b) The Use of Entry Mode- Joint Venture
Joint venture is two or more firms join together to create a new business entity that combine their technology, experience, resources, financial, skills and others.
Create a statement and proposal to form a joint venture
A foreign company should know the reasons to form a joint venture into India. The foreign company should set up a clearly vision, mission and goals for enter another country market. You will know the particular of finding a partner that fulfill your qualifications.
Research and choosing the right partner
The foreign firm should reseach all the information to find strategic partners that fulfill your needs. You need to compare the companies that can help you penetrate into the market. The foreign firm should consider at least four factors in selecting partner: Compatibility
The firm must choose a compatible and reliable partner. Without any trust, the business is unlikely to succeed. A firm must know the management of the style and team in the organization.
Nature of a potential partner`s products or services
Each company have their own expertise. The firm should form an alliance with a partner whose services or products are complementary and do not compete each other’s in the market.
The relative safeness of the alliance
The manager must assess the success or failure of previous strategic alliance formed by the potential partner and analyze the potential partner`s strength and weaknesses.
The learning potential of the alliance
A firm learning the potential from each other’s. It can understanding the different of the corporate culture, management of the inventory and the training for the employees.
Create a joint venture agreement
A joint venture agreement is the legal document that sets out between two or more business partners to the joint venture is responsible for and how the partners will work together on a common business strategy. This aim is to clarify the relationship...
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