You are the international manager of a U.S. business that has just developed a r

Question

You are the international manager of a U.S. business that has just developed a revolutionary new personal computer that can perform the same functions as existing PCs but costs only half as much to manufacture. Several patents protect the unique design for this computer. Your CEO has asked you to formulate a recommendation for how to expand in Western Europe. Your options are: to export from the United States to license a European firm to manufacture and market the computer in Europe to set up a wholly owned subsidiary in Europe Evaluate the pros and cons of each alternative and suggest a course of action to your CEO.

Explanation / Answer

Various options available for the company are to expand in Western Europe are:

We would eveluate each options with their pros and cons:

To export from US

Pros:

Cons:

To license an European company to manufacture

Pros:

Cons:

To set up a wholly owned subsidiary in Europe

Pros:

Cons:

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