International Business-Class 2

International Business-Class 2 - International...

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International Business-Class 2 Things to consider in Location Selection -Transportation costs -Labor costs -Tariffs –when they are high they make you decide to product inside your country; in average tariffs can be high -Sometimes its cheaper to produce inside but infrastructure may not be great -Fully owned subsidiary-your own company is in control -Alliances -Comes down to how much your willing to share control with the company -Arguments over territory are sometimes the number one problems with alliances -Rentention pay out *If you have an alliance what are the means of exercising control over your partner? -By giving out license only for a limited time -Shareholding-majority holding doesn’t necessarily mean you will have full control -Key inputs-witholding supplies of what the other person needs; ex. Coca cola holding out on their syrup; the brand is more important than the product *Table 2 *why does the chart say very low foreign exchange in pros and as a con it says high exposure to foreign exchange ? -for the orders that you do know you can get a commitment from the bank for a 6- month loan but beyond 6-months you just don’t know because with floating rate changes -Transport costs as a percentage of value
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