Professional Documents
Culture Documents
Chapter Overview
1. Target Market Selection
2. Choosing the Mode of Entry
3. Exporting
4. Licensing
5. Franchising
6. Contract Manufacturing
7. Joint Ventures
8. Wholly Owned Subsidiaries
9. Strategic Alliances
10. Timing of Entry
11. Exit Strategies
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Introduction
The need for a solid market entry decision is an integral
part of a global market entry strategy.
Entry decisions will heavily influence the firms other
marketing-mix decisions.
Global marketers have to make a multitude of decisions
regarding the entry mode which may include:
(1) the target product/market
(2) the goals of the target markets
(3) the mode of entry
(4) The time of entry
(5) A marketing-mix plan
(6) A control system to check the performance
markets
in the entered
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Chapter 9
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Classification of Markets:
Platform Countries (Singapore & Hong Kong)
Emerging Countries (Vietnam & the Philippines)
Growth Countries (China & India)
Maturing and established countries (examples:
South Korea, Taiwan & Japan)
Company Objectives
Need for Control
Internal Resources, Assets and Capabilities
Flexibility
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1. Exporting
Exporting is the most traditional and well
established form of operating in foreign
markets.
Exporting can be defined as the marketing
of goods produced in one country into
another.
An aggressive exporter
develops marketing strategies
which provide a broad and clear
picture of what the firm intends
to do in the foreign market.
Piggybacking
Piggybacking is an interesting development.
The method means that organizations with little
exporting skill may use the services of one that
has.
Another form is the consolidation of orders by a
number of companies in order to take advantage
of bulk buying.
Countertrade
By far the largest indirect method of
exporting is countertrade.
Competitive intensity means more and
more investment in marketing.
2. Licensing
Licensing is defined as "the method of
foreign operation whereby a firm in one
country agrees to permit a company in
another country to use the manufacturing,
processing, trademark, know-how or some
other skill provided by the licensor".
3. Franchising
Franchising refers to the methods of
practicing and using another person's
philosophy of business.
The franchisor grants the independent
operator the right to distribute its products,
techniques, and trademarks for a
percentage of gross monthly sales and a
royalty fee.
4. Contract Manufacturing
Contract manufacturing is work subcontracted to a manufacturer by a
company that owns the product design
and IPR.
In some cases, the manufacturer takes
the responsibility of marketing the
products using the vendors brand and
provides after-sales support
5. Joint ventures
Joint ventures can be defined as "an
enterprise in which two or more investors
share ownership and control over property
rights and operation".
7. Strategic Alliance
A Strategic Alliance is a formal
relationship between two or more parties
to pursue a set of agreed upon goals or to
meet a critical business need while
remaining independent organizations.
A company's commitment to
international business and its
objectives for going international
are important in establishing
evaluation criteria.