When Nestlé actually owns a subsidiary or division in a foreign country, such as when it established its own ice cream manufacturing operation in China, this global market entry strategy is known as __________ and represents the greatest commitment a company can make to international sales.
A)licensing
B)local assembly
C)a joint venture
D)direct investment
E)local manufacturing

Question

Quizplus · Accepted Answer

Direct investment involves establishing a subsidiary or division in a foreign country, which is the case when Nestlé established its own ice cream manufacturing operation in China. This strategy represents the highest level of commitment a company can make to international sales because it involves significant investment and risk-taking. Licensing, local assembly, joint venture, and local manufacturing strategies do not involve the same level of ownership and control over operations in the foreign country.

When Nestlé Actually Owns a Subsidiary or Division in a Foreign