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Entrepreneurship, International Business, and M&A - Coggle Diagram

- - - - Bigger than national markets is naturally key.
  - - - Entry strategy could be joint venture to help bridge knowledge gap - such as in countries like China where regulations essentially require it.
      - Using a PESTEL analysis will allow for accurate interpretation of market conditions for new products, partnerships and expansion plans.
- - - - Analyse environmental trends and gaps to find opportunity.
        
        VRIO to identify resources to fill gap
        
        Locate resources
        
        Value chains to exploit
        
        Determine innovation to products or processes
        
        Market pull should determine changes and improvements ideally
        
        Leader users or frugal innovation will determine better product choices.
        
        2 more items...
        
        Can again use PESTEL
    - - Allows for innovation and profits to continue ideally at same time
- - - - • Combing of two separate companies to form a new one
      - • Similar size
      - • Equal status
  - - - • Takeover via share purchase
      - • Mostly friendly, shareholder recommended to accept takeover
      - • If hostile, shareholders will be appealed to by the acquirer to convince compliance
      - • Acquirer generally larger than target
  - - - • Improves competitive advantage
        
        • Extension to new markets, products, regions
        
        • Consolidate markets (increase size and power), reduce competition, increase efficiency
        
        • Capabilities increase with less expenditure – e.g. buy a startup that has the tech already
    - - • Optimal use of finances
        
        • Financial efficiency – improve acquired company books, more capital access, offset debts with shares from acquirer.
        
        • Tax efficiency – maybe lower tax or tax offsets.
        
        • Asset stripping – breaking down businesses and selling off when undervalued. Can be beneficial to all in some situations
    - - • Not often in shareholder interest, self-serving for the manger benefit.
        
        • Personal ambition – benefits due to short term incentives, boost reputation, help friends and family.
        
        • Bandwagon, trying to prove not cautious, fear of falling behind, fear of being acquired.
  - - - Non- equity
        
        Capital investment or fee paid.
        
        Franchises are common example
      - Equity
        
        Collective ownership of new entity
        
        Joint ventures
    - - (i) Scale activities – improve power to purchase raw materials, production and services, share risk due to less commitment of capital, better purchasing power.
        
        (ii) Access an alliance – essentially like joining a club, can be for accessing markets, resources, technology etc.
        
        (iii) Complementary alliances – allow for support and strengthening of the members by filling the gap the other has.
        
        (iv) Collusive alliances – form an alliance to increase power, essentially a cartel. Used to exploit consumers and suppliers. Illegal so often no paperwork.