Question

If you were hired as a consultant, which international approach (i.e., export, licensing, etc) would you recommend the company adopt? Be sure to explain and justify your recommendation.

Answer 1

In the given scenario as mentioned, I would like to suggest for the joint venture approach the company should follow. It will help the company to share the burden of risk and return and it will help the company to get support of the local partner in the overseas market. So, my company will bring capital and technology and local partner of the overseas market, will provide local understanding of the market, local distribution network, market understanding and local legal and regulatory framework. So, both companies in the joint venture, will complement each other and venture will work successfully. So, the company can get a good return while sharing the risk and getting the local support. Over a period of time, the joint venture and my company develop competitive advantage in the marketplace. It prevents high level of risk, huge cost of transportation in exports, elimination of the scope of conflict of business with the partners and dilution of the brand that comes with the franchise model. It justifies my recommendation for the company.