International Business Negotiation Case - Essay Example

International Business Negotiation Case The goal for the negotiations is exploring the possibility of manufacturing or assembling micro-analyzers by Systrop S.A. in Tropicalia. The micro-analyzers assembled or manufactured in Tropicalia will be meant for local consumption or for export, which will be easier to negotiate due to the government’s preference of plants meant for locally consumed products and export (Wolter 54). Being successful in the negotiations is important because there is another joint venture under discussion between Tropimatics S.A. and Eurodata, which seeks to take over the Tropicalia market and may push Systrop S.A. out of business.

In addition, because Eurodata is more successful than Tanaka, coming up with the best deal is important because the competition will be formidable. Systrop S.A. could also decide to seek a licensing agreement with Tanaka. The pros of this choice involve allowing Systrop S.A. to use a proven technology by paying a license fee instead of incurring the costs of maintenance and development of the technology. In addition, Tanaka will also get a good deal because they will get a return without incurring costs, which will help Systrop in negotiations.

The cons of licensing include the fact that Systrop S.A. will be dependent on Tanaka with regards to technology, while Tanaka could also use this for negotiation of better terms (Wolter 57). Systrop S.A. possess some extra resources in relation to the other players. First, it has grown into a position of prominence in the micro-analyzer industry, compared to Tropimatics that has dealt more with computers than micro-analyzers in particular (Wolter 65). Systrop S.A. also has a well renowned brand name when it comes to micro-analyzers in Tropicalia, while it has also been exporting its micro-analyzers compared to the other companies seeking joint ventures with big micro-analyzer companies.

Issues that Systrop could be flexible in include ownership and pricing of technology. Those issues that they should be firm on include financing, local content and exports, and their ability to take up government incentives (Wolter 67).Works CitedWolter, Stephan. Foreign Investment Negotiation Simulation - Final Report. Munich: GRIN Verlag, 2010. Print.