Is A Method Of Going Global In Which A Company Makes Agreements

Among the drawbacks of exporting are the costs of transporting goods to the country, which can be high and can have a negative impact on the environment. In addition, some countries impose tariffs on entries, which will affect the company`s profits. In addition, companies that market and distribute products through a contractual agreement have less control over these transactions and must of course pay a fee to their trading partner for these services. There are times when companies have opportunities in the global market that are best realized with a partner. Sometimes these projects are extremely large and capital-intensive, or so large that it makes sense to involve several companies, or even governments. These large global projects generally have one of two forms: strategic alliances or joint ventures. Outsourcing and outsourcing are the subject of ongoing public debate in both the United States and other countries. Supporters argue that these strategies benefit both sides of the agreement: free trade is improved, the destination country gets jobs and the country of origin receives cheaper goods and services. Some proponents go further by saying that outsourcing and outsourcing increase gross domestic product (GDP) and increase the total number of jobs, including domestically. This statement is based on the idea that workers who lose their jobs will change higher-paying jobs in sectors where the country of origin has a comparative advantage. In a greenfield company, the company enters a foreign market and creates a new subsidiary as a start-up. The BMW US Manufacturing Company, a vehicle assembly company in Greer, South Carolina, is part of the BMW Group.

Although it is BMW`s only assembly plant in the United States, it is a direct investment in the United States by the German manufacturer, and it is one of the most successful Greenfield projects in the United States. Partnerships in emerging countries can also be used for social welfare. The pharmaceutical company Novartis has established several partnerships with suppliers and manufacturers to develop, test and produce antimalarial drugs on a public utility basis. Partners included several Chinese suppliers and production partners, as well as a farm in Kenya that grows the main raw material for the drug.