Posted: December 4th, 2022
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As BFSI looks for entry to new proposed foreign markets, it is super important to identify the key criteria and considerations that need to be considered in evaluating entries to foreign markets, especially for financial companies like BFSI. The reason for this is because many countries take risk and reward into account, and the financial situation in every country can be different, and while some may offer great benefits, the risk associated, may not be worth it. In the study three determinants when figuring out which country a company should operate in are found in the eclectic paradigm. The three determinants stated in the eclectic paradigm are characterized by ownership, location, and internalization. The first one being ownership, which means having an owner specific competitive advantage, which no other company has, and when a company moves to this country, they can find immediate success using this advantage. The reason this factor is stated as being owner specific, is because it is something that should not be easily replicated or duplicated and with many risks that must be accounted for when working in another country, the advantage must be enough where this reward is immediate and ways out the cost. The second is location specific advantage, which means what characteristics does this location have that make it superior to other countries or locations. For example, if the cost for labor, and supplies is cheaper, but the quality of skilled labors are high, weather conditions could be a factor, laws that surround that location, market premiums, and growing markets. The third factor in the OLI model is internalization, which is the ability to go to a location and all operations maintain internal. One simple example of Internalization on a global level is McDonald’s ability to maintain an internal supply chain. This allows us to make changes and improve the quality of food, without the need to chase manufacturers and vendors to do so. For a financial company to maintain internalization, they can rely on foreign direct investment vs outsourcing.
answer the following question based on the elements that you read in the paragraph provided above: of the countries under consideration, which five would be most suitable for the immediate establishment of a BFSI subsidiary? Highlight the key issues for each of the selected countries and discuss the reasoning behind your recommendation.(choose five countries that you think are most suitable)(The countries are Costa Rica, Bosnia, Morocco,Vietnam, Norway, Senegal, Uruguay, Qatar, Papua New Guinea and South Africa)You can read the case that I attached to better understand.Answer length is one and have pages double space.
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