ACME International Business MNE: Financing Research Paper

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A joint venture with companies in the homeland of the new facility is a distinct possibility. The great advantage of joint ventures is that the home company knows and understands the cultural environment better than that of a MNE. "Each member of the joint venture retains ownership of his or her property. And each member of the joint venture shares only the expenses of the particular project or venture… Joint ventures enjoy tax advantages over partnerships, too. Capital Cost Allowance (CCA) is treated differently. While those in partnerships have to claim CCA according to partnership rules, those in joint ventures can choose to use as much or little of their CCA claim as they like" (Ward 2011).

The Starbucks Corporation has had great success with joint ventures in its expansion overseas.

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"In markets outside the continental United States (including Hawaii), Starbucks' strategy was to license a reputable and capable local company with retailing know-how in the target host country to develop and operate new Starbucks stores" (Starbucks case study: Public Company, 1999, McGraw-Hill). Local companies can help Acme negotiate local bureaucracy, deal with labor issues and regulations that might be unfamiliar, and generate goodwill by creating the impression that Acme is not an interloper, but has a genuine desire to give back to the community because of its partnership with a trusted domestic entity. Given that the production facility will remain in the international location for many years, such 'fringe benefits' of goodwill and good publicity tip the balance in favor of using a joint venture to support the project......

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"ACME International Business MNE Financing" (2011, August 20) Retrieved May 19, 2025, from
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"ACME International Business MNE Financing", 20 August 2011, Accessed.19 May. 2025,
https://www.aceyourpaper.com/essays/acme-international-business-mne-financing-44083