Discussion Questions

Where will you take ToolsCorp to Expand: a) will you go for manufacturing or b) will you go for selling, or c) will you go for both? To know this, you will have to determine what attributes your group feels are necessary for the expansion country. To know this, you will have to decide if this is your manufacturing or sales location, or both.  You must realize that manufacturers operate efficiently, so there will be no surplus inventory lying about in warehouses to sell and there will be no excess capacity in current manufacturing facilities to simply turn-on; so you must develop a manufacturing capability if you are going to sell. Certainly, you would want to ensure some basics—a stable government, foreign investor-friendly laws, a sufficient civil, social and technological infrastructure to support your firm, a skilled workforce capable of supporting your business, a consumer market where your products are in demand, a suitable supplier and distributer network, a suitable life-support system for key personnel and families, etc., ad infinitum.
What will you have ToolsCorp do there: a) how will you manufacture: i) greenfield, ii) JV, or iii) outsource; and b) how will you sell: i) large retailers, ii) your own retail outlets, iii) franchising, iv) online only; or v) some other method of sales? Again, the method in which you decide to manufacture and the way you intend to sell your products must be suitable to the attributes your expansion country(ies) possess. Additionally, ToolsCorp would likely choose a joint venture partner with whom to share risks since ToolsCorp is unfamiliar with global business practices. You will also need to decide how you will sell your products. Currently, ToolsCorp uses the large retailers (big boxers) for retail sales; would you change this current successful strategy or devise a different and better one? Research other manufacturers—some sell through franchisees, some through product-specific retailers, some through mail-order or online, some operate their own retail stores—you will see many ways to distribute and sell. Remember, the big boxers may use all the aforementioned methods. Do a cost-benefit analysis to help you decide which way of selling is best for ToolsCorp.

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