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prisoha
1 month ago
11

A small Canadian firm that has developed some valuable new medical products using its unique biotechnology know-how is trying to

decide how best to serve the European Union. Its choices are given below. The cost of investment in manufacturing facilities will be a major one for the Canadian firm, but it is not outside its reach. If these are the firm’s only options, which one would you advise it to choose? Why? Provide pros/cons for each option.
a. Manufacture the products at home and let foreign sales agents handle marketing.
b. Manufacture the products at home and set up a wholly owned subsidiary in Europe to handle marketing.
c. Enter into a strategic alliance with a large European pharmaceutical firm. The product would be manufactured in Europe by the 50/50 joint venture and marketed by the European firm.
Business
1 answer:
marusya05 [3.7K]1 month ago
7 0
Part a. Produce the goods in-house and allow international sales managers to oversee marketing. Advantages include: - Complete authority over production processes. - Simplicity in strategizing and scaling manufacturing. - Enhanced control over human resources. - Increased comprehension of European markets by foreign sales agents. - Reduced exit costs in case of product failure. Disadvantages consist of: - Limited knowledge regarding pharmaceutical protocols in Europe. - Risks to the brand's reputation if not correctly managed by foreign agents. - Extra expenses in product delivery. Part b. Produce the items in-house and establish a wholly-owned entity in Europe for marketing. Pros encompass: - Full oversight of manufacturing operations. - Ease in creating strategies and ramping up production. - Better human resource oversight. - Protection of brand integrity since marketing is managed internally. Cons include: - Increased resource allocation for marketing. - Insufficient information about pharmaceutical standards in Europe. - Extra delivery costs. Part c. Form a strategic partnership with a significant European pharmaceutical entity to manufacture products via a 50/50 joint venture for marketing. Pros involve: - Risk-sharing among the enterprises. - No additional costs for delivery. - Valuable insights into European regulations and marketing. Cons involve: - Diminished control over manufacturing. - Share profits among partners. - Moderate exit costs involved. - Possible brand image damage due to the additional firm.
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