Strategic management

Assignment no: 02
Topic: Give three Examples of each International Entry mode

Submitted to:
Sir Shahyar
Submitted by:
Eisha maham
Roll no:
18Arid-832
BBA 5th

Gujarat Institute of Management Sciences PMAS-

Arid agriculture University Rawalpindi

Question: Give three Examples of each International Entry mode given beow:
Exporting
Example no: 01
 Company A is a U.S. car manufacturer, and it exports auto parts to Mexico.
Example explain
If the dollar is strong against the Mexican peso, it takes fewer dollars to export the auto
parts to Mexico. Conversely, if the dollar is weak against the Mexican pesos, it
strengthens the power of the Mexican exporter. To deal with currency risk, the U.S. car
manufacturer should insist that all deals with Mexican partners are made in US dollars.
On the downside, this may deter Mexican exporters of partnering with the US exporter,
preferring to do business in their.

Example no: 02
 The Mumbai based American dry food (ADF) Which began selling a range of packaged
food liked chutney, spices, canned vegetable ready to eat etc. under different brand name
names later moved to other countries with large Indian population.

Example no: 03
 An example of this would be directly selling computer parts to a computer
manufacturing plant. Direct exporting requires market research to locate markets for
the product, international distribution of the product, creating a link to the consumers,
and collections.

Licensing
Examples no: 01
 Suppose Company A, a manufacturer and seller of Baubles, was based in the US and
wanted to expand to the Chinese market with an international business license. They can
enter the agreement with a Chinese firm, allowing them to use their product patent and
giving other resources, in return for a payment. The Chinese firm can then manufacture
and sell Baubles in China.

Example no: 02
 For example, Merck and Upjohn have licensed organizations in other parts of the world
to manufacture and sell their pharmaceutical products. Other firms using licensing
agreements in this way include McDonald's, Nestlé, Anheuser-Busch, and KFC.

Example no: 03
 Under licensing system, Coca-Cola and Pepsi are globally produced and sold, by local
bottlers in different countries.

Joint Venture
Example no: 01
 Another famous example of joint venture formation is the agreement between Kellogg
and Wilmar International Limited. Kellogg International entered the market in order to
expand its presence in the Chinese market to sell cereals and other snack foods to
consumers in China. Joining hands together with Wilmar resulted in a profitable synergic
relationship for both the companies as Wilmar International provided extensive
distribution and supply chain network to Kellogg International and also Kellogg managed
to enter into a new geography with this agreement and relationship.

Example no: 02
 Sony and Ericson’s example is also a good example of Joint Venture as they joined hands
to manufacture smartphones and gadgets. After several operating years, Sony eventually
acquired Ericson mobile manufacturing division.

Example no: 03
 Google parent company and the pharma company Glaxo and Smith decided to enter into
a joint venture agreement to produce bioelectric medicines the ratio of the ownership was
45%-55%. The joint venture lasted and was committed for 7 years with a capital of Euro
540 million.

Franchising
Example no: 01
 For example, soft drink bottlers often obtain franchise rights from soft drink companies to
produce, bottle, and distribute soft drinks. The major soft drink companies also sell the
supplies to the regional manufacturing franchises.
o In the case of Coca Cola, for example, Coca Cola sells the syrup concentrate to a
bottling company, who mixes these ingredients with water and bottles the
product, and sells it on.

Example no: 02
 Fast food restaurants are good examples of this type of franchise. Prominent examples
include McDonalds, Burger King, and Pizza Hut.

Example no: 03
H&R Block Tax Preparation
 This tax preparation company began offering franchise opportunities in 1955. The
company helps franchise owners keep up with the changing economy and increased tax
regulations. Some of the support offered to franchisees includes tax software, the ability
to prepare taxes online and a tax preparer training program for employees.
 o Company also offers on-the-ground training and support, as well as a dedicated
management support team to help franchisees grow their businesses. The
company does have financing options for business owners who wish to purchase
an existing franchise.

Production share
Example no; 01
 Example of production-sharing is the hand- held electronic calculator. It many carry the
nameplate of a Japanese company -but this the only thing on it that is "Made in Japan."
The electronic chips came from the United States.

Example no: 02
  For example, a Detroit auto parts manufacturer may team up with a Mexican company to
produce high quality and competitively priced products.

Example no: 03
  For example, companies in Japan, Korea and Taiwan primarily co-produce in China,
Indonesia, Malaysia, Thailand, and the Philippines with a focus on computer hardware,
telecommunications equipment, electronic components and appliances.