The Core Factor Of Business Culture Commerce Essay

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Culture is obviously a core factor in order to make marketing policies. Marketing is the best opportunity to raise your business and attract customers but marketing techniques have differences according to the cultural environment. Good marketing improves the sale of business and also make goodwill. In order to make efficient marketing the organization must know all about the culture of the country or more specifically the culture of that area where you are starting business. Marketing means different ways to attain more customers so if they have good knowledge of values, norms, living style, of that area then it is easy to introduce and promote your product. Culture plays a vital role in design of marketing strategies. Culture is the most effective strategy for any company because with help of culture company made those things which are acceptable or like by the people of those country are this is their religious factor like if any company made jainamaz for Muslim countries it is acceptable and Sale more than from no Muslim country, so we can say that culture is the strategy of marketing. Because according to cultures history the surviving of living of people at any atmosphere is their culture. Cultures explores the theoretical and practical implications of thinking local but acting global. The cultural differences affects international marketing including consumer behavior, market research, product and price policies, channel decisions and marketing communications.

Culture is a problematic issue for many marketers since it is inherently nebulous and often difficult to understand.  One may violate the cultural norms of another country without being informed of this, and people from different cultures may feel uncomfortable in each other's presence without knowing exactly why (for example, two speakers may unconsciously continue to attempt to adjust to reach an incompatible preferred interpersonal distance).

We considered several cultural lessons in class; the important thing here is the big picture. 

Culture is so pervasive, yet complex that it is difficult to define in short simple

terms. It seems there are as many definitions of culture as there are anthropologists

and social scientists, each defining it to suit his understanding and interpretation. To

some, the term refers to finesse in self comportment. "A cultured person is one who

behaves in a becoming way according to his society's standard of behaviour, a gentleman,

a well brought up lady, one that is so wholistically educated that he is at

home with any given subject of discussion in art, music, literature, politics etc., who

has cultivated taste for what society judges admirable and worthy of the human

spirit" (Umoren, 1996).

To others, culture refers to masquerades, traditional dances, festivals, traditional

marriage etc. In this instance, fierce arguments in defence of polygamy, violence in

masquerades, violence and extraordinary spending in the burial of the dead, etc. are


heard of in the name of "our culture." According to Howard & Sheth (1969), culture

refers to the "collective mental programming which people in a society have. This

means that every individual's activities are directed by his or her own culture.

Culture is also seen as selective man-made way of responding to experience, a set of

behavioural pattern which means that culture influences or affects motives, brand

comprehension, attitudes and intention to use. Thus culture is not only a narrow

view of man's activities, but extend to include all the activities which characterise

the behaviour of particular communities of people-the way they eat, how they talk,

look and general behavioural pattern".

Hawkins et al. (1983) defined culture as that complex whole which includes

knowledge, beliefs, arts, law, morals, customs and any other capabilities and habits

acquired by man as a member of society. To Hawkins et al., term, "acquired by

man" means that culture is socially learnt. The researcher therefore looks at culture

as a total way of life of people living together. Every individual is subject to his or

her culture, that is, the way people live, eat, dance, believe, dress, sing, etc. The general

patterns of behaviour by people accepted by them are influenced by their culture.

Every form of culture is identified in term of language (Umoren, 1996). Language

is a vehicle of culture. In short every language serves as a vehicle of the culture of

the people who speak that language. In Nigeria there are 374 ethnic languages and

groups. Some languages are found in more than one state. For example Yoruba is in

six states, Igbos in four states, and Annang, Efik and Ibibio in two states. Hausa cuts

across all the states in the North.

These languages effects consumer behaviour. To make consumer accept a product,

language is used to promote the product. Advertising, personal selling, sales

promotion and publicity cannot be effectively used without language. The MNC

needs to understand this in going into any nations for any type of business.

Adopting the symbolic theoretical approach, Umoren (1996) treated religion as a

cultural system and defined culture as systems of symbols and meaning. There are

three main religions in Africa: Traditional religion, Christianity and Islam. The

development of man cannot be completed without one type of religion or another. In

Nigeria, Christianity dominates the South, while Islam dominates the North and the

traditional exists in both areas.

