The Pros And Cons Of The ABC Limited In India

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Before the ABC Limited enters India, they should choose a suitable entry mode (see appendix table 1). However, to enter other country has pros and cons. Just like Dunning’s eclectic theory mentioned that four factors affect the different choice of entry mode: ownership advantages, location advantages, internalization advantages and other factors, which are need for control, resource availability and global strategy (Griffin and Pustay, 2013). In appendix, the map 1 shows India is a big country that good for trade and start business, its own good prospects for market development. It also means India owns more population market to help enter manufacturing industry because in this kind of industry always needs many people to manufacture. And the import and export trade is more convenient. Therefore, the best market entry strategy is foreign direct investment, and the joint venture of that strategy is the first choice. “A joint venture is a special type of strategic alliance that have two or more firms join together to create a new business entity” (Griffin and Pustay, 2013). It also means through the joint venture, ABC Limited will own more high profit potentials, and “joint ventures are created when two or more firms agree to work together and create a jointly owned separate firm to promote their mutual interests” (Griffin and Pustay, 2013). It is a good opportunity to cooperate with other international firms, and it can have more cooperative objects from international

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