Developing a Sports Export Company

01. Is Sports trades alliance a multinational corporation? firmness of purposeMultinational corporations (MNCs) are defined as firms that engage in around form of outside(a) business concern. As the Sports Export caller sells it products to opposed countries & shell to global environment. So, the Sports Exports Company is a multinational corporation. 02. Why are the say-so apostrophizes lower for Sports Exports Company than for most MNCs? AnswerThe costs of ensuring that managers increase shareholder wealth (referred to as agency cost) are normally higher(prenominal) for MNCs than the agency cost of Sports Export Company.Agency costs are lower for Sports Export Company simply because the owner and manager are the same. The owner does non have managers who are based in other countries or counterbalance in the same country at very early stage. 03. Does Sports Exports Companyhaveany comparative advantage over potential competitors in unconnected countries that could fet ch grow and sell footballs there? AnswerObviously,the Sports Exports Company has a comparative advantage over potential competitors to other foreign countries.By applying an topic of producing low cost football and at the same time interchange those items on a wholesale basis was become very sure-fire in theU. S. Market. As the Sports Exports Company are producing the item for a enormous time, the company pull up stakes certainly enjoy some benefits like the advantages of macrocosm a first mover and at the same time entrusting be able to build a rapportwith customers. The Sports Exports Company will be the first firm to benefit from the popularity. The potential competitors initially will not get the advantages of becoming a first mover and lavish market shares.Also, the Sports Exports Company has a comparative advantage over theU. S. firms that release the top-of-the-line footballs in theU. S. market and it also sells the footballs at a low price. 04. How would Jim Logan make up peerlesss mind in which foreign markets he would attempt to enter? Should he initially attempt to focus on one or many foreign markets? AnswerJim Logan had previous experience about sporting goods shop and knew how to produce football. In addition to avoid any rent and labor expenses, Jim resolute to produce the footballs in his own garage and to perform the work himself.For these advantages, it facilitated him to make decision where he would attempt to enter. At first, he decided to take a firm that would produce low priced footballs and sell them on a wholesale basis to various sporting good stores in the coupled State and then gradually in foreign countries. To do so, Jim had to manage various factors such as the potential demand for footballs in for each one country and the potential degree of competition in that country. He initially may focus on one specific country when establishing his international business and gradually may expand his international business crossways several different countries.To focus much than one foreign country, broad distribution channel, capital machineries and even more manpower is needed. But as a single entrepreneur, it might not become possible for Jim to piece all of the things at a time rather it is better that he could find a distributor of sporting goods that would sell the footballs to retail stores in various countries. 05. The Sports Exports Company has no immediate plans to conduct direct foreign investment. However, it might consider other less costly methods to establish its business in foreign markets.What methods might the Sports Exports Company use to increase its charge in foreign markets by working with one or more foreign companies? AnswerThe Sports Exports Company may consider any one of the collaborative position like licensing, franchising or joint venture arrangement with other firms or industry. To make direct foreign investment, huge financial support and new arrangement are need ed. Considering of all the factors ratherthe Sports Exports Company may consider the above collaborative arrangement to reduce cost and maximize profit.