McDonald’s Corporation (McDonald’s) – www.mcdonalds.com – is the world’s largest food service retailing chain. The company is known for its burgers and fries, which it sells through 32,000 fast-food restaurants in over 120 countries. Franchisees operated 81 per cent of the restaurants at year-end 2009. McDonald’s is headquartered in Oak Brook, Illinois, and employs approximately 400,000 people. The company recorded revenues of $22,745 million during the fiscal year ended December 2009. The net income was $4310 million. The history of McDonald’s dates back to a hamburger stand in California, owned by two brothers Dick and Mac McDonald. Ray Kroc, a distributor of milk shake mixers, impressed by the operation of the McDonald brothers, persuaded them to allow him to open a similar restaurant in Des Plaines, Illinois. The first McDonald’s restaurant was established in Des Plaines, Illinois in 1955. Soon the number of McDonald’s restaurants increased to 100 by 1959 and 500 by 1963. Under the franchise arrangement, the franchisees invest in the equipment, indoor- and outdoor signs, seating and decoration, while the mother company owns or leases the land and building. Franchisees pay the company service fees and rent for premises. Service fees are set as a percentage of sales, while rent and other terms of occupancy are stipulated in the franchise agreement, which is drawn for a period of 20 years. The video case is about the challenges, which McDonald’s may face in consolidating revenues and other financial information from operations in multiple countries. It is also about recognizing how differing laws and monetary systems can affect the accounting activities of a global corporation. Collecting, analysing and reporting financial data from all the restaurants in 120 countries is no easy task, as the accounting experts at McDonald’s are well aware. Every month, the individual restaurants send their sales figures to be consolidated with data from other restaurants at the local or country level. From there, the figures are sent to country-group offices and then to one of three major regional offices before going to their final destination at the McDonald’s headquarters in Oak Brook, Illinois. In the past, financial information arrived in Illinois in bits and pieces, sent by courier, mail or fax. Today, local and regional offices log onto a special secure website and enter their month-end figures, enabling the corporate controller to quickly produce financial statements and projections for internal and external use. 1. What could be the reason why McDonald’s have both franchised and own restaurants? 2. Which financial measures should McDonald’s use to control the global marketing programme in the single countries and in single restaurants? 3. What problems might arise if individual McDonald’s restaurants were required to enter sales data directly on the company’s centralized accounting website at the HQ in USA, instead of following the current procedure of sending it through country (subsidiaries) and through other regional channels?
> What are the key problems associated with profit repatriation from subsidiaries?
> Why is acquisition often the preferred way to establish wholly owned operations abroad? What are the limitations of acquisition as an entry method?
> What is the idea behind appointing a ‘lead country’ in a region?
> Is the establishment of wholly owned subsidiaries abroad an appropriate international market development mode for SMEs?
> What are a firm’s major motives in the decision to establish manufacturing facilities in a foreign country?
> By what criteria would you judge a particular foreign direct investment activity to have succeeded or failed?
> Why would a firm consider forming partnerships with competitors?
> Do you believe that licensing in represents a feasible long-term product development strategy for a company? Discuss in relation to in-house product development.
> What is meant by ‘change agents’ in global marketing? Give examples of different types of change agent.
> Why are strategic alliances used in new product development?
> Why are joint ventures preferred by host countries as an entry strategy for foreign firms?
> When a firm begins direct exporting, what tasks must it perform?
> How can the carrier and the rider both benefit from a piggyback arrangement?
> What is the difference between direct and indirect exporting?
> The international marketer and the intermediary will have different expectations concerning the relationship. Why should these expectations be spelled out and clarified in the contract?
> ‘When exporting to a market, you’re only as good as your intermediary there’. Discuss.
> Discuss the various ways of communicating with foreign distributors.
> Why is exporting frequently considered the simplest way of entering foreign markets and thus favoured by SMEs?
