Exporting is considered to be a better way of entering into International markets than setting up wholly-owned subsidiaries abroad due to the following reasons:

a. Exporting is an easy way to enter into the international market as compared to wholly-owned subsidiaries. It is easier to establish and manage.

b. It's less involving because the firm need not invest much time and money.

c. The wholly-owned subsidiary required 100% equity investment to be made by the foreign company. The small and medium producers do not prefer this mode to enter into international business.

d. Exporting has less risk because it does not require much investment in foreign countries.

e. Wholly owned subsidiaries have a high degree of political risk as well as a high risk of loss.