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  • Greenfield Invsestment

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    Talib Ah
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    Greenfield investments in new subsidiaries present significant challenges for multinational companies. Pre-incorporation challenges include carefully examining the host country for compatibility, quickly establishing local ties to overcome being foreign, ensuring the ability to sustain financial risk, and examining for first-mover advantages. Post-incorporation challenges involve maintaining local ties to not lose market contact and balancing integrating the subsidiary into the parent company while adapting to local customs. Managing subsidiaries demands extensive investments of financial and human resources.

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    Greenfield investments in new subsidiaries present significant challenges for multinational companies. Pre-incorporation challenges include carefully examining the host country for compatibility, quickly establishing local ties to overcome being foreign, ensuring the ability to sustain financial risk, and examining for first-mover advantages. Post-incorporation challenges involve maintaining local ties to not lose market contact and balancing integrating the subsidiary into the parent company while adapting to local customs. Managing subsidiaries demands extensive investments of financial and human resources.

    Copyright:

    Attribution Non-Commercial (BY-NC)
    Download as PPTX, PDF, TXT or read online from Scribd
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    14 views3 pages

    Greenfield Invsestment

    Uploaded by

    Talib Ah
    Greenfield investments in new subsidiaries present significant challenges for multinational companies. Pre-incorporation challenges include carefully examining the host country for compatibility, quickly establishing local ties to overcome being foreign, ensuring the ability to sustain financial risk, and examining for first-mover advantages. Post-incorporation challenges involve maintaining local ties to not lose market contact and balancing integrating the subsidiary into the parent company while adapting to local customs. Managing subsidiaries demands extensive investments of financial and human resources.

    Copyright:

    Attribution Non-Commercial (BY-NC)
    Download as PPTX, PDF, TXT or read online from Scribd
    Flag for inappropriate content
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    Greenfield Invsestment

    Challenges

    Challenges
    Subsidiaries are the hardest to manage and demand extensive investments in financial and human resources Theodor Peridis, 1992

    Challenges
    Pre-incorporation
    Carefully examine host country characteristics to ensure they are compatible with existing company operations; Quickly establish local ties (with suppliers and distributers) to overcome the liability of foreignness; Ensure their organizations ability to sustain full financial risk for the venture; and Examine for potential first-mover advantages.

    Post-incorporation
    Maintain local ties in order not to lose contact with the local market place; and Ensure a balance between integrating the new organization into the existing multinational framework of the parent company and adapting to local customs.

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