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Problem

A small Michigan-based firm that produces and sells component parts to General Motors, Ford, and Chrysler Group LLC wishes to extend market coverage to Europe and Japan. What type of market entry strategy would provide the best fit?

Step-by-step solution

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Step 1/1

The small business firm can choose a strategic global alliance as the type of market entry strategy. A strategic global alliance is a business relationship between two or more companies to achieve a common goal. The company can opt for a partner in Japan and Europe to enter the respective markets.

The company can get to understand and utilise the technology used in the other countries. The company can also use economies of scale in manufacturing and marketing. The company has to coordinate with its partners to share ideas in marketing and product design.

The employee’s skill from different countries can be utilised to develop good products which would benefit the company and its partners.