Joint Venture Problems: Collaborative Engagement

Name Professor Title Date Joint Venture Problems Joint ventures are a collaborative engagement of two or more businesses to work on short term business deal or for a long term purpose. Unrelated companies intend to go this direction to combine resource or creatively join their unique expertise. When a business takes the course of a joint venture, the advantages seem favorable than to the company. The promising benefits are usually numerous but with benefits also come with risk (S De Sousa, I Lopes and E Nunes 2013). This paper will list and discuss the problems or challenges in a joint venture that arise on the initial stages of negotiation or when the formation organizational structure or difficulties that arise from the global nature of the investment. The idea of businesses joining to share resources and expertise always brings more benefit to the activities involved. The significant advantages experienced in the area of productivity; companies with shared support have an exponential productive curve compared to the single venture. Also, the growth and expansion of the company are visible on the same exponential curve and more, so profits margin have a record high compared to singles ventures (Prasitsom, Likhitruangsilp 128-148). The benefits of joint ventures are the driving force of many businesses to take the mutual route, and in the foundation, the negotiation recorded in a document of agreement on how the new association will run. In commercial law perspective, a...