Religions affect consumption behaviours and the purchase pattern of the individual.

For instance, Islam in the North does not allow beer parlours and imbibement of

alcohol, whereas in the South beer are sold everywhere. Because of religion some

married women cannot move publicly as they like. All these affect the MNC marketing

performance. They must adapt their product and promotion to suit their area of


According to Busch & Houston (1985), values are enduring beliefs that guide

behaviour in specific situations. A value exists mainly at the individual level, but

when it is substantially shared throughout a society, it becomes a cultural value.

Knowledge of the socio-cultural sector in terms of cultural values is crucial to marketing,

because cultural values influence the behaviours of most individuals in consumption

situations. As cultural values shift, so will motives for buying products,

and so the firm that fails to recognise this will overlook opportunities for new prod-

The Effect of Culture on Marketing Strategies of Multinational Firms 95

ucts or changes necessary in existing ones.

Cultural values are widely held beliefs that affirm what is desirable and have an

impact on activities (Hawkins et al., 1983). These values affect norms, which specify

an acceptable range of responses to specific situations. The beliefs, cultural values

and norm in different countries show great variation. For instance, most

Americans still believe in work, in getting married at appropriate age, in giving

charity and in being honest. Some Nigeria people in the North can marry from the

age of twelve. When products are introduced into one country from another, acceptance

is far more likely if there are similarities between the two cultures.

Connotations associated with body motions, greetings, colors, numbers, shapes,

sizes and symbols vary considerably across cultures (Pride & Ferrell, 1985), and

these cultural differences have marketing implications that pertain to product development,

personal sales, advertising, packaging and pricing.

The home country of the multinational enterprises is usually the base of expansion

and initial development of the firm. It houses the parent office, otherwise called

the headquarters. The host country is where multinationals have their subsidiaries.

According to Berham (1969), the characteristics of multinational firms are that

they attempt to treat the various markets as one, to the extent to which the host

countries government permit. They also respond to the market opportunities around

the world and try to pull together various elements of the enterprises to take maximum

advantage of its managerial know-how, advanced techniques and coordinated

marketing. Finance functions, product differentiation, extensive advertising,

advanced technology and managerial know-how are part to their known characteristics.

Once a firm decides to be involved in international arrangements, management

must decide which operational structure will be employed to implement this international

venture. The structure depends upon whether the foreign arm is intended to

remain as a secondary appendage to the parent body or whether management is

interested eventually in developing a fully integrated world marketing enterprise.

Nwokoye (1981) identified that the choice of a given structure is a function of

both internal and external variables. The internal variables include: financial capacity,

established corporate policies, size and experience in foreign operations. The

external variables may include: economic and marketing information, legal restrictions,

non-tariff barriers and political, social and cultural factors. However, six basic

kinds of structure or involvement include: exporting, licensing, contract manufacturing,

management contracting, joint venture and wholly owned subsidiaries.

McCarthy & Perreault (1984) viewed marketing strategy a "big picture" of what a

firm will do in some market, made up of two inter-related parts-the target market

and the marketing mix. The target market is a fairly homogenous (similar) group of

customers to whom a company must appeal to while the marketing mix is the controllable

variables, which the company puts together to satisfy this target group.

Pride & Ferrell (1985) saw a marketing strategy as that which "encompasses

selecting and analysing a target market (the group whom the organisation wants to

reach) and creating and maintaining an appropriate marketing mix (product, distribution,

promotion and price) that will satisfy those people". In this instance, a marketing

strategy forms the core of a successful marketing plan. It articulates a plan for


the best use of the organisation resources and advantages to meet its objectives.

When choosing a target market, marketing managers try to evaluate possible markets

to see how entering them would affect the firm's sales, costs and profits. They

also attempt to determine, if the organisation has the resources to produce a marketing

mix that meets the needs of the particular target market and whether satisfying

those needs is consistent with the firms overall objectives. They also analyse the size

and number of competitors who already are selling in the possible target market.

