Entry Mode Options

Read the overview below and complete the activities that follow.

Businesses must make a number of decisions about entering foreign markets including which markets to enter, when to enter those markets, and on what scale. The firm may also choose from a number of entry modes. These choices are strategic decisions affecting both the short$-$ and long$-$term options for the firm.

When considering entry modes, both the advantages and disadvantages of each must be understood. The firm needs to consider such aspects as cost$,$ risk, and potential economies of scale, as well as the regulatory and political environments of the foreign market.

Which of the entry mode for low capital requirement is advantageous? $($Most of the capital to get operations going is not provided by the firm.$)$

Multiple Choice

Exporting

Turnkey Project

Licensing

Wholly$-$Owned Subsidiary

Joint Venture