1.

According to their Website, CEMEX has operations in more than 50

countries; I believe their 51st country of operations should be in
China. Currently right now CEMEX is in a lot of the North American
and European regions, while slightly slacking in the Asian regions.
The European market is also very concentrated with competition
being very high, making opening up another location in Europe not
seem to appealing to many. By opening their next location in a
Chinese market, it will open a lot of doors into the Asian region, by
slowly then expanding throughout once getting developed. For
example, if they were to get started out in China and get
established in that specific Asian market, then open up in Vietnam,
Cambodia, and the rest of the South Eastern Asian markets, it would
be a great beneficial potential for CEMEX. The reason why I
suggested China is because I believe CEMEX should continue their
global expansion by targeting developing nations, where the
demand for their products is expected to grow. Having of personally
traveled to China and many other places in and around Asia, I can
personally say that the need for the cement industry is much
needed in these regions to help develop their countries. According
to my past travel experiences and the CEMEX locations presented to
me on their website, I believe the next best move for CEMEX as a
company would be to make their 51st country expansion into the
Asian market, but more specifically China.

2. Based on CEMEXs criteria of market selection and the CAGE

framework, South Africa looks like it could be a great potential for
the next country for CEMEX to expand into. The CAGE framework
looks at the cultural, administrative, geographic, and the economic
distance framework to help managers or whoever recognize and
evaluate the influence of distance from the home country on an
array of different industries. Below I am comparing the CAGE
framework with their home country of Mexico to their expected
expansion country of South Africa.

Cultural: A countrys cultural attributes can establish how different

people cooperate and communicate with one another and with
different companies. Having a difference in religion, race, social
norms, and language all influence the distance a country can
distant themselves from another country. While the main language
of Mexico is the Spanish language and the main language of South
Africa is Zulu (English is only spoken by 10% of the country) this
could be a possible communication for the two countries, and could
create a lack of trust among consumers. I dont see religion being a
big difference between the two countries, Catholic and Christians
shouldnt distance each other like a Catholic and Muslim or Buddhist
religions would.

Administrative: Are any historical and political associations that are

shared by countries. Mexico and South Africa have a great
relationship with one another. A minor problem I see is the
exchange rate between the Mexican and the South Africa dollar,
creating an administrative distance between the two countries. 1
Mexican Peso is only .65 South African Rand, compared to what the
Peso can be exchanged to in other countries, Mexico might get a
better exchange rate if they decide to expand into a different
African country other than South Africa.

Geography: Geography is not only measured by how far you are

from the home country (although the further makes it more difficult
to run), but its also important to take into consideration the size,
the accessibility, and the topography of the country. With that all
being said, South Africa makes a perfect geographic location for one
to expand into. Not only are they the worlds 25th largest county, but
they also have access to waterways, making it is to import and
export materials in and out of the country when needed.

Economic Distance: is the wealth of consumers and is surely one of

the most important, if not the sole important economic attribute
that will create distance between countries when expanding
globally. South Africas GDP is a total of $742.461 billion, placing
them 30th in the world, while their per capita is at $5,859, placing
them 88th. Both rankings are relatively great, and both mean that
CEMEXs products would do well considering the market value of
goods produced in South Africa.

All in all, given the CAGE framework, South Africa looks like a
promising country for CEMEX to expand their company into.
Although language barriers could pose a possible threat, and the
dollar value on the exchange rate could be better, they could make
up for it in the geography size, the access to waterways, and the
GDP of South Africa.

3. The importance of the factors in the CAGE framework would be

different for CEMEX than they are for Zara in many different ways.
Firstly, Ghemawat says that different types of distance matter to
different extents depending on the industry that you are working
with. For example, when talking about geographic distance, costs
affecting transportation should only be an importance to companies
who have heavy or bulky products that they are producing. While on
the other hand, you have cultural distance, where affects the
consumers product preferences. Simply put, for Zara to use the
CAGE network clearly wouldnt make sense for them. Zara, unlike
CEMEX, has a head office in every country that they operate in.
Zara uses the oil spill technique, which is them opening up a head
office in a country, then branching out with more stores, further
from that head office location. So transportation costs are low, they
develop a sense of what the consumers are looking for, etc. While
on the other hand, CEMEXs head offices are in Mexico, and many of
the day-to-day operations and overall decisions get facilitated
through them.

Also, I found this YouTube video that highlighted important parts of

the CEMEX company, where they had their operations and what
they stood for. It helped me grow a stronger sense for the company.
https://www.youtube.com/watch?
v=dLAgGcZGeVA&feature=youtu.be