The target market therefore, is a group of persons for whom a firm creates and maintains

a marketing mix that specifically fits the needs and preferences of that group.

For example, within the Muslim tradition, the dog is considered a "dirty animal, so portraying it as "man's best friend in an advertisement is counter-productive.  Packaging, seen as a reflection of the quality of the "real product, is considerably more important in Asia than in the U.S., where there is a tendency to focus on the contents which "really count." Many cultures observe significantly greater levels of formality than that typical in the U.S., and Japanese negotiator tend to observe long silent pauses as a speaker's point is considered.

In japans culture there is a CEO office is between all the offices and small but in US culture CEO office big and are in side.

Now I would like to raise few points so that it will be explained more easily

Consumer Behaviour

The psychology of how consumers think, feel, reason, and select between different alternatives (e.g., brands, products);

The psychology of how the consumer is influenced by his or her environment (e.g., culture, family, signs, media);

The behavior of consumers while shopping or making other marketing decisions;

Limitations in consumer knowledge or information processing abilities influence decisions and marketing outcome; 

How consumer motivation and decision strategies differ between products that differ in their level of importance or interest that they entail for the consumer; and

How marketers can adapt and improve their marketing campaigns and marketing strategies to more effectively reach the consumer.

Marketing Activities Affected By Culture

Product Offering

Personal Sale

Marketing Research

Sales Promotion


Pricing Method


3 Social and cultural factors

Social and cultural factors influence all aspects of consumer and buyer behavior. The difference between these factors in different parts of the world can be a central consideration in developing and implementing international marketing strategies. Social and cultural forces are often linked together whilst meaningful distinctions between social and cultural factors can be made in many ways by the way the   two interact and the distinction between the various factors is not clear cut. Differences in languages can alter the intended meaning of a promotional campaign and differences in the way a culture organizes itself socially may affect the way a product is positioned in the market and the benefits a consumer may seek from that product.

A sewing machine in one culture may be seen as a useful hobby but in another culture a sewing machine may be necessary to the survival of a family.

Kotler (2003 included such things as reference groups, family roles and status within social factors. Whilst this is a useful distinction from the broader   forces   of culture, social class and social factors are clearly influenced by   cultural factors.

For Example

If a family which is an important medium of transmitting cultural values. Children learn about their society and culture through many means but the family influence is strong particularly

during the early years of a child's life. Furthermore the way in which   family life is arranged varies considerably from one culture to another. In some cultures the family is a large extended group encompassing   several generations and including aunts and uncles whilst in other cultures the family is limited more precisely to the immediate family of procreation and even then the unit   might not be permanent the father and mother of the children   might not remain together   for the entirety of the child rearing process.


The firms indicated that cultural various exerted varied influence on marketing

strategies used by the multinational firms, which called for the use of specific strategies

for particular situations and influences.

The firms also indicated that marketing strategies were adopted to purposely overcome

competition for more market shares and improved sales, and to stand the test

of the ever-changing trends as it affected demand and supply. Some of the strategies

included the use of quality products, frequent advertisement in local media, ideal

pricing structure, reward sales promotion and new product innovations.

Finally, all firms had adopted some useful remedies to overcome cultural influences

affecting their operations. These include: product adaptation, promotional

adaptation and new product innovation with the above in use.


The following recommendations are advanced to assist the multinational firms

and meet the dynamic nature of demands.

1. They should hold fast to the marketing concept, which focuses on the identification

of the needs and wants of target customers, and finding means to satisfy

it. By so doing, both current and latent needs will be satisfied.

2. They should concentrate on the production of particular product items that

would be specific to various cultural settings.

3. Their promotion programmes should be culture bound to the targeted indigenous

people and their interest.


Berham, J. 1969. Some Patterns in the Rise of Multinational Enterprises. John Wiley &

Sons, New York.

