organization in the foreign market a license to produce the product, use the brand name etc in return that they will receive a royalty payment. ( ex. Coca-Cola)
Franchising
Franchising is another form of licensing. Here the organisation puts together a package of the ‘successful’ ingredients that made them a success in their home market and then franchise this package to oversea investors. The Franchise holder may help out by providing training and marketing the services or product. McDonalds is a popular example of a Franchising option for expanding in international markets.
Manufacturing Abroad The ultimate decision to sell abroad is the decision to establish a manufacturing plant in the host country. The government of the host country may give the organization some form of tax advantage because they wish to attract inward investment to help create employment for their economy.
Joint Venture is a cooperation of foreign and local investors of the capital in order to create a local business that they own and manage jointly.
Subsidiary is a company that is completely or partly owned and partly or wholly controlled by another company that owns more than half of the subsidiary's stock. The subsidiary can be a company, corporation, or limited liability company. In some cases it is a government or state-owned enterprise. The controlling entity is called its parent company, parent, or
In this case I would like to tell you about :
1) Scheme of the Methods;
2) Exporting;
3) Joint Venture;
4) Direct Investment;
5) Advantages and Disadvantages
First method includes:
1)Direct Export - the organization produces their product in their home market and then sells them to customers overseas
2)Indirect Export - the organizations sells their product to a third party who then sells it on within the foreign market
Another less risky market entry method is licensing. Here the Licensor will grant an organization in the foreign market a license to produce the product, use the brand name etc in return that they will receive a royalty payment. ( ex. Coca-Cola)
Franchising
Franchising is another form of licensing. Here the organisation puts together a package of the ‘successful’ ingredients that made them a success in their home market and then franchise this package to oversea investors. The Franchise holder may help out by providing training and marketing the services or product. McDonalds is a popular example of a Franchising option for expanding in international markets.
Manufacturing Abroad The ultimate decision to sell abroad is the decision to establish a manufacturing plant in the host country. The government of the host country may give the organization some form of tax advantage because they wish to attract inward investment to help create employment for their economy.
Joint Venture is a cooperation of foreign and local investors of the capital in order to create a local business that they own and manage jointly.
Subsidiary is a company that is completely or partly owned and partly or wholly controlled by another company that owns more than half of the subsidiary's stock. The subsidiary can be a company, corporation, or limited liability company. In some cases it is a government or state-owned enterprise. The controlling entity is called its parent company, parent, or