Laura's Lights, Inc. has decided to expand business into Vietnam. Laura is looking for help with funding the operation and to share in the risk. She knows little about the customs and how to get things done in Vietnam. The best international structure for her is probably a(n)
A) branch office.
B) direct investment.
C) strategic alliance.
D) licensing arrangement.
E) independent agent.

Question

Quizplus · Accepted Answer

A strategic alliance would be the best choice for Laura's Lights, Inc. as it would allow her to share the risk and costs with a local partner who has knowledge of the customs and how to get things done in Vietnam. This would also give Laura's Lights the opportunity to tap into the local partner's network and resources. A branch office, direct investment, or licensing arrangement may be too risky or expensive for a company that is still learning about the business environment in Vietnam, while an independent agent may not offer the necessary support and partnership.