Hawkins D.I., R.J. Best & K.A. Coney 1983. Consumer Behavior: Implications for

Marketing Strategy. Business Publications, Plano, Texas.

Howard, J.A. & J.N. Sheth 1969. The Theory of Buyer Behavior. John Wiley & Sons, New


Kolde, E.J. 1968. International Business Enterprise Englewood Cliffs, Prentice-Hall New


McCarthy, E.J. & W. E. Perreault, Jr. 1984. Basic Marketing: A Managerial Approach. 8th

Edition. R.D. Irwin, Homewood, Illinois.

Nwokoye, N.C. 1981. Modern Marketing in Nigeria. Macmillan Press, London.

Busch, P.S. & M.J. Houston 1985. Marketing: Strategic Foundations. R.D. Irwin,

Homewood, Illinois.

Pride, W.M. & O.C. Ferrell 1985. Marketing: Basic Concepts and Decisions. Houghton

Mifflin, Boston.

Stopford, J.M. & L.T. Wells, Jr. 1972. Managing the Multinational Enterprises. Basic

Books, New York.

Umoren, U.E. 1996. Anthropology Contextualised in Nigerian Peoples and Culture. An

Unpublished Monograph, RSUST, Port Harcourt.

Q # 2 Experience must count in every field of life. Marketing needs a lot of experience because its very difficult to convince anyone and make customers. As we explained above that culture affects a lot in marketing like this there are also other factors which affects marketing. Experienced person can make good decisions at the right time and improve the ways to sell the products. There are different types of market and the marketers have to know about the market. Experienced person can easily focus its customers and can satisfy them whereas inexperienced marketers cannot take the right step on the right time. Culture varies place to place, like the culture of Europe is different from the culture of asia this is the prominent difference but if we talk about those areas where culture don't have many difference but still there will be some aspects which make slight difference in culture of the area. Culture differs due to people, their living style, their taste their requirements. Now the experienced marketers can know the slight difference in the culture but inexperienced marketers cannot know and the flop in this illusion because of similarity in the culture. Forexample if the organization is going to introduce the product in Islamabad they do their best to sell the product and they got success but when they move to Lahore although there is not much difference in the culture of Islamabad and Lahore but there must be slight difference which the inexperienced marketers cannot judge this similarity of illusion. Most of the time there is no difference in the aspect of culture but inexperienced marketers face difficulties in knowing about the different aspects of culture.

Assignment # 02

The evolving world of international business is witnessing the emergence of additional players, including firms from the former Eastern block. These firms are playing a game of catch-up as they attempt to learn the intricacies of doing business in today's global economy. The speed at which this process is occurring varies across nations. Firms in Slovenia, the Czech Republic and Hungary, for example, are rapidly acquiring the skills necessary to compete on the world stage. These firms have adopted both general approaches to marketing as well as targeted actions, which have been influenced by the local environment. This article will discuss the possibility of standardizing marketing programs and the factors influencing the process of cost lessening, as they apply to the case of Slovenian firms.


The literature in this area broadly examines the numerous variables that affect standardization. Both internal and external components impinge upon the decision to standardize the marketing program of product, price, distribution and promotion (Kreutzer, 1988). The magnitude of differences in local physical, economic, social, political and cultural environments, are being invalidated by the globalization of markets. As a result, there may be no differences between domestic and international marketing (Perry, 1990). However, a standardized marketing cannot be set once and for all. Matching firms' resources with environmental requirements, anticipating changes in consumers' needs, and forecasting competitors' behavior (Easton, 1988; Kogut, 1988) are critical business activities for developing effective standardized export marketing initiatives (Akhter and Laczniak, 1989).

The challenges facing MNEs in emerging market

According to Ghauri and Holstius, a company is entering international markets there are dissimilarities in the economic, political, legal and cultural environments that pose incentives for, as well as obstacles to,successful expansion. These differences are especially large in transition economies. This section will focus on the some major challenges that facing by multinational companies in emerging market.

