Question
I came up with an imaginary company called Clean Energy that you have been operating in the domestic arena for some time. I woke up
I came up with an imaginary company called Clean Energy that you have been operating in the domestic arena for some time. I woke up one morning and decided it is time to go international. I need assistance describing the environment in which my company will operate and the critical operational factors that must be consider and how they will affect my company. Can you the answer you provide be super thorough and meticulous
Below is the company I came up with and the an overview of my company (Clean Energy)
This is a description of my company, its operations, relative size, and reason for deciding to go international.
To create sustainable renewable energy solutions to cover the energy demand of every community and industry around the world" is the mission statement of Clean Energy. Clean energy is renewable energy resource company dedicated to finding new, innovative ways to create renewable energy resources for companies, while promoting a cleaner and safer environment. Renewable energy is energy that comes from natural resources therefore, it can constantly be replenished. For example, some sources of renewable energy are sunlight, wind, and water. Clean Energy was established in 2010 starting with only five employees. Today, Clean Energy consists of 300 hundred employees and has locations on the island of Grand Bahama, New Providence, Abaco, Eleuthera, and Andros. The service the clean energy provides is consultations to determine which renewable energy resource will be the right fit for the company and installation, which includes installing the renewable energy resource and ensuring it connected to the power grid of the place of operation. Moreover, the operation of Clean Energy is divided into "front end" and "back end". The front end of the operations consists of ensuring all products that clients have order has been installed in a timely fashion, is functioning properly, receiving feedback from clients, and ensuring that all clients are satisfied with the service they have received. On the other hand, the back end of the operations encompasses hiring the qualified people to construct renewable energy models, training employees on how to complete installations properly, ordering materials for installations, sourcing clients, studying to ensure each client get the resource that is the best fit for their company, creating ways to create innovate renewable energy resources, marketing the company, creating budgets for each year, creating monthly forecast, staying abreast in changes in technology, and searching for ways to expand the company. Recently, Clean Energy has decided to expand the company to Naantali, Finland. Clean Energy has decided to take the plunge and expand to Finland because the weather conditions, corporate tax rate, skilled work force, government support, and the funding offered to international businesses.
As stated, Clean Energy has decided to expand to Naantali, Finland for several reasons. The first reason the company has decided to expand to Finland is the weather conditions. Naantali, Finland is known as the sunniest place in Finland, this is perfect for renewable energy resources like solar energy. Another benefit to expanding to Finland is the low corporate tax rate. Finland's corporate tax rate is 20 percent and is one of the lowest tax rates among the countries in the European Union. The benefit of this low corporate tax rate is there will be more disposable income for the company which will increase the gross national product (GNP). Additionally, Clean Energy has decided to expand to Finland because of the skilled labor force. Clean energy plans to bring employees from The Bahamas initially but is determined to employee as many Finnish people as possible. According to the World Economic Forum's Global Competitiveness Report 2019, Finland has the second highest most educated and experienced workforce, that is known for exceptional productivity and commitment to the job. Moreover, the organization made the decisions to expand to Finland because of the government's support. The government of Finland is kin on making renewable energy the main source of energy in Finland. The governor of Finland wants to reduce the amount of greenhouse gas emissions and move toward renewable energy resources, with hopes that Finland will be carbon neutral by 2035(Maki, Finland - renewable energy 2021), this makes Finland an ideal country for Clean Energy. Finally, Clean Energy has decided to expand to Finland because of the funding available to foreign owned companies. Finland grants lowest interest loans to foreign companies that employee less the 250 people. Also, international businesses that employee Finnish people and protect the environment are more likely to get loan approval(Nevanper-Hyvnen, 2022).
This is an entry strategy my company will use and why.
Clean Energy plans to uses exporting entry strategy to start business operations in Finland. The exporting entry strategy is the direct sale of goods or services in the host country. With this entry strategy Clean Energy will still manufacture and create as normal and have the products shipped to Finland. Clean energy has decided to use this entry strategy because it is low risk and cost effective. This strategy is low risk because the organization will not have to find a new manufacturer, they can continue to use what has been working for the company. Additionally, the organization has decided to use this entry strategy because it is cost effective. It is cost less money to use the current supplier and distributor in the United States, than to find a new supplier in Finland. Eventually, the company hopes to establish its presence in Finland and start having products manufactured in the host country but not initially. The disadvantage of this entry strategy is the rising transportation costs may increase the price of products and services.
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