Module project part 1 - Assignment Example

This is because depending on the type of business that an investor wants to introduce to a particular emerging market, there may be peculiar risks and challenges that must be taken care of to ensure guaranteed success and growth. Apart from the nature of business, the vision that the investor carries is also very important in determining risk because each vision may have its own challenges that it must seek to overcome in order to achieve success. In line with this understanding, this module paper is prepared for the company, which is currently seeking to enter Mexico as an emerging market.

As part of ways of benefiting fully from the market, a comprehensive vision statement, description of the target market and risk and their mitigations shall be outlined. Vision Statement The vision statement of the company is to become a company whose success is build on an enablement created for the customer to do business with us by ensuring quality and price competitiveness. Description of Mexico as an Emerging Market Political Factors Politically, Mexico has been found to possess very low foreign debt, which makes it possible for the government to have a very huge budget reserve that is used in the financing of various businesses, especially foreign direct investment (Rutherford, 2005).

Due to this, the government has for long practiced macroeconomic policies that focus on bringing about industry wide economic leverage, instead of organizational level leverage. As part of such macroeconomic policies, investors in Mexico benefit from lower tax rates, easy access to government assisted loans, low inflation, and sufficient state protection for legally registered businesses. These political factors have made most multinational companies whose focus has been on short term expansion to look to Mexico, knowing that the political ground has been laid for business to take place in a more welcoming atmosphere (Morris and Pavett, 2002).

Economic Factors Economically, Mexico has been given a country rating of A4 by global Edge, which is a company rating firm that seeks to compare countries one to other in terms of viability in doing business in these countries (Davidson and Burke, 2004). A major economic advantage that Mexico has been identified to have is the fact that it has a ready market with the United States, which is responsible for 80% of all exports from Mexico (Schuler, 2006). For business owners who are in the manufacturing sector like the company in question, the benefit is that exportation of finished products will not pose much of a problem for the company.

Mexico has however been criticized for having a weaker exchange rate, that makes importation expensive in that country. Acquisition of raw material has therefore being a problem for most manufacturers (Hall, 2006). Social Factors Socially, Mexico’s population has been described as commercially informed (Rutherford, 2005). What this means is that the population understands the basic rudiments in conducting business and get themselves actively involved in the business market. The major factor that accounts for this is the high literacy level in the country with the aim of the government in achieving 100% enrolment with a universal compulsory education scheme.

Because most of the people are