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USCO Logistics Incorporated: The Mexican Proposition Case Solution

Solution Id Length Case Author Case Publisher
1431 584 Words (2 Pages) Kenneth G. Hardy Ivey Publishing : 900A04
This solution includes: A Word File A Word File

The company should partner with the Privately owned public warehouse. The matrix provided in Exhibit 6 of the case shows that the management at USCO has rated this company best in most of the categories so the fit with the company should be good. The strategy to be used for partnership should be joint-venture. The reason why this strategy is more suitable than the Green fields’ entry is that the company will have less risk of making the joint venture. They will also only have to commit half the resources in initial investment while the other part will be provided by the Privately owned public warehouse.

Following questions are answered in this case study solution

  1. So who should USCO partner with? Do not choose a Greenfields entry. Look for the complementarities.

  2. What part of the Public Warehouse is most valuable to USCO? Its customers, its facilities, its software, and systems, its middle managers, its senior management, its access to cheap finance?

  3. What part of a Bank of Mexico partnership would be most valuable? What will the other banks do if USCO goes with Bank of Mexico? How can this be managed?

Case Analysis for USCO Logistics Incorporated: The Mexican Proposition

2. What part of the Public Warehouse is most valuable to USCO? Its customers, its facilities, its software, and systems, its middle managers, its senior management, its access to cheap finance?

Three most valuable parts of the Public Warehouse for USCO will be the company’s customers, facilities and the middle management. Customers of the company will be important because they will become the initial contact for USCO to penetrate into the Mexican market. The case also shows that the Public warehouse not only has initial customers, but its ability to add new customers is also better than others. Therefore, future growth of USCO will be facilitated through this aspect in the partner company.

Facilities are critical because they will be utilized by the management to provide warehouse services and without them the company will not be in a position to cater to demand especially if their projections of increased trade between US and Mexico become true. Also, the Public Warehouse has better locations and facilities as provided in the Exhibit so by partnering with them; the company will have a better advantage instead of going with banks where the facilities are not proper.

The Exhibit also discusses that the Public Warehouse has strong operating managers. This will be of significant importance because it will be these managers who will form the initial workforce after the joint venture is completed. In comparison to other companies, Public warehouse has stronger operating managers and in order to achieve operational efficiency in future years, these people will have to be used in an effective manner. Since human resource is the real asset for any growing company, this part of the acquisition should provide USCO most advantage in later years.

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