> Do you agree with the view that LSEs use a rational analytic approach (strategy rule) to the entry mode decision, while SMEs use a more pragmatic/opportunistic approach?
> What are the main differences between global marketing and marketing in the domestic context?
> Why is choosing the most appropriate market entry and development strategy one of the most difficult decisions for the international marketer?
> Discuss the advantages and disadvantages of using only secondary data as screening criteria in the IMS process.
> Explore the factors which influence the international market selection process.
> Compare the role of women in your country to their role in other cultures. How do the different roles affect women’s behaviour as consumers and as business people?
> What role does the self-reference criterion play in international business ethics?
> The focus of this chapter has mainly been the influence of culture on international marketing strategies. Try also to discuss the potential influences of marketing on cultures.
> I. Synopsis In this case, the core problem for Polaroid sunglasses is to convert a high degree of brand awareness into a successful international sales expansion in the premium sunglass segment. Of the total market of 300 million pairs of sunglasses, th
> I. Synopsis Tetra Pak is a leading manufacturer and supplier of carton packaging for milk, fruit juice and drinks. The company primarily operates in Europe, Asia and the United States. Tetra Pak delivers packaging products and solutions in more than 170
> I. Synopsis The energy drink, Red Bull, has become extremely popular over the recent years with almost one billion 250 ml cans sold in 2000 to more than four billion cans sold in 2010 in over 130 countries. In 2010, Red Bull generated over â‚
> I. Synopsis In August 2008, the international media and entertainment companies Sony Corporation and Bertelsmann AG announced, that Sony has agreed to acquire Bertelsmann’s 50 per cent stake in Sony BMG. The new music company, to be called Sony Music En
> 1. Describe the business and distribution model that Stella & Dot build on. 2. What are the opportunities and challenges in globalizing the Stella & Dot’s business model? 3. When Stella & Dot globalize their business – how should they incorporate all the
> 1. What could be the reason why Müller is using distributors (export mode) in markets outside Germany? 2. What would be the main reasons why Müller is using a joint venture solution (intermediate mode) with PepsiCo (Quaker) for the US market?
> 1. Which demand factors would influence future sales of business jets in general? 2. How could Honda Aircraft Company estimate the future total market for these small sized business jets (total number of sold small business jets per year)? 3. Which scree
> What layers of culture have the strongest influence on business people’s behaviour?
> 1. What are the basic principles in the ‘sharing economy’? 2. Explain the competitive advantage of Uber. 3. Why is it so important for Uber to get into so many countries so fast?
> 1. Why is a product placement often more effective than a television commercial? 2. What is the target group and the main ‘message’ in the Tequila Avión commercial? 3. Why is it a good idea to let over the worldwide distribution of Tequila Avión to Perno
> I. Synopsis The credit for Triumph’s rebirth goes to John Bloor, a builder who bought the company’s remains (the Triumph brand name and the company’s designs and tooling) for about $200,000. He has invested £80 million on, among other things, a new plan
> I. Synopsis One of the most significant developments in the vacuum cleaner market in recent years was that of bagless technology. James Dyson introduced the first bagless vacuum cleaner in Japan, sold under the G Force name. Dyson of the United Kingdom p
> I. Synopsis The UK-based company Diageo was formed through the merger of Guinness and Grand Met in 1997. Since July 2000, the company has increasingly concentrated its focus on its premium drinks business, spinning off food operations such as Pillsbury C
> I. Synopsis Absolut Spirits Company is the international wing of the state owned Vin & Sprit AB (V&S) in Sweden. The first bottles of Absolut Vodka were first sold in USA in 1979. Since then Absolut Vodka has reached a market share of about 10 per cent
> I. Synopsis IMAX Corporation is involved in out-of-home entertainment business activities. IMAX Corporation designs and manufactures projection and sound systems for giant-screen theatres based on a patented technology. The company does not own the IMAX
> I. Synopsis Autoliv is a systems supplier and the development partner to the car producers that satisfy all the needs in the area of personal safety. The company has two product lines: seat belts and air bags. The American company TRW is the biggest supp
> I. Synopsis Netflix is one of the world’s largest internet subscription services for movies and TV shows. Subscribers can instantly watch content streamed to their TVs, computers and mobile devices and receive DVDs delivered to their homes as well. The
> I. Synopsis The name Raleigh (www.raleigh.co.uk) has been synonymous with bikes since the company was founded in a small workshop on Raleigh Street by three men, in 1886. Raleigh sold its Triumph road site to the University of Nottingham in 2000 in a sa
> As English is the world language of business, is it necessary for UK managers to learn a foreign language?
