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Good E vening! INB3107 International Business Management
December 2016/J anuary 2017 Ulrich Werner
Good E vening! INB3107 International Business Management - - PowerPoint PPT Presentation
Good E vening! INB3107 International Business Management - - PowerPoint PPT Presentation
Good E vening! INB3107 International Business Management December 2016/J anuary 2017 Ulrich Werner When, where, and how to enter a foreign M arket? International Business M anagement L ots of Questions to considere M odes of entry?
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L
- ts of Questions to considere
- M odes of entry?
- Which foreign country (first)?
- When?
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First M over Advantage
- How to structure and organize your firm to enter a
new market
- First mover advantage
– Brand recognition – Establishing yourself in the market – Learn about national practices, norms, culture, customers
and their preferences, etc.
– Example: Apple’s iPad in the touch-screen tablet market
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Apple Newton vs. Palm Pilot
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L ate M over Advantage
- Late (or second) mover advantage
– Be able to learn from the mistakes of the first mover – First mover may have established his brand that is difficult
to overcome
– Examples: Coca-Cola vs. Pepsi-Cola,
Pizza Hut vs. national chains (Thailand, M exico and others)
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Conclusion: Timingis an important Decision, how, when, and where to enter
But nobody can predict success. Do your research and learn from your customers.
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M odes of Entry – the ‘How’
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Factors of Entry M odes
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How would YOU start your new Energy Drink?
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L icensing
- Licensing includes franchising
– M ore committed than exporting – Higher profit potential – Less risky than direct investment – Example: Ramkhamhaeng University bags & neckties – Example: M arriot Hotels, Pizza Hut, CP-All, etc. – Franchise fee usually about 4 to 6 % of gross sales
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J
- int Venture and Direct Investment
- Joint venture is often a type of direct investment
- Learning curve reduced since local partner knows the
market
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