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Your assignment is to prepare and submit a paper on international business strategic plan memo.
Your assignment is to prepare and submit a paper on international business strategic plan memo. Several ways are available through which a company can enter a new market. Some of the most common ways are exporting, licensing, direct investment and joint ventures. Each of these ways is discussed here in the context of Gordon Composites and Egypt.
Exporting: It is one of the most widely used strategies in which companies only sell their products in the foreign markets. Products are produced only in the home country. It is a cost-effective strategy as no production facilities are required to be installed in the target country. All the costs are associated exclusively with marketing activities. The export mode is the only way of serving a market with minimum risk and high flexibility (Wagner, p. 3). There are two different types of exporting that we can adopt. These are direct and indirect exporting. In the case of direct exporting, products reach the end customers through independent distributors. On the other hand, indirect exporting involves a foreign purchaser and/or an export management organization (Hisrich, p. 198). Gordon Composites has the opportunity to export its products in Egypt. Two of its basic products i.e. bar stock and laminates can be exported through independent distributors.
Licensing: Licensing essentially authorizes an organization in the target nation (foreign market) by using the properties of a licensor. Usually, these properties are intangible in nature. Patents, trademarks, and production techniques are some of these properties. Such a strategy is likely to be an effective one in the context of maximizing revenue as the required investment amount is very low. Franchising, a special form of licensing, can also be adopted in the process of entering into a new foreign market. In this strategy “the franchise runs the business under the franchisor's trade name” (Klug, p. 39). Our company can enter the Egyptian market in franchise mode as well. .
