Risk Capital Investment

Risk capital investment

Introduction

Today, we live in a highly competitive world in which we must be more effective in making decisions at the business level. We must study the markets at a social, political and economic level because this will be released by the strategies for the development of products and/or services, market analysis, investment capital, budgets and analysis of the return on investment. 

A determining point when establishing a company, whether at local and international level, is the process of evaluating investment capacity, since this determines how capital, monetary and time resources will be allocated, because it is expected to obtainThis some type of profit or performance in the future. The time investment begins to be carried out from the conception of the business idea, where the development of goods or services is determined and what will be those potential markets that are expected to be impact. 

Through this process the characteristics of these goods or services are established and that they are aimed at satisfying a market need. Horizontal differentiation that is the analysis of variety of products based on colors, textures, sizes, packaging, among others, must be established, which must arise from the cultural perspective of the market to be impacted. In addition, vertical differentiation must also be evaluated, which is focused on the quality factor, how willing is the consumer to pay indistinctly of the quality of the good or service.

Developing

• Investment: Refers to the activity of allocating resources, capital, time and/or liquid by a company, of which it hopes to obtain some type of profit or performance in the future.
• Direct Foreign Horizontal Investment: It is when the company determines allocating resources in a foreign country, in which they carry out the same operations as in their country of origin.
• Direct foreign vertical investment: in this case the company determines allocating resources in a foreign country, but only performs part of the operation and not all of it, based on the comparative advantages of the countries.
• Horizontal differentiation: refers to differentiation based on variety. This is, in the various attributes that the product or service may have. We refer, for example, to color, texture, size, location, etc.
• Vertical differentiation: Refers to quality differentiation. In this case, consumers agree on what goods or services have a greater or lesser quality. Consumers prefer higher quality at least. However, not everyone will be willing to pay the price.
• Franchises: as established by the Blog Emprendomas;The franchise "is a system of collaboration by which a person (franchisor) yields to others (franchisees) a brand, product or service proven and profitable and a specific knowledge-tan to properly manage a business"

Beyond evaluating the possibilities of goods, services and each of the aspects that integrate them, the possible business models that are aligned to meet the organizations goals and are appropriate to the market to establish. There are various business models, among them, are the following;The franchise model, strategic alliances and "joint ventures". 

The licensing and legal aspects required for each of these models of variation. As established by the Blog Entrendíomas;The franchise "is a system of collaboration by which a person (franchisor) yields to others (franchisees) a brand, product or service proven and profitable and a specific knowledge-tan to properly manage a business". 

Franchises are considered a profitable business model, since any investment requires a level of risk and in this model, the risk is minimized because it is carried out under a business studied and established. On the other hand, strategic alliances are taking great boom because participating companies increase their level of competitiveness. According to Schaan, Kelly & Tanganelli and Cito, "strategic alliances constitute an important instrument that companies can use to maintain and improve their competitiveness in highly complex and changing business environments". 

conclusion

Alliances arise from an evaluation process of each company and how they can establish commercial ties together with others to achieve competitive advantages and be able to monopolize new markets. In addition to these models, the “joint ventures” has also emerged, which is a joint business that establishes an agreement between several companies to carry out a commercial activity that offers yields in the future. 

The strategic alliance and "joint ventures" differs in that the first one is a type of collaboration that does not require capital investment, while the "joint venture" is a cooperation with or without capital investment. The ‘Joint Ventures’, agreements achieved where the contribution of resources, technology, knowledge, infrastructure, but also, results are the risks and how they will assume them, in addition to the division of the benefits. It is not necessary for a fusion to occur between them because legally their independence prevails.

 Knowledge, infrastructure, but also, it is reviewed are the risks and how they go, in addition to the division of benefits. It is not necessary for a fusion to occur between them because legally their independence prevails.