> I. Synopsis Ferrari is among the world’s leading luxury brands focused on the design, engineering, production and sale of the world’s most recognizable luxury performance sports cars. The brand symbolizes luxury, exclusivity, innovation, state-of-the-art
> I. Synopsis Zalando is an online provider of shoes and fashion items. The company offers a variety of products for women, men and children with over 1,500 international brands. It also provides a combination of services including delivery and returns, a
> I. Synopsis The female condom was invented by a Danish physician who obtained a US patent for the product in 1988. The physician subsequently sold certain rights to the female condom to an American company. The first female condom became available in 199
> I. Synopsis SodaStream International Ltd is the leading manufacturer and distributor of home soda maker systems, with products available in 60,000 stores in 45 countries. The firm offers carbonation machines, as well as a line of beverage mixers and syru
> 1. Was it a good idea to shift the Henkel organization from a more product to a more customer-centric approach? 2. What are the challenges of being a customer-driven multinational that serves both B2B and B2C customers? 3. How can Henkel further intensif
> 1. Discuss the two views of organizing Mars’ European activities. 2. Did Mars Inc. do the right thing in your opinion?
> Dunkin’ Brands – www.dunkinbrands.com runs – a chain of quick service restaurant companies. The company is split into three business segments: Dunkin’ Donuts, Baskin- Robbins and Togo’s. Retail outlets are operated in a franchise format either through op
> 1. What cultural barriers would the Japanese managers from Toto meet when negotiating with American managers from building societies about new contracts for toilets in US luxury apartments? 2. Some analysts argue that tackling cultural toilet norms and b
> 1. What are the main reasons for the success of ZamZam Cola in Middle East? 2. How should Ahmad-Haddad Moghaddam prepare his sales force ‘culturally’ for selling ZamZam Cola to European supermarket chains? 3. Do you think Ahmad-Haddad Moghaddam can repea
> Why is political stability so important for international marketers? Find some recent examples from the press to underline your points.
> Until now Jarlsberg’s different agents and partners in the different countries have been responsible for the local ads. Please take a look at the different ads. 1. Explain the different cultural characteristics behind the different ads. 2. Would it be a
> Bayerische Motoren Werke (BMW) – www.bmw.com – is one of the leading manufacturers of premium passenger cars and motorcycles in Europe. It also offers insurance, reinsurance and information technology consulting services. The company primarily operates i
> 1. How is Morgan’s international communication strategy different from mainstream mass-produced cars? 2. How can Morgan use celebrities in the communication strategy? 3. How can Morgan make use of social media? 4. Prepare a global communication plan for
> The Norwegian producer of functionalistic clothes, Helly Hansen (HH), has for generations been connected with wind and waterproof leisure wear, and work clothes for the quality conscious consumer. Now the company (by chance) has become the supplier of st
> DHL International (www.dhl.com) specializes in cross-border express deliveries. DHL is the global market leader in international express, overland transport and airfreight. It is also the world’s number 1 in ocean freight and contract logistics. DHL offe
> 1. How will you characterize Tupperware’s distribution strategy in relation to the theoretical models? 2. What are the advantages and disadvantages of Tupperware’s distribution model? 3. How do you evaluate the future for this distribution model 4. In th
> 1. What could be De Beers’ motives for making this ‘forward integration’ into the retail and consumer market? 2. Is it a wise decision? 3. How should De Beers develop its internet strategy following this ‘forward integration’ strategy? 4. Would it be pos
> 1. If you were a representative of the Vaseline (Unilever) management, how would you justify the price difference? What extra customer value do you create by selling the jelly as Lip Therapy in small tubes? 2. How would you price the Vaseline Intensive c
> Headquartered in Boston, Massachusetts, the Gillette Company (www.gillette.com) is the world leader in male grooming products, including blades, razors and shaving preparations. Gillette also holds the number one position worldwide in selected female gro
> 1. Describe HD’s general pricing strategy. What does the company’s positioning have to do with its pricing strategy? 2. Should HD alter its price, given strong price pressures from rivals? 3. What should HD do to improve its market share in Europe?
