Joint Ventures

Created by: kaylacharnock
Created on: 30-01-17 10:27

What is a joint venture?

When two independent businesses set up a new enterprise in which they jointly own a stake.

1 of 5

When are they commonly used?

They're commonly used when a business from one country wants to enter a new country, but prefers to do so with a local partner.

2 of 5

Any examples?

A lot of oil companies create joint ventures to seach for and then exploit oil reserves. Many western companies have created joint ventures with the Chinese, Indian and other South East Asian markets.

3 of 5

Advantages of Joint ventures

Sharing of cost- very important for expensive projects such as new aircraft. Access to local knowledge/contacts, when joint venture is already based in the country. Risks are shared.

4 of 5

Disadvantages of Joint ventures

If the new project is successful, then the profits have to be shared with joint venture partner. Disagreements over important decisions might occur. The two different joint venture partners might have different ways of running a business- language

5 of 5

Other cards in this set

Card 2

Front

When are they commonly used?

Back

They're commonly used when a business from one country wants to enter a new country, but prefers to do so with a local partner.

Card 3

Front

Any examples?

Back

Card 4

Front

Advantages of Joint ventures

Back

Card 5

Front

Disadvantages of Joint ventures

Get Revising

Joint Ventures