Mexico’s largest cement manufacturer

Cemex, has release a global powerhouse In the cementum and construction Industry. It shortly entertains 60 portion of the cement persistence in Mexico (Hill 2009). Cemexs success is a take of a combination of efficient technology such as radio transmitters, satellites, and computer hardware that allow the company to anticipate changes in supply and demand and reduce waste. Cemexs success is also a result of an attempt to dominate the industry by getting and buying bulge out competitors general In order to expand. . Which heoretical explanation, or explanations, of FDI best explains Cemexs FDI? I think that Internalization theory best explains Cemexs FDI because Cemex has taken the initiative to enter into many an(prenominal) countries and instead of licensing they bought domestic cement businesses and have gr avouch into a worldwide powerhouse. According to the textbook, internalisation theory explains why firms often prefer contradictory direct investment over licensing as a strategy for immersion foreign markets (Hill 2009).With the advanced technology that Cemex uses, so licensing would not be the greatest venue for the company to take In order to protect Its scientific know-how (Hill 2009). b. What Is the value that Cemex brings to the waiter economy? toilet you see any effectiveness drawbacks of inward investment by Cemex in an economy? Cemex is the third largest cement company in the world, and a powerhouse in Mexico where it holds 60 percent of the market. Cemex is highly focused on efficient manufacturing and customer service. Distributors are rewarded for their sales, as are users.The primary benefit Cemex brings to host countries Involves these competltlve advantages. Cemex acquires companies and then transfers technological, management, and marketing know-how to the spic-and-span units. Improving their performance. The company has brought several acquired companies back to full production, increasing battle opportunities in the h ost country as well. c. Cemex has a strong sense of taste for acquisitions over greenfield ventures as an entry mode. Why? Cemex has successfully acquired established cement makers in many countries.By acquiring companies rather than establishing them from the ground up, Cemex can negate some of the delays that could occur in the start-up phase, while t the same time, capitalise on the benefits of an established market presence. Acquiring opposite businesses is effective because the host economy already knows the demographics and the market. Cemex would be able to make the business break down with their technology and research. A Greenfield venture would be risky and not toll effective. d. Why is bulk control so grand to Cemex?Majority control is important to Cemex because of the ability to Implement its policy of transferring resources. When It does not have majority control It may not be able to transfer its own managing resources to newly acquired companies. Also, Cemex ig ht want to take advantage of differences in factor be across countries, so it will be allowed to import parts from other places to reduce costs. References Hill, C. W. L. , Richardson, T. , McKaig, T. (2009). Global business today. Toronto McGraw-Hill Ryerson.BUSN 427 WEEK 3 Case debate By Jihadmalley Mexicos largest cement manufacturer, Cemex, has become a global powerhouse in the cement and construction industry. It currently controls 60 percent of the cement industry in Mexico (Hill 2009). Cemexs success is a result of a combination of acquiring and buying out competitors worldwide in order to expand. a. Which hat internalization theory best explains Cemexs FDI because Cemex has taken the avenue for the company to take in order to protect its technological know-how (Hill 2009). . What is the value that Cemex brings to the host economy? Can you see any are users. The primary benefit Cemex brings to host countries involves these war-ridden advantages. Cemex acquires companies a nd then transfers technological, management, and marketing know-how to the new units, improving Majority control is important to Cemex because of the ability to implement its policy of transferring resources. When it does not have majority control it may not be able