Harley

Advantages of forming a Joint Venture:

* Provide Harley Davidson with the opportunity to gain new capacity and new geographical markets.

* Sharing of risks with a venture partner.

* Joint ventures can be flexible, which means we can negotiate terms with the venture partner.

* Harley Davidson can gradually separate a business from the rest of the organization, and eventually, sell it to the other parent company.

Disadvantages of forming a Joint Venture:

* It takes time and effort to build the right relationship and partnering with another business can be challenging.

* There is an imbalance in levels of expertise.

* Different cultures and management styles result in poor integration and co-operation.

* Success in a joint venture depends on thorough research and analysis of the objectives.

Advantages of exports:

* It is a relatively low-cost activity to get involved in international business and expand profit.

* Harley Davidson can further create economies of scale which should lead to lower cost and hence expansion of profit.

Disadvantages of exports:

* In relation to location economies, Harley Davidson may not always be located in the best region for that specific area.

* Harley Davidson is further depended on the fluctuation of transportation costs.

* Related to point B will likely involve government regulations, such as tariffs and quotas or other hidden barriers.

* Lastly, an exporting Harley Davidson will have to work with an agent which is not necessarily loyal to one brand.

Advantages of wholly owned subsidiaries

Harley Davidson has no risk of losing technical competence to a competitor.

Harley Davidson gets full control of operations.

Harley can realize learning curve and location economies.

Disadvantages of wholly owned subsidiaries

Bear full cost and risk.

The complications that the Chinese business environment poses are as follows:

1. Political environment

- major concern :...