Question: An American company designed a new computer with the same capabilities as existing computers in the market; however, a new innovative process will cut the
An American company designed a new computer with the same capabilities as existing computers in the market; however, a new innovative process will cut the manufacturing cost in half. Numerous patents are pending for this new revolutionary design and manufacturing process. As the international manager of this company, you have been asked by the CEO to prepare a recommendation for potential expansion into a new market, country being Netherlands. You have three options for expansion into your target market: establish a wholly owned subsidiary, manufacture and market the product in the target market through a licensing agreement with a local firm, or export the products straight from the United States. Thoroughly assess the pros and cons of each option for your market before making a final recommendation to the CEO. Pros and Cons for all and recommendation which you prefer
Hint: You have already learned a great deal about your nation in previous assignments trade barriers, political climate, legal protections, etc. Utilize this information when you consider the various pros and cons in your nation's market when evaluating and selecting the FDI option. Note that what is a good option in one nation, may not be in another.
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