M I B Essay Example | Topics and Well Written Essays - 500 words - 1

M I B - Essay Example arget markets, and political forces that would affect the organization’s decision to venture abroad; and (3) as long as there are potentials and opportunities in the local market, Wal-Mart wanted to tap these to build enough internal resources and financial capabilities to prepare for international expansion. During the early stages of its international expansion in the 1990s, Wal-Mart predominantly selected countries closest to its geographical location and where the profile of the target market share parallel behavior with those exhibited in the local markets. The first market it expanded to was Mexico, which was located just beyond their border. The rest of the countries were also close geographically, like Puerto Rico and Canada. Expansion to other countries such as Hong Kong, could have considered the nature of expanding markets and the vast opportunities that the target markets from this location could contribute to Wal-Mart’s international growth. The organization could have also considered the incentives provided by the international governments, including tax incentives or subsidies for setting up greenfield investments in these areas. Wal-Mart chooses between acquisitions, greenfield investments and joint ventures on the following grounds: (1) after considering costs of market entry; (2) cultural underpinnings; (3) government incentives and legal laws; (4) human resources expertise and capabilities; (5) familiarity with the environment; and (6) consumer profiles. Under greenfield investments, for example, Wal-Mart decides based on lack of potential targets to be acquired and there are local resources deemed experts to operate the organization. Joint venture, are most appropriate in cases where there has been an identified organization with competencies in the area and both partners could contribute their respective core competencies to result in longer term mutual gains. As indicated by the case facts, â€Å"a joint venture agreement rather than full