1. Mode of Entry
Firms planning to market their products or services have several means of entering foreign markets. Generally, the upfront costs, opportunity for greater profits and risk vary with the chosen entry mode. Actually, there is a correlation of increased costs, profit opportunities and risk, by entry mode, that can be interestingly illustrated. This correlation can be seen as a 45-degree angle from the intersection of the “X” and “Y” lines when constructed in quadrant I. The entry modes, wholly owned subsidiary, franchising, exporting and joint ventures need to be properly sequenced from the X/Y intersection on the positive X line. Create this illustration in quadrant I. Show the X and Y intersection and the proper placement/sequence of these entry modes on the X axis. NOTE: The Y-axis is understood to be increasing upfront costs, greater profits and higher risk. PROVIDE A CITATION TO SUPPORT YOUR ILLUSTRATION.
1. Go to globaledge.msu.edu. Go to Global Insights. Choose Business Service industry .
A. Comment on the degree of “fragmentation” in this industry?
B. What are the primary demand drivers in your industry?
C. What are the primary profitability drivers in your industry?
D. Comment on the industry labor versus capital intensity?