Biomed, a small Canadian firm, has created a valuable new me…

Biomed, a small Canadian firm, has created a valuable new medical product using its unique biotechnology know-how.  It is now trying to decide how best to serve the European Union.  Its choices are: manufacture the product in Canada and let European sales agents handle marketing;  manufacture the product in Canada and set up a wholly owned subsidiary in Germany to manage the marketing; or  enter into a strategic alliance with a large German pharmaceutical firm.  The product would be manufactured in Germany by the 50/50 joint venture and marketed by the German firm.  The cost of investment in manufacturing facilities will be an expensive move for the Canadian firm, but it is not outside its reach.  If these are the firm’s only options, which one would you advise it to choose?  Why?     

Neanderthal Iron makes exercise equipment and runs gyms and…

Neanderthal Iron makes exercise equipment and runs gyms and has decided to ‘go international’.  They don’t know what this means but everybody else is doing it so they don’t want to be left behind. They aren’t sure how to enter a foreign country.  Should they export?  Should they find a local firm who knows the market?  When should they enter and how big?  They also wonder how their exercise equipment and gym management style will work in other countries.  How will they negotiate over there?  What is ethical and what isn’t.  Of course, Neanderthal would prefer to enter countries with stable, democratic political systems and economies.  And they don’t want to face too much government protectionism.  Their CFO is particularly concerned about transacting in different currencies and how they should price their equipment exports. What are the four risks of international business faced by Neanderthal?  Explain how these apply to Neanderthal.