Sample Thesis Paper
Below is a list of international market entry strategies that can be employed by textile firms from Belgium, these are:
- Joint venture
- Direct investment
- Licensing and
Exporting is a traditional method that involves selling products that are produced domestically into a foreign market. There is no investment in the country of import since the production is carried out in the country of export. In the export strategy, there players involved are the exporter, importer, government and transport provider. This strategy is favorable when there is a high degree of political risk, high production costs in the importing country, available distribution channels and liberalized import policies. The main advantage of this strategy is that there is minimum risk in the investment, fast speed of entry in the market and minimum expenditure since the exporting firm uses the already existing production facilities.
Licensing allows a firm to use properties of licensor and pays the licensor some fee. Among the properties that can be lent out include patents and production techniques. This strategy is characterized by high returns on investment, evasion of trade barriers and limited investment risk. Among the conditions favoring this strategy is cultural distance, import barriers and legal limits. Among the disadvantages associated with this strategy includes limited control over the property, licensee may turn to be a competitor, the licensee may have limited period to operate the business and knowledge spillovers.