![]() Even when they share multiple mutual goals, it is not always possible for the two to align perfectly. One of the most common reasons for JV’s to fail is due to disagreement in strategic decisions. These differences are often associated with cultures, languages, and development plans. Having a local partner(s) can sometimes bring disadvantages to foreign companies, mostly from the differences in working style. Hence, the addition of a foreign company is considered a competitive advantage over local peers in the same industry. Meanwhile, the foreign partner is expected to bring experience of globalization, technological innovation, and know-how, which typically are the weaknesses of the local party. They can also provide insights about local practice, as well as established relations with relevant stakeholders, such as suppliers and distributors. Your partner will support with related paperwork and documentation, as well as deal with local authorities. ![]() You and your partner can then bring your own strengths to further develop the JV. Access to local expertiseĪ great benefit of a JV is that you can utilize the local experience and network of the domestic Vietnamese partner.įoreign companies can establish their footprint in the domestic market while enjoying external support from someone familiar with the market for years. However, this is more complicated and requires significantly more resources from the investors, both in terms of legal documents and human capital. Therefore, establishing a JV might be the only way in for foreign companies in certain industries.
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