Using a joint venture for a grocery store entering into a new foreign market (Mexico) make a entry strategy. Be as descriptive as possible.

Here is some information:

Mexican Grocery Shopping Experience

Mexico in comparison to other North American countries offers several different grocery shopping experiences at the many various stores and markets. There are plenty of locations that offer fresh produce, process foods, household goods and personal items. The shopping options are broadly diverse between traditional and contemporary. Grocery stores are usually within walking distance and centrally located. In contrast to North America, where traveling lengthy distances between selected stores is not unusual, in Mexico the grocery stores, local mega retailers and open markets are within blocks of each other. The proximity and many choices allow shoppers to choose merchants without having to spend much time or move distances, which makes for a very competitive market for the established businesses and particularly challenging for new entrants. Unlike the Walmart's in the US which offer a wide variety of items in every category, in Mexico, even at Walmart, selections are limited, and availability is not guaranteed [2]. Given the inherent loyal nature of Mexican a company looking to enter this mature market with an efficient and reliable supply of favorite products can be an opportunity to stand out. It is not uncommon that when a favorite item appears on the shelf, the shoppers need to capitalize on it by buying more than what is immediately needed. There is a chance you won't see these items for a while. Food prices are set so the locals can also afford to shop, in North America a typical grocery bill per visit is a hundred dollars, whereas in Mexico one can expect to pay 50 to 60 percent less hence local access to local supply chain and producers is key to keep prices low free from excessive transport and warehousing cost. METRO - A Canadian Grocery Chain

METRO INC. is a food and pharmacy leader in Qubec and Ontario. As a retailer, franchisor, distributor, and manufacturer, the company operates or services a network of 950 food stores under several banners including Metro, Metro Plus, Super C, Food Basics, Adonis and Premire Moisson, as well as 650 drugstores primarily under the Jean Coutu, Brunet, Metro Pharmacy and Food Basics Pharmacy banners, providing employment directly or indirectly to almost 90,000 people [3]. The leadership and tenacity of members and executives have allowed METRO over its over 70 years history to pursue its growth through mergers, acquisitions and innovations. The company is an acknowledged leader in food and pharmacy. In October 2011, Metro announced that it had entered into a partnership agreement with March Adonis, a well-established ethnic food retailer in the Montreal region specializing in fresh and Mediterranean products and prepared meals. Considering this successful merger which allowed the leadership to develop tailored to specific cultural needs product model positions the company very well in its first international expansion beyond Canadian boards.

Entrance strategy

Ideas to consider (organization design)

1. First time expansion outside of Canada (International orientation, not yet global)

2. Head Quarters to open a dedicated international division responsible for expansion in Mexico

3. Hire an experience management team at its home-based headquarters, preferably with members fluent in Mexican culture, context and language to run the international division (Mexican Division). Foster a climate of International Entrepreneurship among this group.

4. Task the Mexican division to find local partners to form an equity type joint venture while METRO having controlling stake and top down, centralized decision management and source of finance.

5. Joint venture set up will help METRO in the following areas:

a. Improvement in efficient operations: achieve economies of scale that would not be possible without a local partner while spreading the risks.

b. Access to knowledge: each of the partners will have access to the knowledge and skills of the other, especially in technology, logistics and sourcing.

c. Mitigation of political factors: Mexican partner will be very helpful in dealing with political risks, helping to understand local regulations and consult on government relations and restrictive laws.

d. Overcoming collusion or restrictions in competitions: a Mexican partner will help METRO overcome the effects of local collusion and limits put on foreign competition. METRO will become an "insider" to the local well establish group of players.

Organizational Characteristics

1. High formalization - Mexicans prefer to organizations with well-defined structures and systems of decision making, top down communication and controlling.

2. Horizontal Specialization - implication of Mexican work culture, employees will be given a particular function to perform and stay within the confines of the responsibility area, allows the company to develop superb functional expertise.

3. High centralization of decision making headquartered in Canada.