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Planning For International Market Entry PDF
Planning For International Market Entry PDF
1
Selecting a Market Entry Strategy
Explains the different market entry strategies organizations will use for a successful business venture.
2
Finding the Right Partners
Outlines the processes an organization should follow to select a partner that will be best suited for a joint
venture.
Explain the types of market entry strategies and considerations for both products and
1 services in terms of their application, advantages and disadvantages.
Select the most advantageous market entry strategy for an international venture
2 based on the results of feasibility research, risk analysis and competitive analysis.
Develop a strong international business plan including key business strategies with
4 identified metrics upon which the organization can monitor progress, successes and
weaknesses.
5 Develop a strategic plan for market entry, based on the international business plan.
What are the four types of foreign direct investment-related (FDI-related) market
1 entry strategies?
What are three sources of information about potential international business partners
3 and how they can be helpful?
4 What is the difference between an international business plan and a strategic plan?
5 What are five things for which an international business plan can be used?
UNIT 1
Selecting a Market Entry
Strategy
◎ Assessing Feasibility
◎ Gathering Competitive Intelligence
◎ Types of Market Entry Strategies
◎ Market Entry Considerations
◎ Trading Entry Strategies:
o Direct Exporting
o Indirect Exporting
o E-Commerce
Continued…
© 2017 FITT All Rights Reserved
Planning for International Market Entry: Making
Choices and Establishing the Route to Global Success
UNIT 1
Selecting a Market Entry
Strategy
◎ Investing Entry Strategies, Transfer-Related:
o Licensing
o Franchising
o Subcontracting
o Strategic Alliances
◎ Investing Entry Strategies, FDI-Related:
o Branch Office
o Joint Venture
o Greenfield and Brownfield Investments
o Mergers and Acquisitions
◎ Market Entry Strategies for Services
© 2017 FITT All Rights Reserved
Why Is This Important?
Risk Analysis
Cost Analysis
A critical step in determining feasibility, a number of cost analyses may be generated
using different assumptions.
• Sales strategy
FIGURE 1.2
o Resources o Investment
o Remittance o Risk
o Competition o Flexibility
FIGURE 1.2
o Wholesalers
o Distributors
o Retailers
o Consumers
Government Procurement
Continued…
TABLE 1.3
TABLE 1.3
ADVANTAGES DISADVANTAGES
• Controls over manufacturing processes • Need for significant investment in
research
• Can withdraw from market
• Errors due to lack of experience and skills
• Can obtain in-depth information
• Difficulty breaking into trade blocs
o Email marketing
FIGURE 1.2
ADVANTAGES DISADVANTAGES
o Attractive if organization has valuable IP o Entry to target market is limited
o Can enter markets that have restrictions o Terms of licence must be monitored and
o Benefit from licensee’s local market knowledge enforced
o Can avoid the use of capital o Licensee might use IP to become a
o Can maintain option to expand competitor
o Can move into several markets at once o Intensive research and planning is required
ADVANTAGES DISADVANTAGES
o Local presence without having to invest o Reputation of local partner will impact
o Avoid problems with cultural and language organization‘s reputation
differences o Requires substantial commitment, careful
o Requirements for accreditation are met by selection of partner
partner o Need for contract with effective dispute
o Partnerships often receive tax benefits mechanism
o Organizations can bid for contracts in local
market
FIGURE 1.10
ADVANTAGES DISADVANTAGES
o Simple way to establish presence o Costs could present tax or legal problems
o Supports responsive, customer demand o Property leases
o Complete control o Expensive, time consuming
o Can train staff to personal preferences o Assume responsibility for every link in
distribution chain
o Direct contact with end-users
Retail Outlets
Some organizations create a network of retail outlets. These can be either owned/operated by the
parent company or by operators with a relationship to the parent company.
ADVANTAGES DISADVANTAGES
o Provides higher sales volume, greater o Must relinquish some control
market penetration and profit potential o Can be difficult to regain funds from
o Local partners = reduced animosity o Problems related to sharing of profits: need for
carefully negotiated agreements
o Government-provided incentives
ADVANTAGES DISADVANTAGES
o Riskiest and most expensive o Investment may be substantially limited
o Must be committed to long-term o Carefully planning needed to determine best
o Investment may be welcomed, encouraged form of investment
o Well-funded organizations = opportunities to
enter new market with high level of control
o Profits do not have to be shared
Licensing Services
Franchising Services
UNIT 2
Finding the Right Partners
◎ Assessing Organizational Readiness and Identifying Gaps
◎ Defining Desired Business Partner Characteristics
◎ Finding Business Partners
◎ Determining Whether Organizations Are Complementary
◎ Performing Due Diligence
Size
Capabilities
o Technical skills and resources o Financial resources
o Management resources o Competitive advantages
Business Associates
Governments
See Table 2.1 Selected Government
Sources of Assistance
TABLE 2.1
Business Associations
Business Advisors
Financial Institutions
Commercial Databases
o Attitudes
o Operations
FIGURE 2.1
UNIT 3
Preparing an International
Business Plan
◎ What is an International Business Plan?
◎ The Planning Process
◎ Core Content
◎ The One-Page Business Plan
◎ A Note on Strategic Plans
◎ The Planning Cycle
o Provide benchmarks against which to compare the progress and performance of the
business over time.
o Create an original plan that is done specifically for each business case.
o Outline the key points in each section before the writing starts.
o Consider writing the executive summary as the last step in the process.
Telling a Story
o A trend in business planning is to use a narrative structure.
o Storytelling helps create personal and organizational brands, deliver marketing and
develop persuasive plans.