Answered: Drag each of Bean's options to the…

Principles Of Marketing

17th Edition

ISBN:9780134492513

Author:Kotler, Philip, Armstrong, Gary (gary M.)

Publisher:Kotler, Philip, Armstrong, Gary (gary M.)

Chapter1: Marketing: Creating Customer Value And Engagement

Section: Chapter Questions

Problem 1.1DQ

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Transcribed Image Text:A firm can choose from several approaches when entering a foreign market. Many firms follow a progression in which they begin with a less risky strategy to enter their first foreign market and move to increasingly risky strategies-which usually offer greater profit potential as they gain confidence in their abilities. This activity is important because the specific strategy chosen will vary according to the level of risk the firm is willing to assume. The goal of this exercise is for you to understand the types of actions that correlate with different types of global entry strategy. First, read the action steps that Bean, a U.S. national coffee chain, took to enter its first international market in South America. Then click and drag each action to the entry strategy that best represents that action. A U.S. national coffee chain called Bean is reviewing the various strategies it could use to enter its first international market in South America. The company is aware that different foreign market entry strategies offer different levels of control and profit potential, but its executives are primarily concerned with the risks involved in each strategy. Bean, is analyzing the risk of each of the following options for expanding into a foreign market: 1. It could partner with Olé, a local bakery chain, to create a new company together (requiring Bean to manage a partner relationship). 2. It could ship the product to be sold by a wide array of coffee shops (involving high shipping costs). 3. It could sell the name and format of the company to individual businesspeople to operate on their own (giving Bean limited control over stores and lowering its potential profits). 4. It could open, manage, and operate its own stores. 5. It could collaborate with a group of food chains to boost branding (though Bean might harm its reputation through negative brand associations). Drag each of Bean's options to the corresponding entry strategy Partner with Olé Export Collaborate with group Franchising Sell name/format to businesspeople Strategic Alliance Ship coffee to coffee shops Joint Venture Open own stores Direct Investment

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