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Unformatted text preview: • Co-production agreements 3 INTRODUCTION
Investment Entry Modes
• Solo venture: new establishment
• Solo venture: acquisition
• Joint venture: new establishment/ acquisition
Root (1994) argues that export entry modes differ from the other two primary entry
modes (contractual and investment) in that a company’s final or intermediate product is
manufactured outside the target country and subsequently transferred to it. Thus
exporting is confined to physical products. Further Root (1994) states that contractual
entry modes are long-term non equity associations between an international company and
an entity in a foreign target country that involve the transfer of technology or human
skills from the former to the latter. The third kind of entry mode is stated by Root (1994)
to be the investment entry mode, which involves ownership by an international company
of manufacturing plants or other production units in the target country. In terms of
ownership and management control (which is the distinctive feature of this entry mode),
foreign production affiliates may be classifie...
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This document was uploaded on 03/22/2014.
- Summer '14
- The Land