The crowd begins screaming all sorts of advice. You know all three doors are valid entryways, but you have to make the best choice for your situation. Show host Monty Hall is patiently awaiting your decision.

You blurt out, "I'll take door number . . ."

Fortunately, real life expansion into the European continent doesn't have to be a game of chance. By properly doing your homework, sizing up your company's needs, and taking advice from qualified experts, you can determine which shoe fits best. Each method -- joint venture, acquisition, or greenfield -- has its pluses and minuses.

Acquisition is most common path
Richard K. Greene, a managing consultant for the International Location Advisory Services of Ernst and Young, Utrecht, Netherlands, says U.S. companies seem to be favoring door No. 2 -- acquisition.

"Acquisition is by far the most popular type of investment by U.S. companies -- I can say that unequivocally," Greene says. "I don't see that trend dying.

"You have immediate use of facilities, the labor is already hired, and you have an existing customer base. It's the quickest way to gain access."

Gene DePrez, national director, global location strategies for Price Waterhouse, New York, says companies can hit the ground running with acquisitions.

"You'll have the knowledge of the market, and market penetration. You'll be familiar with the regulatory environment, and the labor force. You'll know what the supply chains are," DePrez says. "You can be up and operating quickly."

However, Jan Scheers, partner with Price Waterhouse, Brussels, Belgium, cautions that the limited disclosure regulations for acquisitions or joint ventures sometimes result in financial surprises for American companies.

Greene agrees there are drawbacks to acquisition.

"Existing work force may already be up the pay scale. The facilities might be older, and the company might be having some difficulties in competitiveness," he says. "There could be work force issues that have been ingrained for decades."

Fresh start with greenfield
Anytime a company enters a new country or continent, there will be cultural and national differences to deal with. That shines as an advantage for greenfield sites because the corporate culture can be brought in fresh, rather than inherited, as is the case with an acquisition or joint venture.

"Greenfield is a longer term method, and requires much more planning. It may take 11/2 to two years," Scheers says. "The advantages are you can set up exactly where you want -- you have optimal location. You can benefit from the [government] incentives offered. It also allows you to fully implement the corporate culture from the beginning."

Greene noted one Big Three automaker with vast experience was struggling with a recent acquisition.

"They are finding it difficult to bring the acquired company into a truly international company, to have the same processes as other company departments," he says.

For that reason, companies -- especially large ones that have experience in European operations -- are not hesitating to build new plants. Besides the advantage of having a new building and equipment, the companies only have to pay for fixed assets of the plant, rather than the additional funds for "blue sky" or goodwill that comes with an acquisition.

Bill Pijpers, vice president, corporate locations, Buck Consultants International, Nijmegen, Netherlands, says greenfield operations allow specific efficiencies and procedures to be transferred overseas.

"If you have a plant in the U.S., you can duplicate it in Europe so you have the same standards and processes already in place," says Pijpers.

Joint ventures: Too good to be true?
Joint ventures are popular because they bring a local, knowledgeable partner on board while sharing the risks of a new venture. Yet, they also have a dirty little secret.

"The failure rate of joint ventures is horrifying," Scheers says emphatically. "I've seen reports that say 80 percent of joint ventures eventually fail. This is due to cultural differences, or difficulties in joint managing. Typically, they split up and go their separate ways."

Smaller companies are often the victims because partnerships appear to be the most attractive way of entering the market.

"Joint ventures are appealing because you're splitting the risk," says DePrez. "Yet the real risk is it won't work in the long run."

John Chopack, international tax partner, KPMG, New York, agrees that joint ventures tend to have a high failure rate.

For this reason, he says companies should have a plan on how to get out of the market.

"Some companies go into this quickly and they don't structure it properly. When they are first going, things are very positive," Chopack says. "But what happens when this thing blows up?"

But, like anything, there is another side to the coin.

Joint ventures are ideally suited for companies that can combine strengths and weakness to form a solid partnership. For instance, a company may have a strong sales force, but lack in solid products, while another firm would have the opposite attributes.

Richard Schuhmertl, U.S. project director, Austrian Business Agency, in Vienna, says joint ventures are popular in his country.