> Why are international marketers interested in the age distribution of the population in a market?
> How can an SME compensate for its lack of resources and expertise in global marketing when trying to enter export markets?
> Burberry has positioned its brand in the minds of consumers to be ‘functional luxury’. Burberry maintains a product line with great width and depth consisting of many products. Their products fall into one of the two main categories: fashion or continuit
> 1. What are the pros and cons of the product diversification strategy that Zippo has been following recently? 2. In a US marketing campaign in the late 1990s Zippo was repositioned as an essential tool for avid outdoorsmen. Individual tin and sleeve pa
> 1. What might have been the reasons that Danish Klassic was not able to meet expectations? Comment on the following: (a) the change of packaging – from glass to plastic brick carton (b) the consumer-oriented advertisement (photo a) – is it targeted at th
> 1. Try to describe the complex decision-making process regarding choice of supplier for installation of new elevators and escalators in a building. 2. What are Kone’s key challenges in establishing long-term relationships with its new global customers?
> 1. As a supplier of the Indego, how should Bosch’s approaches differ in the two types of distribution in Figure 2? Figure 2 looks like this: Figure 2: Two different distribution systems for the Bosch Indego 2. Which of the two distribu
> 1. Explain the role of ARM as a supplier in the ‘chip’ value chain. 2. What are the strengths and the weaknesses of ARM’s business model compared with Intel? 3. In which end-user application market should ARM strengthen its relationships to potential par
> Starbucks Corporation (www.starbucks.com) is named after the first mate in Herman Melville’s Moby Dick. It was founded in 1971 in Seattle. The original name of the company was Starbucks Coffee, Tea and Spices, later changed to Starbucks Coffee Company.
> Until now, SSL has sold their Durex condoms through Okamoto, the largest supplier of condoms in Japan. Overall SSL’s condom brand, Durex, is the world market leader in condoms. 1. What were the main motives for SSL establishing its own distribution chann
> 1. What are the likely main motives for Polo Ralph Lauren to shift the entry mode from licensing to hierarchical mode in South-east Asia? 2. Would you recommend them to take all geographical licenses back in-house, and turn them into hierarchical modes?
> Marriott is a diversified service and hospitality company with operations in five business segments: - Full-Service, which includes following brands: Marriott Hotels & Resorts, The Ritz- Carlton, Renaissance Hotels & Resorts and Bulgari Hotels & Resorts
> Discuss the limitations of per-capita income in evaluating market potential.
> In 1993, the Danish textile firm, Kabooki, was given the rights to use the LEGO brand (licensing-in) in connection with production and sales of children’s clothes. LEGO children’s clothes have the following features: functional, clear and strong colours,
> 1. Do you think that Hello Kitty will continue to rule the world? What are the pros and cons? 2. What are the reasons that Hello Kitty is licensed to so many different product manufacturers? 3. Suggest the future licensing strategy for Hello Kitty.
