Question

Company X is an American manufacturing company getting ready to start selling its products in Mexico. You are the manager of a team tasked with assessing the potential risks to the company as it gets ready to expand to another country.

Create a 8- to 10-slide Microsoft^® PowerPoint^® presentation you will deliver to the Board of Directors discussing the risks the company could face.

Address the following points in your presentation:

Explain what risks the company could face in entering the market in Mexico.

Explain how these risks might be different than those risks faced in staying in just the American market.

Analyze how the company can manage these risks.

Include detailed speaker note for each slide except the title and reference slides.

Answer 1

one of the main advantage of entering into the market in Mexico is the low labour cost, but it involves various risks as well. bit there are various hidden costs. for e.g. Mexico has poor infrastructure facilities. like due to dearth of capital, housing facilites are not at par for the factory owners. Another cost is the training cost, which is higher in mexico as compared to US. Due to trade agreements, Mexican market is highly dependent on US, owing to changes in the NAFTA agreement. Neverthless, Mexico has wider opportunity to modernise its economy than US and the climatic regulations are much more easier than those in US. however, with the recent changes in Mexican labour law and anti corrpution law, the challenges of entering into the mexican market has increased. higher turnoer ratio can also add to the potential risk of entering into the mexican market. However, in cse of American market, there can be risk of clmate regulation hurdle. but the large pool of capital and better infrastructure facilities eaes the risks. however, in Mexico these risk can be curtailed by opeing a factory near the home place of workers so that they can easily commute daily. also paying them a good salary will help to reduce the turnover raio. and providing better training facilities will enhance the productivity of workers, further reducing the cost pf labur and increasing their efficiency.