"Joint venture is a form of getting a feeling for the market without being alone," he says. "It is the most favorite strategy U.S. companies are using here in Austria."

Jean-Claude Goldenstein, managing director of JCG International Inc., New Rochelle, N.Y., predicts the strong tide of acquisitions and joint ventures will continue. He says American and European companies are pooling their technical, financial, and marketing resources to more quickly develop win-win relationships on both sides of the Atlantic.

Treading softly
Regardless of the method of entry, experts say U.S. companies -- while attempting to implement their own corporate culture -- still need to adapt to European business style.

"Accept that Europe has different rules," says Schuhmertl. "Whether they like it or not -- there's no personal thing here -- accept it."

Greene says too many companies try to import their U.S. culture, which can lead to problems down the road.

"They take their experience from the U.S., where it is more autocratic. The boss says this, and this is what you do," Greene says. "In Europe, the workers participate more."

Getting their toes wet
The reality is that rarely do U.S. companies charge into Europe without having some experience in overseas facilities. That often comes by first establishing a one- or two-person sales office somewhere, or opening a small distribution warehouse. In this manner, companies get their toes wet in the world of international business.

James A. Schriner, director of location strategies, Deloitte & Touche Fantus Consulting, in Princeton, N.J., agrees most companies follow a one-step-at-a-time growth pattern.

"Most companies enter Europe with a sales office. If that goes well, then they may go into public warehousing," Schriner says. "After they get some experience doing business overseas, then they may look at a partnership or other options."

Surprise, surprise, surprise
Austria's Schuhmertl says some U.S. companies run into surprises, but that is because they simply haven't done their homework.

"Some U.S. companies are surprised about the regulations here, if they're not experienced in European affairs," he says. "In many cases, they're not familiar with the legal system or the bureaucracy."

In addition, Schriner says companies need to have their "political antennas" up when selecting a site.

Schriner also says a fact of life is that payments are sometimes required to government agencies in Eastern Europe (and Asia) to expedite paperwork.

"In the U.S., you can go to jail for these types of payments," says Schriner.

It also has been his experience that people are not as willing to move in Europe to find a better job, compared to U.S. workers.

"Europe is not nearly as dynamic or shifting in its population."

Chopack says some companies neglect to discover concealed costs of doing business.

Some of those unseen costs include high social service charges, such as for medical and pension plans, which are much higher than in the United States. Some countries have many more paid holidays, and the labor structure is different.

Choosing a different path

"Could you outsource the manufacturing to someone else?," asks Pijpers. "A lot of companies are doing that to reduce risk. Companies like Hewlett-Packard and 3Com are using contract manufacturers. That is also a strategy."

He also noted that many companies use a third-party call center in order to easily establish a sales presence overseas.

"We have one client who grew through various acquisitions," Greene says. "But they now have some duplication. They have some labor relations they inherited that weren't necessarily the best. So what they've chosen to do is close down the acquired facilities and open up a new one through greenfield."

He explains that acquisitions allowed his client to get established, build a sales force, and have a customer base and supplier chain. Now as they move forward, they find they need new facilities to remain competitive, and greenfield is the best opportunity for them.

Taking the initial step
For companies contemplating entering the European market, experts say a series of parameters must be set first. These include identifying existing and potential markets, setting and sticking to strategies, and closely studying where customers are and will be in the future.

Sources for information abound. They include:

• Trade and industry associations

• Local and foreign chambers of commerce

• Government agencies

• Local economic development agencies

• International consultants

• Investment bankers

• Companies already located abroad

Greene stresses that despite globalization and a move toward a single currency, companies need to study the variances within Europe when taking the initial entry steps.

"There are so many differences -- quantifiable differences -- between countries. That includes labor, transportation links, cost of land, political, educational, utility costs, quality of life, among other factors," Greene says.

The bottom line is that while there is risk involved in any kind of foreign investment, companies that do a thorough study of all the options come out best.

JCG's Goldenstein quoted the famous French scientist Louis Pasteur, who said, "Chance favors the prepared mind."