1. Gross fixed capital formation is the total amount of capital invested in factories, offices, and other investments for the business. When these investments are increasing, the country is more likely to grow. This difference between Japan and Ireland would indicate that Ireland is growing much faster than Japan. Companies are more likely to realize that Ireland is much more appealing destination because of the growth and the lack of regulation. Japan may be perceived as a hassle and full of regulation. 2. The internationalization theory states, licensing has three major negatives as a strategy for to adapting to the foreign market opportunities. They include licensing may result in a firm giving away valuable technology to foreign …show more content…
Cemex has many qualities that are difficult to duplicate into other companies. Yet, these qualities could be hard to channel into other companies. The company should therefore invest directly into the foreign market. This way they can operate at the same success as they had in their domestic country. They would be able to control the customer service and quality that made the company so great initially. b. This brings a lot of growth to the host country and into the construction field, which will improve wealth and the standard of living. No I do not see any drawback for Cemex. They would do well investing inwardly, yet there is more room for growth in other markets and into other nations and businesses. c. Acquisitions make sense because there is a track record behind the business. They would not have to necessarily have to start form scratch in a foreign nation. Cemex can make this business prosper into something new. They have the experience and the knowledge in the industry to apply. A green field venture would hold more risk and would not be quite as cost effective. …show more content…
The FDI level has been so low in previous years because of the regulation they have had to shy away foreign investments. In the retail sector for example, they established the Large Scale Retail Store Law, making large volume stores unable to do business in the country. They even resisted acquisition from foreign investors because of the fear is that new workers would restructure too harshly, cutting jobs and breaking long-standing commitment with suppliers. 2. A benefit of Japanese having a grantor FDI includes bring competition to Japan were local ones may not already be experiencing it. This could source new management ideas, business policies, and technology; all of which could boost productivity. It was the opportunity to help restructure Japan’s retail sector that would boost productivity, gaining market share, and profiting from the process. This attracted the worlds largest retailer to
“By 1870, 90% of Japan’s international trade was controlled by Westerners living in Japan.” (Woods, SW. (2004). Japan an Illustrated History (1st Edition). Hippocrene books pg. 111).
Breaking into new markets helps the company grow and brings in new customers, which leads to higher profit margins.
Today, Johnson & Johnson is a pharmaceutical giant worth $71 billion. The company is listed on NYSE as JNJ with 2.83 billion shares outstanding with the value of $92.7 per share.
Background: Merck & Co. is an American pharmaceutical company and one of the largest pharmaceutical companies in the world. In 1971 the United States approved the use of an MMR vaccine made by Merck, containing the Jeryl Lynn strain of mumps vaccine. In 1978 Merck introduced the MMR II, using a different strain of the rubella vaccine. In 1997 the FDA required Merck to conduct effectiveness testing of MMRII. Initially it was over 95%; to continue the license; Merck had to convince the FDA that the effectiveness stayed at a similar rate over the years.
...choices for executives, and gaining rapport with local suppliers, the corporation stands a good chance of achieving success in their foreign expansion.
The first alternative of keeping the plants in the US would mean that Eletrocorp obeys the strict environmental and safety regulations, pays its workers $15/ hour, but avoids the loss of jobs in the US. The company would incur high production costs. The second alternative of relocating plants to South Africa would create a job loss in the US. The company would save costs by hiring workers for $10/ day and obeying less strict safety and environmental standards. The strong labor union could cause problems in the future. The third alternative of relocating to Mexico would have the same effects as relocating to South Africa, except that the wages for workers are $3/ day. A larger amount of costs could be saved, although Electrocorp would have to pay attention to citizen health groups which could cause bad publicity. The last alternative of relocating to the Philippines offers the highest cost savings due to the least strict safety and environmental regulations, no activist groups and the market pay rate of $1/ day.
... be set at fair prices and therefore successful trading. Also, through commercialization, the Japanese were able to expand on their own lives and embellish their lives more.
Q3: What have been the “keys to success” for Invacare in the past? Are these likely to change in the future?
.... It has used this strategy to overcome various challenges (such as avoiding hostile takeover by foreign companies) while at the same time developing competitive advantages. Examples of the competitive advantages CEMEX has enjoyed over the years include ability to operate in volatile markets, integrate successfully with its acquired firms, and easy acquisition of funds. However with its level of debt increasing increasing, CEMEX should know consider expanding through an organic growth strategy.
Merck & Co. has to be aware of the economy as with any industry. Within the recession, more and more were looking towards generic substitutes. This can at times not be a problem with patents. However, once a patent is up, a competitor who develops generic versions of Merck’s products becomes a low-cost competitor. However, during the recession from 2008 – 2009, Merck didn’t see any drop in sales. Actually, they were able to keep a continual increase in sales and net income.
Our book says: “A firm’s external environment consists of all the forces that can affect its potential to gain and sustain a competitive advantage. (Rothearmi, 2013) Analyzing the general environment, we can mitigate threats and leverage opportunities.
Third, a Japanese management style that depends on unrealized capital gains has become obsolete by international standards, and has made the new challenge difficult. The Japanese financial system of indirect financial intermediation, which is based on land as collateral, has been malfunctioning. A new business management as well as a new financial system that will fit the Japanese economy in the 21st century need to be established early, so that the abundant savings of Japan are best mobilized for economic development in the next century.
During the 1990s, Japan has been exposed to one of the most difficult structural transition periods in its post-war history, in terms of social and economic conditions. There have been two major changes: one is a substantial decline in economic growth in real terms, and the other is a changing social structure characterized by the declining birth rate and the ageing population. Under the pressure of changes in the economic environment caused by globalization and innovations in information technology, Japanese business corporations are forced to adapt to the new situation. While companies faced with fierce international competition, it became more critical to understand the basic knowledge of complicated legal, cultural, economic, and social issues. Engaging in international trade also requires attention to international regulations, international business planning, international market research, funding, distribution and other areas that must be considered separately from domestic business issues. The paper suggests some of the basic tools that can apply to solve the problem or to bring the business opportunity to fruition in today's Japanese business environment
First is the language communication problem. Thai is the official language of Thailand, all Thai laws and regulations are written in Thai, and this brings difficulties to foreign investors. And in local culture, people generally emphasis on the status and relationships, so it will increase the foreign investment in intangible costs.
I also found that new product development for international business is more challenging against the competitor. Because product life cycle was found to be shorter in international market due to increase level of competition. Moreover during the assignment work I never knew that cultural issue were to important in international