Saturday, November 14, 2015

Market Entry Strategy Assignment Help

In this assignment help post, you get the answer of the following question

Identify the three common entry strategies. Which one has the most appeal to you and why? Is there one entry strategy that you believe has more risk than another? Why?

Following are three common entry strategies:

Foreign Direct Investment: Foreign direct investment entry strategy is aimed to transfer entire firm to target market through which the firm can take advantage of that market. 

Market Entry Strategy Assignment Help
Franchising: In this form of entry strategy, a firm license business system and other rights to business entity or person. Under this, trade name and procedures of franchiser are followed by the franchise. In return of this, the franchisee provides fees, royalty and compensation to the franchiser. In this entry strategy, political risk is low and expansion into foreign market is rapid.

Licensing: It is a contractual agreement, in which the licenser provides patents, trademarks, company name, secrets etc to the licensee. In return of this, the licensee provides fees to the licenser. It is easy entry mode that needs little capital.

Out of these three entry strategies, foreign direct investment most appeal to me, as it has several advantages over exporting and licensing strategies. First, there is lower cost from local production in terms of transportation and custom duties. Second, marketing advantage in the form of easier adaptation to local preferences, low manufacturing costs due to inexpensive labor, raw material etc at local level.

Risk in Entry Strategy

 Out of all available entry strategies, licensing strategy of entry is more risky as compared to foreign direct investment and franchising strategies. It is so, as in licensing, there is lack of control of the licenser on marketing plan and processes operated by the licensee in the foreign market. In addition, the licensee may become the competitor of licenser in the foreign market in future. The licenser does not have choice to go for other entry modes, until the licensing agreement expires. Furthermore, as compared to foreign direct investment, the licensing income can be also small.

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