Expansion Opportunity
Entering the Vietnam market was a rather controversial decision due to the presence of the factors such as corruption and bureaucracy. However, the opportunities that an educated workforce and comparatively low production costs opened for MNC in the economic setting of the Vietnam market made the specified endeavor worthwhile (Arnold and Quelch 1-2). With a well-developed resource management strategy and a proper understanding of the political, cultural, socioeconomic, and technological forces that defined its success in Vietnam, MNC had a standing chance to expand into the specified market (Arnold and Quelch 2-3).
MNC Entering Vietnam
For each MNC, the conditions of entering the Vietnam market are different. As a rule, several modes of entry are considered, including exporting, franchising, licensing, joint venture, and direct investment (Mehta et al. 638). Exporting implies the need to maintain communication between a range of stakeholders, which makes it suitable for sports-related businesses. Licensing requires a comparatively small number of investments (Arnold and Quelch 6). Therefore, the specified type of expansion also seems legitimate for sports. Franchising suggests branching out to semi-independent businesses, thus giving them more independence in decision-making. Consequently, franchising can be used as a tool for expanding the children-related business. As for the chemical business, direct investment, which allows for higher control over key processes, is advised (Arnold and Quelch 7).
MNC’s Success Factors in Vietnam
The success of MNC in Vietnam is determined by several factors. Political circumstances will define whether the organization will be allowed to implement essential business-related transactions (Robbins and Judge 71; Levitt 98). For example, the issue of bureaucracy will need to be addressed for the corporation to function in the identified setting (Arnold and Quelch 1) Socioeconomic issues will provide an insight into the lives of the target population and help to create an appealing brand image. Technological aspects of the firm’s functioning will give MNC a chance to make its products and services recognizable and well-known. Finally, an analysis of financial factors will make MNC design a comprehensive risk management strategy (Arnold and Quelch 5).
Works Cited
Arnold, David J., and John A. Quelch. “Vietnam: Market Entry Decisions.” Harvard Business Review, 1996, pp. 2-14.
Levitt, Theodore. “Globalization of Markets.” Harvard Business Review, 1983, pp. 92-102.
Mehta, Rajiv, et al. “Leadership and Cooperation in Marketing Channels: A Comparative Empirical Analysis of the U.S., Finland, and Poland.” International Marketing Review, vol. 18, no. 6, 2001, pp. 633-666.
Robbins, Stephen P., and Timothy A. Judge. Organizational Behavior. 16th ed. Pearson Higher Education AU, 2014. VitalSource Bookshelf E-book, Web.