- Select their forms of direct investment from the list below. Explain each and give examples of when to use them and use specific company example(i.e., Franchise –KFC reason why)
- Franchising this refers to a form where recognized business enterprise opens another company in a different company which is franchised to that sate. They should obey the rules and regulation of that state and adhere to the terms and conditions of that particular state. Majorly used by an organization to extend the business entities to different parts of the world. Example McDonalds and KFC have master Franchises in Indian
- Acquisitions this form of direct investment in which involves acquiring an existing foreign company. Majorly used to promote business since most people had already known the previous company well. Example the Tata’s acquisition of Jaguar Land Rover
- Greenfield, this form of direct investment, which involves the activities, started from scratch or assembling the elements from the beginning — majorly used when establishing a company which was not existing. Examples of the companies using the Greenfield is the Honda Company in the UK in which they assemble Honda elements.
- Name two trade organization and tell us the benefits of them to those participating them.
- World trade organization
- International trade organization
Members of the trade organization have lower barriers to trade among themselves in terms of the importation quotes, policies and regulations, and trade tariffs. Which lead to broader markets among the participants for the goods and services.
Trade organization creates s job opportunities to many participants since they can work in different states without many limitations which will improve the living standards of the people and growth of the economy.
- Provide and elaborate on the definition of an emerging market. List three of its characteristics
The emerging-market also term as emerging economies are the countries or nations which are investing more productively. They are getting rid of their traditional economies that have to relent more on the farming and exporting of the raw materials. The governments of these developing nations need to create a better quality of life for their people; they are aggressively industrializing and adopting new methods of agriculture.
Slow economic growth according to the emerging market this one of the features seen in many countries such as Germany and others
Lower than average per capita income, low income is the first crucial criteria because this provides an incentive for the second feature of rapid growth
High volatility this due to the natural disasters and domestics policy instabilities
- Analyze the external environment for Starbucks for its entry into Columbia, a major coffee producer in the world, use the business model canvas. Excel in explaining the process and element to look for.
- Define foreign direct investment
This involves assets allocated by a company or individual in one state into a business interest situated in a different state. As such, a stockholder launches a business entity or acquire foreign assets, including establishing ownership or controlling the interest in the external firm.
- What is Business Strategy?
Refers to plan and decision which a firm gears to secure a competitive position in the market. It is advantageous to entrepreneurs since it enables them to achieve their goals.