Political and economic environment

The stability of political and economic environment is the key elements to influence the investors'decisions. At the recent decade, the political situation in emerging markets has favoured foreign investment. Mexico's open door policy of the early 1990s attracted significant inflows of foreign investment. However, in several transition economies, an ongoing problem faced by entrants into emerging market is their political and economic unpredictable. In China, as an example, has been in the process of developing a 'socialist market economy with Chinese characteristics '. The government maintain control and monopoly over the major sectors including railways, post and telecommunications and allowing private in manufacturing and service sector. In practice, this means that the current constitution (of a one party dictatorship and mainly state ownership) and the legal regime (with its lack of transparency) will resist political reform even though economic reform has deepened since 1992. (Roger strange, Hui Tan) These disaccord of political and economic reform have been created many uncertainty for foreign investment, such as changeable economic policy, market protection as a method of local government to support the development of local economies and the most important is the role of inter document playing in economic governance. The unpredictability of the political and unstable economic climate for foreign investors in emerging market poses a significant challenge.

Legal and institution issue

The legal and institutional environment reflects the overall attitude of a host country towards foreign investment. For a long time the legal and institutional environment are poorly developed in emerging market. In particular, in term of competition policy, regulatory policy, corporate taxation, and definition and enforcement of property rights.( Klaus E. Meyer, Saul Estrin) Moreover, even where the necessary law are in place, their implementation and enforcement is weak due to unqualified accountants, bureaucrats and lawyers. The legal framework is often subject to frequent changes, which creates considerable uncertainty for businesses.

The labor standards in MNE affiliates and subcontractors in emerging economies

are a major concern in globalization debates. Some observers fear that the strong

bargaining power of multinational firms vis-à-vis their employees, and vis-à-vis potential

host countries leads to a lowering of standards and wages (Cerny, 1994; Palley, 2002).

Does the downward spiral of rivalry lower labor standards in MNE operations in

developing countries, triggering a "race to the bottom" (Spar and Yoffie, 1999)?

The theoretical arguments concerning impact on social variables resemble those on

environmental impact. On the one hand, concern with global standardization and the firm's

reputation induces many MNE affiliates to pay higher wages and to employ high labor

standards with respect to working hours, sick leave, child labor, unionization etc. (Caves,

1996: 228; Moran, 2002). Since MNE's generally wish to retain their qualified staff, they

have incentives to keep them satisfied, unless they are employing unskilled labor with few

outside job opportunities. On the other hand, lower labor standards and lower wages

present opportunities to reduce production costs. This incentive is generally larger than for


environmental issues, as labor costs often account for a larger share of production costs.

Host countries eager to attract investment are said to compromise their standards under

pressure from MNEs, thus undermining democratic principles (Cerny, 1994; Scherer and

Smid 2000).4

The unease about the "race to the bottom" is of concern in certain industries, such

as textiles, footwear and assembly of electronics. Spar and Yoffie (1999:565) argue that

necessary conditions for a race to the bottom are first mobility of firms and goods across

borders, i.e. free trade, and, second, that "regulation and factor costs are heterogeneous -

and the heterogeneity leaves gaps that can be turned into the firm's competitive

advantage". Moreover lowering of standards is facilitated by

• Homogeneity of products (or components at certain stages of the value chain), such

that price is a key competitive parameter.

• Regulatory differentials are important for the cost structure of the industry, such as

labor law for textiles and footwear.

• MNEs would not incur major transaction costs or sunk costs when relocating a

production plant, i.e. location is not sticky.

Such a race to the bottom would not necessarily be in the business interest.

