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Joint Venture As Chosen Entry Mode From the Hollensen value chain perspective, a joint venture seems to be the best choice of entry for NovaBlend Creations as it enables NovaBlend Creations to optimize its production and distribution functions while tapping into the local market insights and capabilities of the Dutch partner. Collaborating through joint ventures can facilitate entry into new markets. By leveraging the partner's existing market presence and customer base, businesses can expand their reach and capitalize on growth opportunities that may have been otherwise inaccessible. (Exploring the Pros and Cons of Joint Ventures, 2023) NovaBlend Creations can contribute its expertise in tea blending and production, ensuring the quality and authenticity of its products, while the local partner can assist with market research, branding, sales, and distribution within the Netherlands. The success of a JV is highly dependent on the discussions that happen before the deal is signed. A well-designed JV can often realize greater value with less risk and lower operating costs. The key to maximizing value, however, lies in both parties applying an investor mindset, recognizing the hurdles that must be addressed, and committing the necessary resources and vision. This kind of full-scale support is the key to unlocking the true potential of a joint venture. (Khubchandani & Gore-Randall, 2024) A joint venture entry mode presents several strategic advantages. NovaBlend Creations can take advantage of the local partner's understanding of the Dutch market, including customer preferences, distribution channels, and regulatory needs, by forming a joint venture with them. By joining forces with a local organization, NovaBlend Creations is able to access important networks, resources, and knowledge that can help it enter new markets and expand more quickly in the Netherlands. In order to fully reap the benefits of a joint venture, which include pooling resources and risks, NovaBlend Creations must carefully choose a reliable partner that shares its beliefs and aspirations. Direct Investment As Second-Best Choice In comparison to the joint venture entry strategy, direct investment provides NovaBlend Creations with entire autonomy and ownership of its operations in the Netherlands. This implies the corporation has complete control of its production, distribution, marketing, and branding activities, resulting in more consistency and alignment with its worldwide business objectives. Other positive effects associated with inward direct investment include increased employment, improved productivity, technology and knowledge transfer, and overall economic growth (Back to Basics - Finance & Development, 2015) Furthermore, direct investment may yield higher long-term returns on investment because earnings created in the Netherlands remain within NovaBlend Creations' management.

However, direct investment often necessitates significant financial resources, time, and effort to establish and efficiently run the subsidiary. NovaBlend Creations would have to manage legal and regulatory constraints, cultural differences, and operational problems on its own, which can be complex and costly, particularly in a foreign market like the Netherlands. Rejection of Direct Investment Considering these factors, NovaBlend Creations decided against using direct investment as their main method of entrance into the Netherlands. The difficulty, hazards, and resource needs involved in establishing and running a wholly-owned subsidiary outweigh any possible benefits, especially for a relatively small and specialized business like NovaBlend Creations, even while it offers advantages in terms of ownership and autonomy. A more pragmatic and effective approach to penetrate the Dutch market would be to establish a joint venture with a local entity. This way, the risks and benefits can be shared with a reliable partner while utilizing local networks, resources, and knowledge. Benefits of Joint venture In a joint venture entry mode, the placement of value chain functions is designed to support and benefit potential customers in the following ways: Production: By collaborating with a local company in the Netherlands, NovaBlend Creations can use the partner's understanding of local tastes, preferences, and regulations to create artisanal blended teas that appeal to Dutch consumers. This guarantees that the teas fit local quality requirements and preferences, hence increasing customer happiness and loyalty. Distribution: Joint ventures frequently provide access to existing distribution networks and channels in the target market. NovaBlend Creations can ensure effective and timely delivery of its teas to customers throughout the Netherlands by leveraging its local partner's distribution infrastructure. This increases accessibility and availability, making it easier for clients to buy NovaBlend Creations products. Marketing: By working with a local partner, NovaBlend Creations is able to successfully adapt its marketing methods to the Dutch market. Due to the partner's comprehension of regional media outlets, consumer behavior, and cultural quirks, NovaBlend Creations is able to create marketing campaigns that are specifically tailored to the Dutch market. This raises consumer acquisition and retention as well as brand awareness and engagement.

Drawbacks of Joint venture Yes, there are some drawbacks of joint venture to the customers which are: Inconsistency: Variations between NovaBlend Creations' and its joint venture partner's management approaches, goals, or priorities may result in inconsistent brand experiences, customer service, or product quality, which may have an effect on customer satisfaction. Limited influence: Depending on the specifics of the joint venture agreement, NovaBlend Creations may have restricted influence over certain commercial areas, such as pricing choices, marketing plans, or distribution routes. If the partner's decisions conflict with NovaBlend Creations' standards or goals, this loss of control may have an impact on the client experience. Lack of influence over consumer Experience: Depending on the specifics of the joint venture agreement, NovaBlend Creations may have restricted influence over certain elements of the consumer experience, such as price, promotions, or retail atmosphere. Customer discontent and a loss of brand credibility may result from the partner's decisions if they are at odds with NovaBlend Creations' brand values or expectations. Entry Mode Phasing NovaBlend Creations will start with a joint venture to expand into Netherlands to test market demand and establish relationships, then gradually transition to other entry modes such as franchising, acquisition or wholly-owned subsidiaries as they gain confidence in the market and achieve specific performance targets in the Netherlands. By phasing entry modes, NovaBlend Creations can optimize their international expansion strategies, minimize financial risks, and capitalize on emerging opportunities in Netherlands. This approach allows NoveBlend Creations to mitigate initial risks associated with international expansion while retaining the flexibility to adjust their strategies based on market conditions and performance outcomes in Netherlands.

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REFERENCES Exploring the Pros and Cons of Joint Ventures. (2023, December 16). Pros Versus Cons. https://pros-versus-cons.com/financial-business/entrepreneurship/joint-venture/ What Is Direct Investment? - Back to Basics - Finance & Development, September 2015. (2015, August 27). https://www.imf.org/external/pubs/ft/fandd/2015/09/basics.htm Khubchandani, R., & Gore-Randall, E. (2024, February 21). Capturing the Value of Joint Ventures . BCG Global. https://www.bcg.com/publications/2024/capturing-and-optimizing-joint- venture-value

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