Disney Land in Europe
Question no. 1:
What are some of the characteristics of multinational enterprises that are displayed by the Walt Disney Company?
• They have to be responsive to different forces of home country and host country at the same time although Euro Disney do not have any big competitor as it was the largest amusement park opened in France but it failed to study accurately external environment, needs and wants of people, culture, price, policies, economic, social and legal issues. They should keep local employees rather brining from foreign countries.
• They draw common pool of resources like financial, information, human both are shared by Euro Disney land with other Disney land’s in the world.
• They link different business partners within single mission vision. The company (Euro Disney land) share of venture was to be (FDI) 49%. For which it would put up $160 million other investors put $1.2 billion, French government provided a low interest $900 million loan, banks loaned $1.6 billion & the remaining $400 million was to come from special partnerships formed to buy properties and to lease them back.
• It acts as MNE because it operates in several countries i-e different parks in different countries (accepted the concept of globalization).
Question no. 2:
Why did Disney take an ownership position in the firm rather than simply licensing some other firm to build and operate the park and settling for a royalty on all sales?
Disney officials were optimistic about the project. Their U.S parks, Disneyland and Disneyworld, were extremely successful and Tokyo Disneyland was so popular that on some days it could not accommodate the large number of visitors. Simply put, the company was making a great deal of money from its parks. However, the Tokyo park was franchised to others and Disney management felt that it had given up too much profit with this arrangement. This would not be the case at Euro Disneyland. The company’s share of the venture was to be 49% ($160
What are some of the characteristics of multinational enterprises that are displayed by the Walt Disney Company?
• They have to be responsive to different forces of home country and host country at the same time although Euro Disney do not have any big competitor as it was the largest amusement park opened in France but it failed to study accurately external environment, needs and wants of people, culture, price, policies, economic, social and legal issues. They should keep local employees rather brining from foreign countries.
• They draw common pool of resources like financial, information, human both are shared by Euro Disney land with other Disney land’s in the world.
• They link different business partners within single mission vision. The company (Euro Disney land) share of venture was to be (FDI) 49%. For which it would put up $160 million other investors put $1.2 billion, French government provided a low interest $900 million loan, banks loaned $1.6 billion & the remaining $400 million was to come from special partnerships formed to buy properties and to lease them back.
• It acts as MNE because it operates in several countries i-e different parks in different countries (accepted the concept of globalization).
Question no. 2:
Why did Disney take an ownership position in the firm rather than simply licensing some other firm to build and operate the park and settling for a royalty on all sales?
Disney officials were optimistic about the project. Their U.S parks, Disneyland and Disneyworld, were extremely successful and Tokyo Disneyland was so popular that on some days it could not accommodate the large number of visitors. Simply put, the company was making a great deal of money from its parks. However, the Tokyo park was franchised to others and Disney management felt that it had given up too much profit with this arrangement. This would not be the case at Euro Disneyland. The company’s share of the venture was to be 49% ($160