You started an energy drink company in the United States that has been very successful. Your sales and profits have leveled off lately, and you and your management team are now researching introducing your drinks outside the United States. What market-entry strategies will you analyze if you want to keep your risk and initial investment low?
What will be an ideal response?
The least-risky strategies that do not involve a large investment and have a higher chance for success are exporting, licensing, and franchising. Exporting involves producing the product in the United States and then selling the products overseas through a distribution network. The energy drink company can license its formula to a foreign company for a fee and then the foreign company can produce and sell the drink in its marketplace. A franchisee in a foreign country can use the name, marketing, and product for a royalty payment, and then sell the product in its market.
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