In case two on the other hand the company preferred

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Unformatted text preview: Equity investment/ production Indirect and agent/distributor exporting or Branch/ subsidiary exporting Branch/ subsidiary exporting or equity investment/ production Indirect and agent/distributor exporting, licensing or Service contracts Branch/ subsidiary exporting or equity investment/ production High political risk Restrictions on investment abroad When placing the companies in case one and case two in Root’s (1994) table, our findings reveled that both companies have similar demands for the international market, such as high sales potential, good marketing infrastructure, restrictive import policies, dynamic economy 44 DATA ANALYSIS and low political risk. These factors are considered to be basic demand for interest in any international market. Furthermore, the factor of production cost is not relevant for case one as they produce all their products in their domestic market. In case two on the other hand, the company preferred low production cost although they adapt their prices to the cost of production. The geographical distance has no bearing on the decision of which international market to enter for neither company. In addition, exchange rate...
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