multinational companies operating in the global marketplace. Include one U.S. and one foreign company

Using the Internet and the Argosy University online library resources, conduct research and answer the following questions.

1. For the international company operating in the U.S. you selected, answer the following:What entry strategy was used to expand into the U.S. market?What are some of the risks and issues associated with this entry strategy?What are some alternative entry strategies this international company could consider?How has the chosen entry strategy fared?
2. For the U.S. company operating in an international country you selected, answer the following:What expansion strategy did the company use? Why do you think it chose this strategy over others?What type of regulations do you think your selected company will need to comply with prior to expanding into new markets?How was the investment in foreign operations funded by the U.S. parent company?

Write a 3- to 5-page report in Microsoft Word format. Apply current APA standards for writing to your work. Use the following file naming convention: LastnameFirstInitial_M1_A2 . For example, if your name is John Smith, your document will be named SmithJ_M1_A2 .

Assignment 2: Individual Research—International Market Entry Strategies

Companies typically select an entry strategy that would best meet their needs. For instance, a typical strategy for Toyota is licensing, where Toyota manufactures the cars and fills the orders for it while another organization is responsible for the distribution and marketing.

In 2007, Wal-Mart announced their intention to expand into China by agreeing to purchase an established discount chain. Read the following for more information:

· Wal-Mart expands Chinese business. (2007, February 27). BBC News. Retrieved February 2

4

, 2009, from

http://news.bbc.co.uk/2/hi/business/6399531.stm

In this assignment, you will investigate and review two large multinational companies operating in the global marketplace. Include one U.S. and one foreign company.

You may select one of the MNCs from the list given for the course project. Ensure that the MNC you select for this assignment is not repeated in the course project. Here is the list: CEMEX, Fiat, Nestle, Grupo Gigante, Komatsu, Shell, IKEA, Toyota, Wal-Mart, Coca-Cola, McDonald’s, Honda, and Philips Electronics.

Using the Internet and the Argosy University online library resources, conduct research and answer the following questions.

A. For the international company operating in the U.S. you selected, answer the following:

1. What entry strategy was used to expand into the U.S. market?

2. What are some of the risks and issues associated with this entry strategy?

3. What are some alternative entry strategies this international company could consider?

4. How has the chosen entry strategy fared?

B. For the U.S. company operating in an international country you selected, answer the following:

1. What expansion strategy did the company use? Why do you think it chose this strategy over others?

2. What type of regulations do you think your selected company will need to comply with prior to expanding into new markets?

3. How was the investment in foreign operations funded by the U.S. parent company?

Write a 3- to 5-page report in Microsoft Word format. Apply current APA standards for writing to your work.
Use the following file naming convention: LastnameFirstInitial_M1_A2 . For example, if your name is John Smith, your document will be named SmithJ_M1_A2 .

By Friday, May 10, 2013, submit your assignment to the M1: Assignment 2 Dropbox.

12

Assignment 2 Grading Criteria	Maximum Points
Presented conclusions that demonstrated adequate analysis and synthesis of research information.		12
Supported assertions with reasons, examples, and references to reliable sources.
Written paper shows application of current APA standards for editorial style, expression of ideas, citations, and references.	4
Total:	28

Wal-Mart expands Chinese business

Wal-Mart, the world’s largest retailer, is expanding its presence in China after agreeing to buy a 35% stake in discount store chain Trust-Mart.

The terms of the deal, giving Wal-Mart an interest in 100 stores in 34 Chinese cities, were not revealed but analysts have said the business is worth $1bn.

Should Wal-Mart ultimately buy out the group, it would make it China’s largest foreign retailer in terms of stores.

Foreign sales currently account for about 20% of the firm’s turnover.

Based in Taiwan, Trust-Mart was set up in the mid-1990s and has more than 30,000 staff.

‘Important step’

“ We have the opportunity to expand our presence in China, one of the world’s fastest growing markets ”
Michael Duke, Wal-Mart

Along with other leading global retailers like Carrefour and Tesco, Wal-Mart is looking to build its interests in China’s fast-growing retail sector.

The firm already operates 68 stores there and said last year that it was prepared to hire an extra 150,000 staff in the next five years.

Wal-Mart said the latest deal was an “important step” for the business.

“Through this investment in Trust-Mart we have the opportunity to expand our presence in China, one of the world’s fastest growing markets,” said Michael Duke, Wal-Mart’s vice-chairman.

Wal-Mart said the two companies would, for the time being, operate independently but that if “certain conditions” were met, it could buy out the remainder of the business by 2010.

Mixed record

Wal-Mart’s efforts to expand outside the US have not proved an unqualified success, raising questions about whether its retail formula can be replicated elsewhere.

The firm pulled out of Germany and South Korea after struggling in those markets, while its Japanese subsidiary Seiyu has made heavy losses.

The US firm is currently looking to develop a joint venture business in India, a plan which has sparked protests by small shopkeepers.

Carrefour is currently the leading foreign retailer in China, with 90 hypermarkets.

Tesco opened its first own-brand store in China last month, and has interests in another 45 outlets through a joint venture with a domestic retailer.

China’s retail sector was worth nearly $850bn in 2005 and is forecast to grow to more than $2 trillion by 2020.

Story from BBC NEWS:
http://news.bbc.co.uk/go/pr/fr/-/2/hi/business/6399531.stm
Published: 2007/02/27 07:51:58 GMT
© BBC 2013