The entry modes for Norco in the Chinese market for launching the Nimbin cheese should be base on the proper knowledge about the Chinese market, as the business strategy of Norco should be effective and competitive so that the effect of competitors in the target country can be minimized. Therefore, for this purpose, it is essential that the Norco should work on the entry mode.
Export entry mode compared with other entry modes such as FDI, licensing, franchising, distributorship, International Joint Ventures, has various advantages that include capital investment. It would enable the company to achieve regional advantages and economies of scale advantages. Exporting provides high degree of flexibility, irrespective of the host country regulations, due to minimal (Anderson, 2006, 7-23). Meanwhile, the export entry mode also has the following shortcomings and deficiencies that include tariff and non-tariff barriers could lead to loss of export products and the competitive advantage of local products; high transport costs; products reach the local market too long; difficult to maintain the inspection of local agents and local needs of the producer (Abell, 2008, 45-58).
Export entry mode is an enterprise product that is Nimbin cheese of Norco, in the domestic production, and then sold to international business strategy through the appropriate channels the way. This is a traditional way enterprise like Norco enters in the international markets that are Chinese market; this concept is now taken to enter the international market (Achrol and Kotler, 2007, 46-63). Export entry mode commonly divided into two types that are indirect export and direct export.
Export entry mode compared with other entry modes provides following advantages:
- Capital investment
- Can help companies realize the advantage and economies of scale advantages
- Is an effective way to obtain export experience
- A high degree of flexibility
The export entry mode will be helpful for the organization to follow as it will assist the Norco in making the cost effective decisions which will be valuable in the international business strategy.
Typically, shipping through ocean from Australia to the China takes approximately 3 to 4 weeks. Estimates of Nimbin cheese freight shipping costs for ocean are mentioned below. These costs are to be used as estimates for the Nimbin cheese. Sea cargo is the most optimal solution for the export of cheese from Australia to Chinese ports. These rates have been taken from the quote of Maersk liner.