From this point on two new concepts equity modes and

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From this point on two new concepts: equity modes and FDI Exporting / Importing Licensing Franchising Strategic Alliances (SAs) Joint Ventures (JVs) Wholly Owned Subsidiaries (WOS) Buy-out Greenfield Non- equity modes Equity modes + FDI
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Copyright    Dr. Tomasz Lenartowicz     Goods (z) Country A ( home country ) Country B (host country) Joint Venture (forming a new firm) Partner in Z Firm X Partner in Z Firm Z something new FDI Firm Y
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Copyright    Dr. Tomasz Lenartowicz     Goods (Z) Country A ( home country ) Country B (host country) Strategic Alliance Firm X FDI ? Firm Y Profits from the agreement NO
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Copyright    Dr. Tomasz Lenartowicz     Goods (Y) Country A ( home country ) Country B (host country) Wholly Owned Subsidiary (100% of ownership) (W.O.S.) Firm X Firm Y Firm Y profits FDI 100%
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Copyright    Dr. Tomasz Lenartowicz     Goods (Y) Country A ( home country ) Country B (host country) Wholly Owned Subsidiary (100% of ownership) (W.O.S.) Firm X Firm Y Firm Y profits FDI something new: W.O.S. -“Buy-out”
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Copyright    Dr. Tomasz Lenartowicz     Goods (Y) Country A ( home country ) Country B (host country) Wholly Owned Subsidiary (100% of ownership) (W.O.S.) Firm Y Firm Y profits FDI Other way to go: W.O.S. ‘Greenfield”
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Copyright    Dr. Tomasz Lenartowicz Modes of Entry EXTERNAL (Does not involve FDI, small risk ) Exporting / Importing Licensing Franchising Strategic Alliances (non-equity partnerships) INTERNAL (These involve FDI) JV (joint ventures) (equity partnerships) WOS = wholly owned subsidiaries (100%) (Firms own 100% of shares in a foreign country) Buy-out = Acquisition Greenfield Mergers and acquisitions ?
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Copyright    Dr. Tomasz Lenartowicz Which mode is best?
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