The paper "Strategic Challenges Encountered by MNEs to Enter Developed Nations" is a perfect example of a business assignment. Multinational Enterprises (MNEs) are becoming popular phenomena around the globe, with an increasing number of MNEs, trying to capture one market after another and widen opportunities, these enterprises have gained momentum in the global arena. MNEs are mostly concerned with the fulfilment of long-term goals, including gaining a high amount of profits in return for the goods and services they provide to their customers. Hyundai Motor Company is one such established MNE, which has gained a significant level of reputation and huge market popularity as one of the top players in the automobile industry, especially within its car segment (Teece, 2010).
Hyundai is a South Korea based MNE, which encountered several challenges, while trying to establish itself in the developed nations such as the U. S. MNEs, other than Hyundai, has also faced a number of challenges while entering the foreign market, especially in the developed nations (Southerton, 2014). Hence, the aim of the question is to provide insight towards developing better knowledge of the various challenges that are being faced by MNEs while trying to enter the foreign markets. ChallengesOne of the prominent challenges faced by the MNEs in developed nations is the presence of a high level of competition prevailing in those nations.
A high level of competitiveness that is imposed by already established global and local players, can act as a hindrance since it would lead to the inability of the MNEs to gain valuable market share and enhance profitability in a new market. Furthermore, a high level of competition can act as a barrier to entry, since it could possibly lead to chances of facing severe losses.
In addition, MNEs face the challenge of understanding the new environment in the developed nations, which may be dissimilar to the different rules prevailing in the home country environment. Understanding of new environment requires making use of the CAGE framework, which provides an outline of the various Cultural, Administrative, Geographic and Economic (CAGE) differences, underlying a developed nation and the home nation (Son, 2006).
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