Infrastructure issue

Generally speaking, most emerging markets lag behind the advanced nation in terms of communication, distribution, and management perceptions. Any one of those factors may threaten the success of international firms. Respecting the communication, in many transition economies are not well functioning as they are in the western part of the world. As one British businessman who had personally been successful in doing business in China commented, 'You can hardly find any yellow pages in China.' The personal contact seems as an effective strategy in Chinese market. As Guo and Akroyd argue that the Chinese communication system is technically oriented rather than commercially oriented. In addition, As far as the distribution sector concerned, it is practically poor, even non-existent in smaller town and countryside. Foreign firms have to set up their own distribution system, supply centres and warehouse. This might force the companies to settle in large cities. For this reason, the market for many western goods is also much closer to saturation there than in the countryside, or in the smaller towns. Furthermore, numbers of infrastructural barriers are also identified including: the difficulties of sourcing raw materials, lack of personnel training, as well as problems with the operation and maintenance of transferred technology. In short the poorly developed infrastructure will enlarge investor's transaction cost.

Institutions failing to ensure efficient functioning of markets are widespread in emerging

economies. Formal institutions such as the legal code may be less sophisticated, and, just

as important, law enforcement may be inefficient. Local firms may thus rely on network

based coordination mechanisms to overcome various forms of market failure (Peng 2000).

Yet how does this institutional heterogeneity interact with FDI? On the one hand, foreign

investors may influence the institutional development, but at the same time they adjust to

local institutions. Moreover, institutions moderate interactions with local firms and


The literature has analyzed the issues largely separate: strategy scholars analyze

how FDI strategies are adjusted to local contexts, and institutions in particular (Peng,

2000; Henisz, 2000; Meyer, 2001), while development scholars analyze how FDI

influences the local context. However, FDI strategies and the local environment in

emerging economies are mutually interdependent. Informal institutions may be influenced

by the living example of businesses based on different values and norms, and even formal

institutions may be influenced by governments changing legislation in view of attracting

FDI, possibly even under direct negotiations or lobbying by MNEs. On the other hand, the

local environment, in particular the institutional framework, influences MNEs' entry and

subsidiary strategies.


Moreover, institutions moderate many of the afore discussed relationships between

foreign and local firms, for instance:

• Labor market institutions moderate the mobility of people between local and FDI

firms, and thus the diffusion of knowledge, but also local firms' loss of employees to

foreign competitors. Labor laws and their enforcement regulate minimum wages and

working conditions.

• Capital market institutions moderate the ease of local sourcing of capital, but also the

possible crowding out of local investment.

• Environmental regulation and enforcement influence the potential negative effects on

the local environment.

• Competition and industry regulation influence foreign investors ability to extract

monopoly rents or otherwise benefit from market power.

• Education systems enhance the availability of skilled labor and the absorptive capacity.

• Special economic zones may attract more FDI, but at the same time limit the

interaction with indigenous industry and thus spillovers.

Corporate strategies, institutional change and the development of local resources

and capabilities are thus mutually interdependent. This suggests two directions for future

research. Firstly, institutions are important moderating variables to be included in many

studies of FDI impact. Secondly, scholars should build on recent research on the coevolution

of corporate strategies and institutions (Lewin and Kim, 2003) and apply this

line of thought to emerging economies (Meyer and Nguyen, 2003). This should lead to

clearer empirical evidence on long run processes of institutional and corporate change.

Social issue

The wide gap between rich and poor in emerging markets is a principal cause of social tension. Other social issues include ethnic tensions, such as those that have exploded disastrously in Central Europe. Also in accordance with Helms, in former socialist countries, the socialist legacy is other obstacles leading to the foreign invest flow in. As he argued that owning to the state controlled industries in the past, the alcoholism and absenteeism has been high, which have affected the work habits of today. Further he claimed that handling workers with this attitude can be very difficult.

It is not only the culture and language problems, also the awareness of society setting the barriers for investor.

For small ambitious firms in emerging economies, access to such production

networks is of increasing importance, yet the long term-nature of supplier relationships and

the global reach of incumbents raise entry barriers. Incumbents benefit from their longstanding

relationship, their reputation and their customer-specific know-how. Also, large

firms are better able to guarantee quality and just-in-time delivery. Thus attaining access to

an international value chain is a major challenge for small firms in emerging economies.

