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Eastman Kodak Company, popularly known as Kodak, was founded by George Eastman in 1889. Kodak
pioneered analogue photography and photographic films during most of the 20th century.
Kodak’s headquarter is in Rochester, New York and operates two segments in the areas of Graphics,
entertainment, and commercial films (GECF) and Digital printing and enterprise (DP & E).
Today Kodak is a global technology company, that provides products and services in the areas of
commercial printing, packaging, publishing, manufacturing, and entertainment to both the consumer
and commercial business segments whose operations involve Print Systems, Enterprise Inkjet Systems,
Micro-sized 3-Dimensional Printing and Packaging, Digital Solutions and Film (investor.kodak.com, n.d.).

Kodal has a global presence with manufacturing facilities and research and development groups in
various countries, primarily in the US, Japan, China, Canada, Israel, Germany, Japan, and China. In 2020
Kodak’s total recruitment count was 4,500 employees operating worldwide, where customers are
serviced through retail-based photo kiosks and digital dry lab systems in the host countries.
In 2020 Kodak declared gross revenue figures of 1.018 billion and a total asset base of 1.248 billion,
despite the declaration of bankruptcy in 2012. (Wikipedia Contributors, 2019).
Their primary competitors are Heidelberg, Agfa, and Fujifilm who collectively dominated the market
through industry experience, continuous improvement in business technology leadership and
continuous research and development for diversification.

(219 words)
OPEN BOOK EXAM QUESTIONS START ON THE NEXT PAGE
 Question 1 20 Marks

(700 words)

Kodak through Foreign Direct Investment (FDI) has cemented its footprints in Japan by investing
approximately US$75 million (approximately GYD 16.1 billion) to support it research & development and
manufacturing activities.

Kodak’s Positive Impact on Economies (Foreign Direct Investment)

One positive impact Kodak has on foreign economy is Foreign Direct Investment or Green Field Expansion.
Duce and Banco De España (2003) defines Foreign Direct Investment as the acquisition of a long-term
interest by a domestic entity of one country (direct investor) in an organisation that is housed in another
country (direct investment enterprise). When a multinational uses FDI as a market entry method, there is a
positive impact on the injection of capital in the direct investment enterprise, which ultimately increases
economic revenue and socio-economic boost.

Kodak’s choice of market entry into Japan is conditional that Japan ranks as the 3 rd largest country in the
world. Their GDP totals approximately $4.9 trillion and a population count of 126.2 million (Rahman, 2021.)

Kodak has worldwide operations with an average employee count of 4,500. Kodak’s presence in the
developing and underdeveloped economies, will support the decline of unemployment as there is job
creation in these countries. Ultimately, decrease in unemployment leads to increased spending and
stimulation of the economy, which ultimately leads to economic growth.

Another Positive Impact on the Economy (Knowledge Transfer and Increase in employment)

Japan’s main revenue stream are technology, the importation of auto parts and electronics and the
exportation of as a result the Guyanese workforce were equipped to operate in these traditional sectors.
With the advent and the increasing need for employment in the oil and gas sector, focus is now placed on
equipping Guyanese nationals with the requisite skill that they will be able to secure jobs in the new
market, in which US$2.4 million was invested to initiate an academy for Petroleum and Maritime
education. To date Schlumberger has trained and employed 12 Guyanese nationals from the Petroleum &
Maritime Academy to perform key roles in their operations (Guyana Chronicles, 2019). With a higher level
of education, Guyanese nationals will be academically equipped, which is an added value for both their
personal and professional development which coherently lends to a better quality of life for the individual
and their family members.

Schlumberger’s impact on the social benefit in Brazil was very marginal as there is a large disparity
between the impoverished and the affluential groups (World Bank, 2020).

Kodak’s Negative Impact on Economies (Repatriation of Profits)

Profit Repatriation is major disadvantage of an economy who has multinational companies’ offices and
production sites built in the host country. Siddiqui (2020) states that Repatriation of profits is achieved
when Multinational Enterprises (MNEs) sends profits or returns on investment earned in the country of
operation back to their home country.

