Since then, the furniture industry in India has glorified and is currently the second largest establishment after agriculture (Paoletti, 2009).
Canada, being the 5th largest exporter of furniture in the world, has an export-oriented industry (Buisson, 2011).
A Canadian Furniture Company wants to expand its business by internationalizing the firm to serve the global market.
India seems to be a very good option for Canada since India provides low costs labor, high quality timber products and domestic market with increased consumption.
Being responsible for expanding the company beyond Canada, one must critically evaluate the ways of penetrating the Indian market, which however requires an ample amount of groundwork and endurance.
Importing – Palliser imports more costly traditional labour intensive wood furniture from Far Eastern companies and re-sells this furniture on the market.
Palliser recognizes that they cannot compete on labour cost however; the company remains competitive purchasing completed units and selling them through their distribution system.It has been India's tradition of manufacturing good quality furniture through small-scale handicrafts as also through large companies.The concept of standardization of lifestyle, interior designing, quest for comfort and architecture have got an added value thereby making furniture industry a great platform for art, style, technology and beauty (Shivcreations, 2010).Of all the existing entry modes into the foreign market, Joint ventures are most widely practiced form of business organization in emerging economies (Vaupel & Curhan 1973).Even Fortune 500 companies of the developed countries are involved in such type of entry mode (Janger, 1980; Harrigon, 1985).The furniture sector in India has been predicted by the consultants to report growth larger than the global average for the next ten years.It is estimated that Indian furniture market is worth Rs. With this perspective in mind it is established that foreign investors have a great scope in the Indian furniture market.A Bangalore based Beer Company which is serving the local Indian market from many years, having a very strong hold in their local market, is willing to share the foresight of the organization for resolution of the treaty.The proposal of joint venture is suggested to the Canadian company by a trusted contact thereby being advantageous.Capabilities – in addition to capacity, Palliser has the capability to produce significant levels of furniture within their 8 factories located internationally (4 factories in Canada and 4 factories in Mexico) along with other owned facilities in the US.The organization also has the ability to make particle board and upholstery fabrication.