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IGNOU IBO-02 Free Solved Assignment 2012
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TUTOR MARKED ASSIGNMENT
Course Code : IBO-02
Course Title : International Marketing Management
Assignment Code : IBO-02/TMA/2011-12
Assignment Coverage : All Blocks
Maximum Marks : 100
Attempt all the questions
1. An Indian company wants to enter into international markets. The company decided to involve another company in the foreign country. Explain the mode of entry where the involvement of foreign company is possible and state in which situations each of them is suitable. (20)
Solution: In an effort to sell their products and services to new customers, businesses will often attempt to enter new, foreign markets. Entry into a foreign country can be tricky, however, as the business must adapt to a new clientele, new legal regulations and new competition. To make for an easier transition, there are a number of common modes that businesses can use when starting up in a foreign market.
Joint Venture
One of the most popular modes of entry is the establishment of a joint venture, in which two businesses combine resources to sell products or services. Many countries with tightly controlled economies, such as China, often require foreign companies to partner with a local company if they wish to sell products to their residents. Although joint ventures provide foreign companies with a partner experienced in the foreign market, these partnerships can be difficult to manage and require a splitting of profits.
Licensing
In the licensing mode of entry, companies sign contracts with foreign businesses, called "licenses," that allow the foreign companies to legally manufacture and sell the company's products. The foreign companies will either purchase the license outright, pay a regular licensing fee or pay a percentage of their revenue over time in the form of royalties. Often used by manufacturing firms, licensing allows a company to enter a market quickly and
Presented by http://www.IGNOU4U.Blogspot.com
TUTOR MARKED ASSIGNMENT
Course Code : IBO-02
Course Title : International Marketing Management
Assignment Code : IBO-02/TMA/2011-12
Assignment Coverage : All Blocks
Maximum Marks : 100
Attempt all the questions
1. An Indian company wants to enter into international markets. The company decided to involve another company in the foreign country. Explain the mode of entry where the involvement of foreign company is possible and state in which situations each of them is suitable. (20)
Solution: In an effort to sell their products and services to new customers, businesses will often attempt to enter new, foreign markets. Entry into a foreign country can be tricky, however, as the business must adapt to a new clientele, new legal regulations and new competition. To make for an easier transition, there are a number of common modes that businesses can use when starting up in a foreign market.
Joint Venture
One of the most popular modes of entry is the establishment of a joint venture, in which two businesses combine resources to sell products or services. Many countries with tightly controlled economies, such as China, often require foreign companies to partner with a local company if they wish to sell products to their residents. Although joint ventures provide foreign companies with a partner experienced in the foreign market, these partnerships can be difficult to manage and require a splitting of profits.
Licensing
In the licensing mode of entry, companies sign contracts with foreign businesses, called "licenses," that allow the foreign companies to legally manufacture and sell the company's products. The foreign companies will either purchase the license outright, pay a regular licensing fee or pay a percentage of their revenue over time in the form of royalties. Often used by manufacturing firms, licensing allows a company to enter a market quickly and