Kodak’s Negative Impact on Economies (Competition)

The competitive pressures it faces could harm Kodak’s revenue, gross margins, cash flow and market share. The
markets in which Kodak does business are highly competitive with large, entrenched, and well financed industry
participants, many of which are larger than Kodak. In addition, it encounters aggressive price competition for many
of its products and services from numerous companies globally. Any of its competitors may: x foresee the course of
market developments more accurately than it does; x sell superior products and provide superior services or offer a
broader variety of products and services; x have the ability to produce or supply similar products and services at a
lower cost; x have better access to supplies and the ability to acquire supplies at a lower cost; x develop stronger
relationships with its suppliers or customers; x adapt more quickly to new technologies or evolving customer
requirements than it does; or x have access to capital markets or other financing sources on more favorable terms
than it can obtain. As a result, Kodak may not be able to compete successfully with its competitors. Finally, it may
not be able to maintain its operating costs or prices at levels which would allow it to compete effectively. Kodak’s
results of operations and financial condition may be adversely affected by these and other industry-wide pricing
pressures. If its products, services and pricing are not sufficiently competitive with current and future competitors, it
could also lose market share, adversely affecting its revenue, gross margins and cash flow. An inability to provide
competitive financing arrangements to Kodak’s customers or extension of credit to customers whose
creditworthiness deteriorates could adversely impact its revenue, profitability and financial position. The
competitive environment in which Kodak operates may require it to facilitate or provide financing to its customers.
Customer financing arrangements may cover all or a portion of the purchase price for its products and services. It
may also assist customers in obtaining financing from banks and other sources. Its success may be dependent, in
part, upon its ability to provide customer financing on competitive terms and on its

The Schlumberger Environmental Management Standard includes the following risk-based controls applicable to our
global operations: » Air emissions » Chemicals and materials management » Environmental competencies for key
personnel » Environmental communications » Contractual environmental risk management » Ecosystems and
biodiversity impacts and management » Environmental due diligence » Environmental impact assessment »
Environmental risk identification and risk management » Environmental nuisance management » Resource
management » Spill response and environmental emergency response » Waste management

Disadvantages

High capital expenditure and very risky as if the foreign country does not work out, retrenchment, sale of
assets.

Greatest risk. This method is only appropriate for mjulti national companies

In an invited comment to the Sunday Chronicle, the Managing Director revealed that the
overall construction of the company’s facility is expected to cost US$75 million. A major
component of the company’s new complex is a US$750,000 (approximately G$161 million)
nuclear calibration and storage facility, which is under construction at the Houston site.
 Question 2 30 Marks

(1050 words)

(a)

Adaptation versus Standardisation

Standardisation is the conversion or homogenization of products and services for the international
markets. This marketing mix approach is best suited for small and medium-sized enterprises (SMEs), who
has limited financial resources and lacks experience in market entry strategies. Standardisation can be
adopted for countries that share a common territory, socio-economic culture, language and where there is
the inclination of favourable legal and cultural factors. In contrast, adaptation is the process in which
elements of the marketing mix are modified or tailored to suit its marketing objective in its chosen market.
It is oftentimes feasible for Multinational Enterprises (MNEs) to engage in product adaptation once there is
efficiency of financial and material resources. Socio-economic and cultural differences are critical factors
governing the adaption of the marketing mix. The impact of the existing political landscape must be closely
analysed in this venture.

For Kodak, a blend of the adaption and standardisation marketing mix can be utilized in seeking out new
markets. When Kodak initiated entry into Russia in the early 1990s, the market for photography was
extensively underdeveloped and Kodak’s products were generally new to the socio-economic culture of
Russia. Steps were taken to promote Kodak’s homogenized products while some of the products were
tailored to suit the Russian market (Bartleby 2021). With franchising and foreign direct investment, Kodak
was able to pioneer the photography market in Russia.

(227 words)

(b)

Preferred Market Entry Method

Kodak is proposing entry into the Japanese market with the launch of the Kodak Sonora NX2 Process Free
Plate which has been adapted to suit the increased demand in the production/printing of the Japanese
daily newspapers. Joint Ventures and Strategic Alliances is Kodak’s preferred mode of market entry into
the Japanese economy. Strategic Alliances consists of multinational enterprise partnering with each other
to share resources (technology, production, marketing) while keeping their independent status,
conversely, Joint Ventures consists of an arrangement of two or more independent companies establishing
a subsidiary to achieve a common goal (Prange and Mayrhofer, 2015). With Joint Venture and Strategic
Alliance, Kodak will be able to capitalise on knowledge of the socio-economic cultures, laws and
legislations associated with business operations, this will come about from the recruitment of Japanese
personnel. Access to new opportunities in the foreign market is pivotal for the success of this product
which operates in conjunction with the high technological advancements being undertaken in Japan.

