You work for a firm that has decided to exploit the possibilities that sales abroad can...

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Operations Management

You work for a firm that has decided to exploit thepossibilities that sales abroad can bring and want to become anactive exporter. You have 2 potential customers underconsideration:
a. The first customer you are considering is a potentially largecustomer in Malaysia where the business potential could be about15% of you current firm revenues per year for the next few years.This customer requires standard diesel machines, similar to theones you are already supplying to your customer base in theUSA.
b. The second is a potential customer in China. The futurebusiness potential is uncertain, however it could grow in thefuture or this could be even a one-off sale â€“ it depends on how thefirst few transactions are handled and the support provided to thecustomer. This customer requires diesel machines which will becustom built for the customer.
What channel (method of entry into the market) would you use ineach of the above cases? Justify your answer. What factors wouldyou consider in making the decision?

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Answer I work for a firm that has decided to exploit the possibilities that sales abroad can bring and want to become an active exporter My company have 2 potential customers under consideration In order to enter the foreign market various possible entry channels available for my company are as follows 1 Through the mode of joint venture where my company partners with the foreign company for selling the products into a particular market 2 Through the licensing agreements where my company signs an agreement with the foreign company and allows the foreign company to manufacture and sell the product 3 Through exporting directly See Answer

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