High School

With reference to the Jolson Automotive case and our class discussion, discuss the pros and cons (3 or more of each) of Jolson Automotive using each of the four major foreign market entry forms. You may want to use the following format when answering the question:

Export:
Advantages:
1)
2)
3)

Disadvantages:
1)
2)
3)

Answer :

Final answer:

Jolson Automotive can use export, licensing, joint venture, and foreign direct investment as foreign market entry forms. Each form has its own advantages and disadvantages.

Explanation:

Export:



Advantages:

  1. Access to new markets and customers
  2. Increased profit potential
  3. Reduced dependence on domestic market

Disadvantages:

  1. Language and cultural barriers
  2. Higher transportation costs
  3. Potential trade barriers or tariffs



Licensing:



Advantages:

  1. Low risk and reduced investment
  2. Access to local market knowledge and distribution channels
  3. Quick market entry

Disadvantages:

  1. Limited control over operations and brand image
  2. Dependence on licensee's performance
  3. Potential loss of intellectual property



Joint Venture:



Advantages:

  1. Access to local expertise and resources
  2. Shared risk and costs
  3. Enhanced market knowledge and understanding

Disadvantages:

  1. Potential conflicts and disagreements between partners
  2. Loss of control over operations and decision-making
  3. Shared profits and decision-making



Foreign Direct Investment:



Advantages:

  1. Greater control over operations and strategy
  2. Access to local market and resources
  3. Potential for higher long-term profits

Disadvantages:

  1. Higher initial investment and risk
  2. Potential political and economic instability in host country
  3. Potential cultural and language barriers

Learn more about Foreign Market Entry Forms here:

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