Kodak second quarter 2021 financial results reported consolidated income of 291 million dollars, a vast
increase in revenue of $78 million dollars from 2020, (Businesswire, 2021) with operations in over 150
countries. These two internal factors have rendered it very practicable for Kodak to undertake a market
venture of this magnitude. An analysis of Japan’s macro environment has solidified Kodak’s decision to
undertake Joint Venture and Strategic Alliance as its primary market entry strategy. Japan’s economy has
the 3rd highest ranking of Gross Domestic Product (GDP) in 2020 with US figures of 5,064,873 million (world
bank, 2020) with a corruption index score of 74/100 and ranking 19/180 countries (Transparency
international, n.d.). Another fundamental factor that supports the Joint Venture and Strategic Alliances is
the fact that Japan’s social culture predominantly supports local businesses, therefore, in an effort to
guarantee some semblance of success Kodak has considered this route. Irrespective of the high cost of this
market entry method, exodus from the joint alliances will not be tedious is business should fail.

Alternative Market Entry Method

Foreign Direct Investment can also be considered as a secondary market entry method. Foreign Direct
Investment (FDI) is a marketing mix objective where a resident entity of one economy obtains proprietary
interest in an enterprise in another economy (Duce and Banco De España, 2003), this is achieved by
investing in property, plant, and equipment in the host country. FDI is a very high-risk investment. This
type of market entry can only be undertaken by multi-national enterprises who has abundant resources
and significant international industry experience. Kodak offers a range of products and services globally.
Foreign Direct Investment in Japan would not only allow Kodak to promote the Kodak Sonora NX2 Process
Free Plate but engage in trade for its range of products and services. Additionally, Kodak can expand in the
area of electronics and high technology; an avenue in which Japan excels.

Arguments that favour investment in Japan are the fact that Japan ranked the third largest investor in the
world in 2020 notwithstanding investment by Japanese multinationals fell 49% to USD in 2019. This was
partly due to the economic crisis brought about by the Covid-19 pandemic. As a result, Japan is actively
opening its doors to foreign business. The country's key strengths are its position as a leader in advanced
technology and Research and Development and its strong purchasing power as a result of the density of
the population. However, demographic, linguistic, and cultural differences can be seen as potential barriers
to trade. Potential barriers to investment are essentially demographic, linguistic, and cultural. FDI is a
permanent market entry method which can result in major capital losses in the event of an economic crisis
that can adversely affect the future performance of the business (Santander, 2019).

Rejected Market Entry Methods

Direct Exporting will not be recommended as a market entry strategy for Kodak. Direct Export is the sale
of excess merchandise to a customer in an international market. Products are shipped directly to the
customer by containerizing (gacbec, n.d.). Direct exporting is a cost effective and low risk approach to
reaching external markets. Small and Medium Sized Enterprises (SMEs) usually engage in this type of
trade. Although Kodak has the financial capacity and skill set to conduct direct exporting, it is not the ideal
method as Kodak Sonora NX2 Process Free Plate has been specially adopted to meet the need of
specialized markets. The external economic factor that is inherent in this scenario is the need for a market
presence in the country of trade. Because of Japan’s high involvement in advance technology, and the
correlation of the nature of the commodity involved in the trade, direct exporting is not a viable avenue for
trading.

E-Commerce is the activity of buying or selling of products and accessing services through technology. An
analysis from Global Data shows an estimated 10.1 per cent increase in Japan’s e-commerce
market, in 2020 (Global Data, 2021) through transformational changes, as the economy responded
to the new norm of the novel corona virus. E-Commerce will add substantial advantage to Kodak’s
range of products that is used in the domestic market as brand visibility will be increased, resulting
in increased consumer buying. However, Kodak’s Sonora NX2 Process Free Plate has been specially
designed for the commercial consumer in a niche market. A major drawback in e-commerce is the
element of security and fraud, cyber hackers can use this medium as a means of tarnishing Kodak’s
brand as an industry leader. E-commerce is not a viable avenue of market entry for this product;
therefore, it is not recommended.

.
 Question 3 30 Marks

(1050 words)

Write your answer here

 Question 4 20 Marks

(700 words)

Write your answer here

Reference list

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[Accessed: 29 October 2021]

Businesswire (2021). Kodak Reports Second-Quarter 2021 Financial Results. [online]

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Quarter-2021-Financial-Results.
[Accessed: 24 October 2021]

Siddiqui, D. (2020). Google Scholar. [online] scholar.google.com.

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[Accessed: 29 October 2021]

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Appendix (optional)
Appendix 1