Advantages and Disadvantages of Modes of Entry to Foreign Ma

Exporting is the direct sale of domestically produced goods in another country. Exporting is a traditional and well established method of reaching foreign markets. Since exporting does not require the goods to be produced in the target country, no investment in foreign production facilities is required, which reduces risk if the project fails. Companies export primarily to increase sales revenue. However exporting also achieves economies of scale in production and allows th

Licensing mainly holds advantages for small companies as it allows them to enter foreign markets quickly, easily, and with virtually no capital investment.

• Some countries have different legal constrains which make it hard for some companies to product goods in that country. For example Mexican law requires foreign companies to share ownership with Mexicans.

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