Strategic alliances, joint ventures, and cooperative agreements between domestic and foreign firms are a potentially fruitful means for the partners to enter additional country markets. gain better access to scale economies in production and/or marketing. fill competitively important gaps in their technical expertise or knowledge of local markets. share distribution facilities and dealer networks, thus mutually strengthening their access to buyers. All of these. The best place to look for cross-business strategic fits is in R&D and technology activities. in supply chain activities. in sales and marketing activities. in production and distribution activities. anywhere along the respective value chains of related businesses—no one place is best. One of the most viable strategic options companies should consider in tailoring their strategy to fit circumstances of emerging country markets include Try to change the local market to better match the way the company does business elsewhere Be prepared to modify aspects of the company’s business model to accommodate local circumstances Prepare to compete on the basis of low price Stay away from those emerging markets where it is impractical to modify the company’s business model to accommodate local circumstances All of these Diversifying into a new industry by forming a new internal subsidiary to enter and compete in the target industry is attractive when all of the potential acquisition candidates are losing money. it is impractical to outsource most of the value chain activities that have to be performed in the target business/industry. there is ample time to launch the new business from the ground up. the company has built up a hoard of cash with which to finance a diversification effort. none of the companies already in the industry are attractive strategic alliance partners. Diversifying into new businesses can be considered a success only if it results in increased profit margins and bigger total profits. builds shareholder value. helps a company escape the rigors of competition in its present business. leads to the development of a greater variety of distinctive competencies and competitive capabilities. helps the company overcome the barriers to entering additional foreign markets. The advantages of using a franchising strategy to pursue opportunities in foreign markets include having franchisees bear most of the costs and risks of establishing foreign locations and requiring the franchiser to expend only the resources to recruit, train, and support foreign franchisees. being particularly well suited to the global expansion efforts of companies with multicountry strategies. helping build multiple profit sanctuaries. being well suited to companies who employ cross-market subsidization. being well suited to the global expansion efforts of manufacturers. Once a company has diversified into a collection of related or unrelated businesses and concludes that some strategy adjustments are needed, which one of the following is not one of the main strategy options that a company can pursue? Stick closely with the existing business lineup Restructure the company’s business lineup Craft new initiatives to build/enhance the reputation of the company’s brand name Divest some businesses and retrench to a narrower diversification base Broaden the diversification base The reasons why a company opts to expand outside its home market include gaining access to new customers for the company’s products/services. spreading its business risk across a wider market base. achieving lower costs and enhancing the company’s competitiveness. a desire to capitalize on its core competencies and capabilities. All of these. The advantages of using a licensing strategy to participate in foreign markets include being especially well suited to the use of cross-market subsidization. being able to charge lower prices than rivals. enabling a company to achieve competitive advantage quickly and easily. being able to leverage the company’s technical know-how or patents without committing significant additional resources to markets that are unfamiliar, politically volatile, economically uncertain, or otherwise risky. being able to achieve higher product quality and better product performance than with an export strategy. With an unrelated diversification strategy, the types of companies that make particularly attractive acquisition targets are financially distressed companies with good turnaround potential, undervalued companies that can be acquired at a bargain price, and companies that have bright growth prospects but are short on investment capital. companies offering
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