Term
| reasons for expanding a manufactuering company's operations into some form of overseas production |
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Definition
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Term
| type of expansion: defensive |
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Definition
| response to pressure from some outside source, as a foreign government, competition, or nationalistic-oriented buyers |
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Term
| type of expansion: offensive |
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Definition
| difference in attitude; done by choice and according to the plan |
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Term
| alternative modes of entry |
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Definition
| manufacturing, assembly, strategic alliance |
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Term
| disadvantages of manufacturing facilities |
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Definition
| large investment in capital, personnel problems, relations with government |
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Term
| advantages of manufacturing facilities |
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Definition
| control and flexibility, easier protection of trademarks, integration of worldwide production program |
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Term
| advantages of assembling in foreign country using imported parts |
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Definition
| cost saving in manufacturing at the home plant, value added and technology to remain at home |
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Term
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Definition
| companies from two or more countries forming long term collaborative arrangements. licensing, contracting, and joint venture are activities between companies known as strategic alliances. to enhance the long-run competitiveness of strategic partners. both parties have something to offer |
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Term
| strategic alliances: licensing |
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Definition
may involve technology, trademark, designs, knowledge, various payments and fees
advantages: ease and low cost
disadvantages: create porential competitor, loss of control, lack of flexibility |
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Term
| strategic alliances: contracting manufacturing |
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Definition
contract to have a company's product manufactured by local manufacturer.
advantages: minimum investment; control over marketing
disadvantages: loss of manufacturing profit; create potential competitor; difficult to find good manufacturer |
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Term
| strategic alliances: management contracting |
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Definition
local investors provides the capital for the enterprise, while the international marketer provides the know-how to manage the company
advantages: low risk way into foreign market; quick return
disadvantages: complex agreements with potential for conflict |
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Term
| how to succeed in joint venture/strategic alliance |
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Definition
- top management must be continually involved
- meet frequently, and often informally
- use a matchmaker
- maintain independence
- allow no "sacrifice" deals
- have a monitor
- anticipate cultural differences
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