The criteria MNCs use to evaluate their distributors are designed to maximize the speed and breadth of initial market penetration, but over the long term incentive distributors to seek short-term gain rather than support their foreign partner in establishing a strong market presence.
Implications for MNCs:
- As a result of this evaluation process, most MNCs have developed distributor relationships that are optimal in the early stages of market entry, but over time become less useful
- However, many companies fail to upgrade and restructure these relationship to position themselves for long-term growth.
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