The case of Korean Juju Motor Company
The case of Korean Juju Motor Company which is considering building a new plant In Canada has not occurred solely in recent business field. Similar situations can be seen frequently nowadays, that foreign manufactures want to invest in building new operations in Canada.
Considerable reasons for this phenomenon can be listed from the perspective of economy, environment, employment and the deference In International marketing regulations.
From the economic point of view, opening new operations in a foreign country would bring more economic benefits for the original company, because the original company has a bigger market. Also, the Influence of the original company could be enhanced and has a greater chance to become an International brand. From the perspective of environment, establishing a new company In another state would Impact the environment of the foreign country Instead of the domestic environment.
However, In the particular case of Korean Juju Motor Company, whether the cost of the labor would be extremely high has sparked much debate. This concern is quite groundless since the standards of consumption would be different in these two countries.
For example, a pair of sweat pants gets to sell in Korea for 5,000 South Korean won (approximate 5. 32 Canadian dollars), since the level of consumption in Canada is a bit higher than in Korea, people can accept a pair of sweat pants for 10 Canadian dollars.
The higher cost of labor would not be a robber since the income of the company would be boosted at the same time. More people are concerned about the strict employment regulations; however, it is obvious that the advantages of planting a new company in Canada outweigh this single difficulty. In other words, different laws and regulations can be absorbed by the new company easily; the original company should not give up the great opportunity to open a new company in the foreign country since numerous advantages on economy, environment, and employment.