Lite Foods is a producer of breakfast cereals such as oatmeal and cornflakes, and its products can be found in nearly all supermarkets across Canada. Lite Foods now has its sights set on international shores, specifically the large Chinese consumer market. Company executives are currently debating the optimal route for the firm to enter the market. Which of the following, if true, would weaken the argument for exporting the company's products to China?
A) Lite Foods will have to make significant investments if it decides to enter a joint venture in China.
B) Lite Foods would have to hire sales personnel from the host country if it opts for direct export.
C) Lite Foods is a risk-averse organization.
D) Lite Foods lacks Chinese market expertise and has not found reliable intermediaries with expertise in the market.
E) Lite Foods will export its products as is, as more and more Chinese consumers are adopting breakfast cereals.

Question

Quizplus · Accepted Answer

The option D weakens the argument as Lite Foods lacks Chinese market expertise and has not found reliable intermediaries with expertise in the market, which can create difficulties in penetrating the market successfully. Option A is not relevant here as the question is asking for something that can weaken the argument for exporting products to China, and investment requirement does not necessarily imply the argument it, in fact, can be considered as a strength of exporting. Option B is also not relevant here as it is discussing direct export, which is one of the options for entering the Chinese market, and not weakening the argument. Option C is also not relevant as it just provides information about the company's risk aversion approach and not weakening the argument. Option E also does not weaken the argument as the significance of exporting products as is to Chinese consumers is not established here, so it cannot be concluded as weakening the argument for exporting.

Lite Foods Is a Producer of Breakfast Cereals Such as Oatmeal