| PROS | CONS |
|---|---|
| Under your control | High start up costs |
| Easier communications with HQ | Could be difficult to find good local people |
| Profit stays within the company | Could be costly and risky. |
| Will increase prestige in domestic and international markets | If not successful, can have long-term negative impact |
| More freedom for implementing ideas | Can demand a larger administrative organisation than if using local distributor |
| An independent legal entity separate from HQ | May have too narrow a range of products to be profitable |
| Better feedback from market | Foreign investment can be influenced by risks (Economical and Political) |
| For larger contracts, a definite advantage to own the operation |
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