International Entry Mode Strategy-Free-Samples-Myassignmenthelp

Question: Discuss about the International Entry Mode Strategy. Answer: Introduction The international business environment is highly competitive. Any organization seeking entry into the new markets needs a strategy on how to, establish, manage, export or import products and services(Jones, Coviello, Tang, 2011). The analysis of the new business environment calls for a comprehensive plan that highlights the strengths and weaknesses of the business as well as the host countrys advantages. There are a number of factors influencing the external and internal environment. This analysis is a focus on Rubric Waters plan to invest in the Western Cape part of South Africa. It studies the strengths and weaknesses of entry mode approaches and Rubicons internal capabilities. A closer look at the geographical region brings out Western Capes competitive advantage. A study of the external environment shows its potential. In order to understand the best entry mode the analysis weighs the FDI mode such as management contract, joint ventures, franchising, M A for the best approach(G runig Morschett, 2012). Company Background Rubicon Water is an Australian company from Victoria. This is a global venture seeking to open a branch in South Africa. Recently it signed a contract to venture into China; the company provides advanced technology using innovative software. It facilitates for irrigation through improved water management and channel distribution services. This enhances water equity and high performance irrigation agricultural investments that require less labour, energy and labour. It improves productivity through its technology hence it is reliable for district water supplies(Petzer, B; , 2013). Analysis of the New Market Western Cape South Africa as a new market is a dry region with water deficit. Statistics from the province reveals water deficit within useable dam capacity of less than 10%(Government of Capetown, 2017). However, the report points that the Western Cape Water Supply System has an untapped capacity. Advanced technology is a viable solution for this regions agricultural water use(Sumner Lybbert, 2011). This is because of the climatic disadvantages in the province. Rubicon provides a sustainable solution for public sectors such as agricultural development. Cape Town is home to the Philippi Horticultural Area of Cape Town that has 3074ha of arable land. The province is also at the frontline in energy efficient projects(Harris Spicer, 2017). Analysis of Foreign Direct Investment Entry Mode Currently Rubicon has signed a joint venture with Beijings Green Valley(Rubicon, 2017). Its plan in China uses the internet water strategy in partnership with the government for regional irrigation. This is ideal for China because the region is developed. On the other hand, a joint venture involves more parties in this case it accommodate the private owned Rubicon and the government of SA as well as local partnership. Shared ownership of this public service reduces on risks and improves the returns. Challenges with the Greenfield approach hinders its viability because low-income regions have low global liquidity. South Africa is not entirely a low-income region but its average economy is prone to economic hurdles. The Country does not feature among resource rich nations therefore a Merger and Acquisition is not viable. This decision is dependent on the economic and financial viability of SA and more so Western Cape region. The Western Cape is the heart of South Africas Agricultural sector and it stands out as a low employment region (Harris Spicer, 2017). This gives management an edge because it provides an opportunity for employment. A Wholly Owned Subsidiary (WOS) represents a company, which claims 100% ownership. This would not be a good idea because the South African and Local governments own shares in development projects. However, based on the challenges in South Africa, management contract is the best approach because it allows Rubicon to supply the pump to utility services in SA. This is perfect for developing countries, which need development and infrastructural support. SA has the expertise for managing the innovation and this is a low risk approach. It would provide employment for Western Cape. Effective FDI is also affordable and has direct benefits. Company Strategy Rubicon Water prides itself of a vision to increase the production of food and fibre production through efficient water use (Rubicon, 2017). The competitive edge for the brand is its advanced technology for irrigation systems. It facilitates for accurate measures of on-demand water supplied to farms and it can control open canal systems for limited outfalls. This reduces water wastage and erosion of fertile soil from farms. The company stands out as the only brand with an ability to enhance water usage with this technology on a large scale. This is a cost effective technology for the contemporary systems. The brand employs a highly skilled workforce including engineers, designers and technicians. The presence of the brand in SA enhances job creation. Company features The food security threat in Cape Town and SA is real (Faragher, 2013). The city continues to face threats of drought(van Dam, 2017). Rubicon needs to take advantage of the governments plan to combat the effects of drought for technology solutions. It has innovative technology, which Western Cape needs. Its innovation is a chance for social entrepreneurship in the region and it opens doors for further penetration in Africa, which has potential to become the Worlds food basket(Ridley-Duff Bull, 2015). Country specific business environment Western Cape is a trade and business hub in the region. Its local government has in place strategies for partnership with multinational companies and it has in place the right infrastructure asset and investment policies (Western Cape Government, 2014). Part of the governments strategy is improved sustainability for climate change. Its specific strategic objectives include leveraging its existing assets and capacity for more FDI. It encourage collaboration on critical policy issues. Conclusion Collaboration, innovation and engagement are at the canter of Rubicons values. This social enterprise does not focus on profit alone but value addition. Therefore, it stands a high chance of succeeding in this plan. However, its success depends on the implementation of strategy and the conducive environment for FDI. However, The Company needs to be ware of South Africas xenophobic tendencies when hiring its workers because its quest to hire experts may require expatriate services. References Faragher, T. (2013, October 9). Loss of Capetown farmland will be irreversible threat to food security. Future Capetown. Retrieved October 6, 2017, from https://futurecapetown.com/2013/10/loss-of-cape-town-farmland-will-be-an-irreversible-threat-to-food-security/#.WdfW2luCzDd Government of Capetown. (2017, October 2). City of Capetown: Water Dashboard. Retrieved from Capetown: https://resource.capetown.gov.za/documentcentre/Documents/City%20research%20reports%20and%20review/damlevels.pdf Grunig, R., Morschett, D. (2012). Evaluating market entry modes. Berlin Heidelberg. Harris, T., Spicer, M. (2017, June 14). Western Cape's push for growth and job creation gives SA a boost. Business Day. Retrieved October 6, 2017, from https://www.businesslive.co.za/bd/opinion/2017-06-14-western-capes-push-for-growth-and-job-creation-gives-sa-a-boost/ Jones, M. V., Coviello, N., Tang, Y. K. (2011). International entrepreneurship research (19892009): a domain ontology and thematic analysis. Journal of Business Venturing, 26(6), 632-659. Petzer, B; . (2013, August 6). Loosing farmland is forever. Retrieved from Future Capetown: https://futurecapetown.com/2013/08/losing-farmland-is-forever/#.WdfH81uCzDd Ridley-Duff, R., Bull, M. (2015). Understanding social enterprise: Theory and practice. Sage. Rubicon (b). (2017). About Rubicon. Retrieved from Rubicon Water: https://www.rubiconwater.com/usa-about Rubicon. (2017, April 12). Latest News. Retrieved from Rubicon Water: https://www.rubiconwater.com/news/765/rubicon-signs-ningxia-modernisation-mou Rubicon. (2017). We are dedicated to imrpoving gravity-fed irrigation. Retrieved from Rubicon: https://www.rubiconwater.com/ Sumner, D., Lybbert, T. (2011). Agricultral technologies for climate change in developing countries: Policy options for innovation and technology diffusion. Food Policy, 37(1), 114-123. van Dam, D. (2017, June 1). Cape contends with worst drought in over a century. CNN Metereologist. Retrieved October 6, 2017, from https://edition.cnn.com/2017/05/31/africa/cape-town-drought/index.html Western Cape Government. (2014). Western Cape Governement International Relations Strategy. Retrieved from Western Cape Governement: https://www.westerncape.gov.za/general-publication/western-cape-government-international-relations-strategy-0