> Honest Tea is a tea company based in Maryland, USA. Honest Tea was founded in 1998 by Seth Goldman (now President and CEO, or as he calls it, ‘Tea-EO’) and Barry Nalebuff, to sell ‘bottled iced tea that tastes like tea’; a less-sweetened alternative to s
> 1. Which region of the world would you recommend Parle Products to penetrate as its first choice? 2. What kind of export mode would be most relevant for Parle Products? 3. How could Parle Products conduct a systematic screening of potential distributors
> 1. What are the main advantages and disadvantages for Arcus of using export modes, compared to other entry modes, for its Linie Aquavit? 2. What should be Arcus’ main criteria for selecting new distributors or cooperation partners for Linie Aquavit in ne
> Understanding entry modes into the Chinese market China became a member of the WTO on 11 December 2001, and is currently in the process of completing a seven-year transitional period. Overall, the Chinese economy has shown exceptional economic growth ov
> 1. What are the differences between the global strategies of Ansell and the other three competitors? 2. Which entry mode would you recommend for Ansell’s sourcing (purchasing or production) of condoms? 3. What are the pros and cons for Ansell acquiring a
> 1. Which kind of market entry mode would you generally suggest for Jarlsberg: (a) in Scandinavia? (b) in Asia? 2. What are the general motives for choosing a hierarchical mode (own subsidiary) in the United States?
> 1. What are the foundations of Oreo’s global success? 2. What demographic changes and cultural issues might influence the future global market for Oreo? 3. What are the most important screening criteria for Oreo (Mondelēz) in the IMS?
> 1. Discuss the appropriateness of the screening model used in this case. 2. Suggest another screening model that could be relevant for Philips Lighting to use in the Middle East.
> Explain the importance of a common European currency to firms selling goods to the European market.
> 1. What could be the main reasons for Tata Motors entering the global ultra-low-cost car market? 2. What are the competitive advantages that Tata Motors would enjoy with their Nano in emerging markets? 3. Which screening criteria would you suggest for Ta
> First of all, it should be mentioned that around 50 per cent of Allergan’s Botox sales is used for therapeutic purposes like migraine and depression. When we concentrate on the cosmetic purposes in general (and also include competitor products such as Dy
> The catalogue serves as a pre-shopping advertisement, an in-store sales aid and an interior decorating guide. Many consumers shop with the catalogue in hand. Since the catalogue is such an important marketing tool, it is crucial for it to accurately refl
> 1. Which sociocultural factors influence the sales of tickets for ‘Cirque du Soleil’ shows around the world? 2. What makes the business model of ‘Cirque du Soleil’ globally so successful? 3. What should be the criteria for selection of a theme for Cirque
> Although global business has been growing rapidly in recent decades and globalization seems inevitable, it is not without controversy, and the critics offer a few key arguments. 1. Some people lose while others gain, both in absolute and relative terms.
> 1. Which political and economic factors in the global environment would have the biggest effect on the future global sales of Danfoss Power Solutions’ hydraulic components/systems to: (a) manufacturers of construction and mining equipment (e.g. Caterpill
> The G20 was established in 1999, in the wake of the 1997 Asian Financial Crisis, to bring together major advanced and emerging economies to stabilize the global financial market. 1. What were the key arguments of the anti-globalization groups? 2. How cou
> 1. Which research market research method would you use to estimate the total world market for electric cars? 2. Which research market research method would you use to estimate the total world sales of BMW i3 electric cars?
> LEGO Friends – one of the world’s third largest toy manufacturer is moving into the girls’ domain www.lego.com 1. Emerging markets like China, India and Indonesia offer long-term opportunities for organic growth. However, LEGO still has a small share in
> Teepack Spezialmaschinen GmbH – organizing a global survey of customer satisfaction www.teepack.com 1. How would you forecast worldwide demand for tea bag machines? 2. How can Teepack and Teekanne use their relationship to each other with regard to colle
> Explain why a country’s balance of trade may be of interest to an international marketer.
