Provide a scenario where a company would enter a foreign market using the following modes of entry. Be sure to provide one scenario for each mode:
- Exporting
- Licensing
- Franchising
- Creating a turnkey project
- Establishing joint ventures
- Setting up a wholly-owned subsidiary
Give justification for your choices using the advantages or disadvantages for each mode discussed in course readings.
Read the closing case from the text at the end of Chapter 13. Prepare a response to the following questions:
a) GM entered the Chinese market at a time when demand was very limited. Why? What was the strategic rational?
b) Why did GM enter through a joint venture with SAIC? What are the benefits of this approach? What are the potential risks here?
c) Why did GM not simply license its technology to SAIC? Why did it not export cars from the United States?
d) Why has the joint venture been successful to date?