This key role of clusters for economic development, and the potentially central role

of MNEs in clusters, raises many research questions. First, how convincing is the

empirical evidence for spillovers to occur at sub-national level? On aggregate level, it is

not very strong. Aitken and Harrison (1999) and Smarzynska (2002) test for the spillovers

pertaining to a "local" region smaller than the host economy, but they find no evidence to

support this claim in respectively Venezuela and Lithuania. However, Zhang (2001) finds

positive evidence of spillovers at regional level within China, as does Sjöholm (1999b) in

Indonesia. More favorable evidence comes from case research, showing how FDI can

facilitate cluster development. For instance, Patibandla and Petersen (2002) argue that the

early investment by Texas Instruments in Bangalore was instrumental in developing the

Indian software cluster. Similar case evidence shows contributions of FDI during the

inception phase of industrial clusters, such as the textile industry in Bangla Desh and

Mauritius (Rhee and Belot, 1990), and the electronics industry in Penang, Malaysia

(Altenburg, 2000). Yet are these typical? Under which conditions do they emerge? To

assess the questions beyond the case study approach, future research needs better ways to

delineate clusters to capture intra-cluster spillover effects.

Secondly, how do MNEs contribute to cluster evolution? The contribution of the

foreign investor may lie in both transfer of knowledge to local partners, possibly in

exchange for other knowledge, and in their role as intermediaries in the international crossfertilization

of knowledge clusters. By establishing operations within a cluster, MNEs can

both contribute to and benefit from the knowledge exchange within the cluster.

Longitudinal case studies have followed global industry evolution over several

years or even decades to observe both winners and losers, tracing the emergence of new

clusters in a dynamic context and recording not only entries, but also exits (McKendrick,

Doner and Haggard, 2001; Murtha, Lenway and Hart, 2001). Research on industrial

clusters needs more such longitudinal studies. This qualitative research may then stimulate

theoretical development applying for instance theories of organizational learning,

knowledge creation and evolutionary economics, as well as focused empirical tests.


All in all, it is widely believed that Foreign Direct Investment made a major contribution to the economic development of emerging markets. Meanwhile; emerging markets play a vital role in the global strategies of many multinational enterprises (MNEs), notably those with ambitious growth targets. However, due to the political and economic uncertain, poorly developed the legal and institution framework and the lack of market information and communication system and so on. Such factors posed significant challenges and threaten for investors in accessing the emerging market. Therefore, in order to reduce the risk and transaction cost, the several entering model have been provided. Each model has their own characteristics, choosing the proper one can certainly eliminate the risks and reduce the transaction cost. Of these, joint venture is preferred entry model despite the apparent disadvantages of shared control JV offers the opportunity to establish a business operation in a foreign country when establishment of a Greenfield site is not feasible or too expensive. (Buckley and Casson 1976, 1998, Hennart 1988, 2001). Moreover it provides the foreign company with a local partner, which helps the investors easily access to local market. That especially benefit for pioneering without much local knowledge. However, by sharing control with local partner can lead to coordination conflicts, especially if their objectives are not compatible or cultural barriers inhibit communication. A Greenfield site gives the opportunity to create an entirely new operation but it is most risky entry model since the regulatory framework in transition countries is complex. An acquisition facilitates quick entry and immediate access to local resources. Acquisitions internalize certain markets, and bring together complementary resources, but these resources need to be integrated effectively (e.g. Haspeslagh and Jemison 1991). It is suitable entry strategy if acquired companies function in a westernized manner, and have local knowledge and contacts. A Brownfield, as a hybrid mode of entry, can substitute for either acquisition or Greenfield if they are not feasible or too costly. (Klaus Meyer, 2003) Brownfield projects can utilize more sources of resources enabling projects that neither the foreign investor nor the local firm could implement themselves. Through the Brownfield foreign investors can overcome obstacles arising from the limited availability of certain assets or from high transaction costs in specific markets by considering a wider choice of potential target firms. However, Brownfield typically incur high integration costs because the investor engages in deep restructuring and in major resource transfer.