Question

Provide two recent examples of market entry strategies of other multinational companies who have entered Mexico and have failed or succeeded.

a) What are the most interesting facts or fun facts about Mexico?

b) What are the key challenges, risk, and threats of doing business in Mexico

Answer 1

Answer;

Two of the Companies succeeded in Mexico are "Neslte" and "Ford"

Their market strategies are;

Neslte: Positioning Strategy, product differentiation, and channel differentiation

Answer;

a. Interesting facts and fun facts about Mexico.

1. The Official name of Mexico is united Mexican States.

2. Mexico is the 11th most populated country in the world.

3. Mexico is the 14th largest country in land area.

4. Mexico city is considered to be the most traffic-congested city in the entire word.

5. Mexico City sinks between 0.2 and 1.3 feet each year. The country is slowly sinking to ocean, due to over extraction of ground water throughout the country.

6. Mexico has trade agreement with 40 countries, including the United States and countries in the European Union.

7. Mexico imports 48% of its goods from the United states and is a part of the American Free Trade Agreement.

8. Mexico's main export include manufactured goods, oil, silver and food products. Main product include agricultural machinery, car parts, aircraft parts and eletrical equipment.

9. Mexico is the most populous Spanish speaking country in the world.

10. A 95 mile long underground beneath Mexico. The river flows through limestone caves and crevices that are below the Yucatan Peninsula.

b. Key challenges, risks and threats of doing business in Mexico.

Starting a business in mexico was once a complex minefield, but thanks to tough government action the procedure today is much more manageable. Mexico ranks 49 overall in the World Bank's doing business evaluation, and 90 for ease of starting a business. Still there are many challenges and risks in there of doing a business.

i. Dealing with construction permits: It takes around 76 days to deal eith construcion permits, which is by far more efficient than the Latin American and Caribean average. Water and sewerage connection takes the most tie to complete and obtaining a single zoning certificate stating specific land use and feasibility can be a complex task.

ii. Getting electricity: According to the World Bank Mexico ranks 92 in the world for ease of getting electricity, underlining the complex nature of the procedure. It is task laden with bureaucracy, and firms must submit applications, obtain certificates and inspections from the Commision Federal de Electricidad (CFE), before a contractor can carry out the works.

iii. Registering Property: Registering property is a long and arduous task, it can take almost double the time compared to the norm for OECD countries. Dealing wth the Public Registering of Property of the Federal District can be particularly time cosuming, and obtaining a certificate of good standing with the water service and the Zoing certificate of the property can also take some time.

iv. Getting Credit: Mexico's well developed financial sector puts it in good stead in terms of getting credit, although it is relatively difficult compared to most developed nations in the world.

v. Protecting Investors: Investor protection is still a contentious issue in Mexico, although the North American Free Trade Agreement has gone a long way in rectifying some of the past issues that existed in the country.

vi. Trading Across Borders: There is a substancial cost associated with trading across borders, far higher than the average in South America and the Caribbean. The cost of importing is around $450 per container and exporting costs $400. It also takes quite a long time to move containers, 12 days when importing and exporting on average.