Earth-Rite Organic Foods
Earth-Rite Organic Foods is an MNE based in Sweden with subsidiaries located in numerous countries around the world. Earth-Rite has annual sales of $40 billion dollars and employs more than 90,000 individuals worldwide. Earth-Rite currently dominates the organic food industry, but competitors are beginning to catch up because of a growing demand for organic food. Earth-Rite is considering a "collaborative venture" with a small chain of organic grocery stores located in Brazil, a country where Earth-Rite has no stores.
-Which of the following would be a benefit for Earth-Rite if the MNE entered into a joint venture with the Brazilian grocery store chain?

Question

Earth-Rite Organic Foods 
Earth-Rite Organic Foods is an MNE based in Sweden with subsidiaries located in numerous countries around the world. Earth-Rite has annual sales of $40 billion dollars and employs more than 90,000 individuals worldwide. Earth-Rite currently dominates the organic food industry, but competitors are beginning to catch up because of a growing demand for organic food. Earth-Rite is considering a "collaborative venture" with a small chain of organic grocery stores located in Brazil, a country where Earth-Rite has no stores.
-Which of the following would be a benefit for Earth-Rite if the MNE entered into a joint venture with the Brazilian grocery store chain?

Quizplus · Accepted Answer

Entering a joint venture with a local company, such as the Brazilian grocery store chain, would provide Earth-Rite with local knowledge and established networks, making it easier to navigate through the foreign country's distribution channels.