Jimenez Proposal

JIMENEZ CONSULTING

Internalization

Jimenez Consulting has been tracking the progress of a fundamental shift that is occurring in the world economy. As we move progressively away from a world in which national economies are relatively isolated from each other by barriers to cross-border trade and investment, by distance, time zones, and language, and by national differences in government regulation, culture, business systems and toward a world in which national economies are merging into one huge interdependent global economic system. Commonly referred to as globalization, the trend toward a more integrated global economic system has been in the place for many years, and will continue in the future.

The expansion of ACdc Windows, Inc. globally will allow it to increase its profitability in ways not available to strictly domestic enterprises. Companies that operate internationally can (1) earn greater return from their distinctive competencies; (2) realize what we refer to as location economies by dispersing individual value creation activities to those locations where they can be performed most efficiently; and (3) ride down the experience curve ahead of competitors, thereby lowering the costs of value creation.

Distinctive competencies are defined as “unique strengths that allow a company to achieve superior efficiency, quality, innovation, or customer responsiveness”. Such strengths typically find their expression in product offerings that other companies find difficult to match or imitate.

Since global markets are larger than domestic markets, companies that serve a global market from a single location are likely to build up accumulated volume faster than companies that focus primarily on serving their home market or on serving multiple markets from multiple production locations.

Licensing

To reap the above profits in globalization economy, companies have to look for an appropriate mode of entering foreign market. There are several...