A small Canadian firm that has developed valuable new medical products using its unique biotechnology know-how is trying to decide how best to serve the European Union market. Its choices are given below. The firm has set up a manufacturing plant outside Toronto where is it producing the product for the US and Canadian markets. If these following choices are the firm's only options, which one would you advise it to choose? Why?

A. Manufacture the products in Canada, and let foreign sales agents in various EU countries handle selling and marketing to the EU

B. Acquire an existing medical products manufacturer in Denmark. This company already has small plant and an effective sales organization. However, the cost of the acquisition is expensive and could be more than the Canadian firms current annual sales revenue.

C. Set up a turnkey manufacturing facility in France and turn over all manufacturing and selling responsibilities for the EU to whichever French company makes the highest bid. (The French Government suggested this option)

D. Enter into a joint venture alliance with a large German pharmaceutical firm. The products would be manufactured under license in Germany by the 50-50 joint venture and then sold and marketed by the German firm.

QUESTION:

Indicate which of a, b, c or d would be your recommendation. In your answer indicate the reasons for your selection and why you decided it is better than each of the other options?