Chapter 7 Global market entry stratagies.pptVIP

Learning Objectives Key Points 1) Understand the concepts of global market entry strategies 2) Understand the importance of investment 2. Difficulties 1) Learn to apply the global market entry strategies in global marketing activies 2. Investment FDI( Foreign Direct Investment) 1.Definition Classic definition,? is defined as a company from one country making a physical investment into building a factory in another country.? But, with the advent of the Internet, the increasing role of technology, loosening of? direct investment restrictions in many markets and decreasing communication costs means that newer, non-traditional forms of investment will play an important role in the future. 2.Function of FDI FDI figures reflect investment flows out of the home country as companies invest in or acquire plants, equipment, or other assets. FDI provide a firm with new markets and marketing channels, cheaper production facilities, access to new technology, products, skills and financing. 3.FDI in developed countries developing countries 4.Forms of FDI Joint Ventures Ownership Equity Stake Joint Ventures 1.Definition A joint venture (often abbreviated JV) is an entity formed between two or more parties to undertake economic activity together. The parties agree to create a new entity by both contributing equity, and they then share in the revenues, expenses, and control of the enterprise. 2.Attractions of JVs Sharing of risk (financial risk political uncertainty) Help to learn about a new market environment To achieve synergy A way to enter a country or region Synergy Synergy, according to Webster‘s Dictionary is the “cooperative action of discrete agencies such that the total effect is greater than the sum of the effects taken independently.” (协同效率，商业中两个单独的单位联合在一起时比独立时更能有效的发挥潜力） Value Chain The value chain, also known as value chain analysis, is a concept from business management A value chain is a chain of activities. Products pass through all activities