Assignment #2 - Case Study Background You have just begun a new job as President of Unlimited Combines (UC), a Canadian farm equipment manufacturer whose flagship product utilizes new technology to increase the productivity of grain harvesting UC's equipment allows farmers and commercial grain-growing operations to harvest wheat, barley and similar cereal crops faster and with less waste than any other equipment manufacturer You are surprised to find that while UC's products sell very well in the domestic market, they appear to be a well-kept secret around the world. Recognizing that the world market offers an excellent growth opportunity, you hire Patricia Paget, a new business school graduate, as your export manager, and assign her the responsibility to create and implement an international business plan and begin developing new global business opportunities for Unlimited Combines The International Business Plan Patricia's first task is to generate an international business plan. She develops a table of contents making sure to mention issues of the new era in global business, the global supply chain, technology, culture and ethics. Also addressed are interational market research, entry and maintenance, trade finance, global logistics and distribution, and legal issues and compliance. When her plan is complete, Patricia emails a form letter to more than 130 Canadian trade offices around the world in order to confirm which markets are the most suitable Within two weeks, she receives responses from more than sixty of the offices, with contact information for a total of more than four hundred potential business partners. However, she is puzzled as to why some of the companies appear to have no relationship with farm equipment She receives no reply from the other seventy or so offices. In order to qualify the potential distribution channels, she sends an English form letter out to the four hundred potential business partners, with a questionnaire for them to fill out. After three weeks, she had received replies from only 12 of them. Patricia is becoming frustrated that she lus now spent over a month on trying to find potential distributors for the products, with few results. International Market Entry Strategies Module-Planning for International Market Entry FITT 2 One of the positive results Patricia has received is from a Japanese manufacturer of farm equipment. She arranges for a business trip to Japan to meet with them. Upon arrival, she encounters several problems. The company is located several hundred kilometers from the nearest large city, and by sheer luck she finds an English-speaking person to help her with a train connection. When she arrives, she is given several attractive gifts, but has brought none with her just brochures. She quickly finds that nobody at the company speaks English, although the written communications had been in English, and she only brought English language brochures The company eventually brings someone in to help with translations. However, this only highlights a major problem: the company thought the UC combine would work on rice, which was incorrect. Ricetums out to be the main crop grown in Japan, but few cereal crops are grown because they are casily imported at low cost. Only a small percentage of Japan's land is suitable for farming, so farmers focus on higher value produce. Because Patricia has arranged for se other meetings during her trip to Japan, she is determined to make this one a success. They discuss many topics as she tries to forge a relationship with the company, and it turns out that the Japanese company exports its equipment around the world and might consider a strategic alliance with UC, whereby it would leverage its distribution network to sell UC's products IKT 2350 - Assignment The company eventually brings someone in to help with translations. However, this only Highlights a major problem the company thought the UC combine would work on tice, which was incorrect. Rice turns out to be the man crop grown in Japan, but few cereal crops are grown because they are easily imported at low cost. Only a small percentage of Japan's land is suitable for farming, former focus on higher-value produce. Because Patricia has arranged for no other meetings during her trip to Japan, she is determined to make this one a success. They discuss many topics as she tries to forge a relationship with the company, and a fure out that the Japanese company exports its equipment around the world and might consider a strategic alliance with UC, whereby it would leverage its distribution network to sell UC's products, One troublesome issue is financing. She is surprised to find the Japanese company prefers to image for long-term payment terms through trade financing, but she insists that they work on a cash in advance basis. She knows from what she has heard that international trade is risky, and that payment in advance would eliminate the risk of non-payment. Another issue is technical opport. The Japanese sugest that they would like to have technical training as part of a legal contract they would sign, if they decide to work together. Patricia knows that they might reverse engineer UC's product, and does not want to be constrained by a contractelor legal obligation, so is not enthusiastic about this Marketing support also presents a problem. The Japanese want to translate her brochure into other languages of their own expense and ask if she would email the document to them so they could do the translation. However, she says she canne, for copyright reasons, but that they can use the brochure she is going to leave them if they don't tell anyone. Another feature of "marketing support, it turns out, is that it is occasionally necessary for them to pay tribes to movement officials in some of their non-Japanese market. They matter-of-factly say this is just a cost of doing business in some countries and ask if UC will be able to contribute to paying these commissions". Finally, the Japanese want Cost, Insurance and Freight (CIF) pricing, but Patricia insists on Ex Works EXW) terms. This will also help her to minimise risk and keep cost down, and let the Japanese pay the cost of freight. She has enough to do, after all, and does not want to get involved with the complexities of global logistics. As l'atricia leaves the meeting pleasantries are exchanged. When she asks if they think there is a chance to do business together she receives a smile from the general manager, who says, "We will try International Market Entry Strategies Module-Planning for International Market Entry FITT 3 When Patricia returns, you ask ber how the trip went. She provides the details outlined above and replies that although it went reasonably well, the Japanese were demanding and difficult to do business with During the next month, after repeated and increasingly demanding attempts to extract an agreement to purchase from the Japanese company, she finally receives a simple reply saying. We are sorry, but we prefer to do business with Unlimited Combines at some time in the future Explain the types of market entry strategies and considerations for both products and services in terms of their application, advantages and disadvantages Select the most advantageous market entry strategy for an international venture hused on the results of feasibility research, risk malysis, and competitive analysis