Lesson 20 Entering Into New Market

8/13/2019 Lesson 20 Entering Into New Market

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3or a %o$i(a or career, a goo( job )it% t%e $&"&ries in t%e a(vance( co&ntries In t%esi'i$ar )a o&r co'#anies a$so %ave to (eci(e )%et%er t%e )ant to sta (o'estic or goabroa( beca&se its not as si'#$e as o& ta+e a (ecision 3or o&rse$3 Most co'?2anies)o&$( #re3er to re'ain (o'estic i3 t%eir (o'estic 'ar+et )ere $arge eno&g% Managers)o&$( not nee( to $earn ot%er $ang&ages an( $a)s, (ea$ )it% vo$ati$e c&rrencies, 3ace

#o$itica$ an( $ega$ &ncertainties, or re(esign t%eir #ro(&cts to s&it (i33erent c&sto'ersnee(s an( e"#ectations 6&siness )o&$( be easier an( sa3er et severa$ 3actors are(ra)ing 'ore an( 'ore co'#anies into t%e internationa$ arena7 G$oba$ 3ir's o33ering

better #ro(&cts or $o)er #rices can attac+ t%e co'#an 4s (o'estic 'ar+et T%e co'#an'ig%t )ant to co&nterattac+ t%ese co'#etitors in t%eir %o'e 'ar+ets! T%e co'#an (iscovers t%at so'e 3oreign 'ar+ets #resent

INTERNATIONAL 6-SINESS MANAGEMENT

%ig%er #ro3it o##ort&nities t%an t%e (o'estic 'ar+et! T%e co'#an nee(4s a $arger c&sto'er base to ac%ieve

econo'ies o3 sca$e! T%e co'#an )ants to re(&ce its (e#en(ence on an one

'ar+et! T%e co'#an Cs c&sto'ers are going abroa( an( re>&ire

internationa$ servicing 6e3ore 'a+ing a (ecision to go abroa(, t%e co'#an '&st )eig%severa$ ris+s7 T%e co'#an 'ig%t not &n(erstan( 3oreign c&sto'er #re3erences an( 3ai$ too33er co'#etitive$ attractive #ro(&ct! T%e co'#an 'ig%t not &n(erstan( t%e 3oreign co&ntr 4s

b&siness c&$t&re or +no) %o) to (ea$ e33ective$ )it% 3oreign nations! T%e co'#an 'ig%t &n(eresti'ate 3oreign reg&$ations an(

inc&r &ne"#ecte( costs! T%e co'#an 'ig%t rea$i9e t%at it $ac+s 'anagers )it%

internationa$ e"#erience! T%e 3oreign co&ntr 'ig%t c%ange its co''ercia$ $a)s,

(eva$&e its c&rrenc , or &n(ergo a #o$itica$ revo$&tion an( e"#ro#riate 3oreign #ro#ert6eca&se o3 t%e co'#eting a(vantages an( ris+s, co'#anies o3ten (o not act &nti$ so'eevent t%r&sts t%e' into t%e internationa$ arena So'eone8 a (o'estic e"#orter, a 3oreign

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i'#orter, a 3oreign govern'ent8so$icits t%e co'#an to se$$ abroa(, or t%e co'#an issa(($e( )it% overca#acit an( '&st 3in( a((itiona$ 'ar+ets 3or its goo(s *eci(ing )%ic%'ar+ets to enter In (eci(ing to go abroa(, t%e co'#an nee(s to (e3ine its 'ar+etingobjectives an( #o$icies W%at #ro#ortion o3 3oreign to tota$ sa$es )i$$ it see+1 Mostco'#anies start s'a$$ )%en t%e vent&re abroa( So'e #$an to sta s'a$$7 ot%ers %ave

bigger #$ans ;Going abroa(< on t%e Internet #oses s#ecia$ c%a$$enges See ;Mar+eting3or t%e Ne) Econo' 7 ))) T%eWor$(s o&rO ster co' T%e Ins an( O&ts o3 G$oba$ E85o''erce < Mar+eting /or T%e Ne) Econo' ))) T%eWor$(s o&rO ster co' T%eIns an( O&ts o3 G$oba$ E85o''erce 5o'#anies s'a$$ an( $arge are ta+ing a(vantage o3t%e (isa##earance o3 tra(itiona$ 'ar+et bo&n(aries Major 'ar+eters (oing g$oba$ e8co''erce range 3ro' a&to'a+ers GM to (irect8'ai$ co'#anies LL 6ean an( Lan(s4En( to r&nning s%oe giants Ni+e an( Reebo+ to Internet start8s $i+e A'a9on co',)%ic% #&rc%ase( t%ree E&ro#ean co'#anies to b&i$( its E&ro#ean boo+ an( vi(eo sa$es/or so'e, 'ar+eting %as been a %it8or8'iss a33air T%e #&t content in Eng$is% 3or t%eA'erican 'ar+et, an( i3 na internationa$ &sers st&'b$e across t%e #age an( en(

b& ing so'et%ing, great H #ers#ace 5o)gir$s, a si"8 ear8o$( Ne) or+ 5it 8base(

(eve$o#er o3 c%i$(ren4s '&$ti'e(ia so3t)are, %as severa$ E&ro#ean (ea$s in t%e )or+s,even t%o&g% it %as no 'ar+eting e33ort overseas ;We (on4t a(vertise overseas at a$$, ;sa s S&san S%a), #resi(ent o3 t%e co'#an , )%ose Web a((ress is))) % #ers#aceco)gir$s co' < eo#$e j&st 3in( o&< Ot%er 'ar+eters %ave 'a(e astrategic (ecision to beco'e #art o3 t%e c ber ba9aar T%e are &sing t%e Web to reac%ne) c&sto'ers o&tsi(e t%eir %o'e co&ntries, to s#ort e"isting c&sto'ers )%o $iveabroa(, to so&rce 3ro' internationa$ s#$iers, an( to b&i$( g$oba$ bran( a)areness So'eo3 t%ese co'#anies a(a#t t%eir )eb sites to #rovi(e co&ntr 8s#eci3ic content an( servicesto t%eir best #otentia$ internationa$ 'ar+ets, i(ea$$ in t%e $oca$ $ang&age Reebo+ %as$a&nc%e( a '&$ti$ing&a$ E&ro#ean Web site8avai$ab$e in Eng$is%, /renc%, Ger'an,S#anis%, an( Ita$ian8 in an atte'#t to increase bran( a)areness in its in(ivi(&a$ 'ar+etsT%e site, $ocate( at ))) reebo+ co',is ai'e( at s#orts an( 3itness ent%&siasts an(inc$&(es in3or'ation on $oca$ events in eac% 'ar+et So no) o& +no) )% t%eseco'#anies are rate( n&'ber one in t%eir res#ective #ro(&cts or services 6e3oreco'#anies (eci(e to e"#an( t%eir Web #resence internationa$$ , t%e nee( to 3in( t%eco'#anies or regions )it% t%e $argest #otentia$ on$ine #o#&$ation T%e biggest area 3orgro)t% to(a )o&$( be t%e Asia8 aci3ic region T%e n&'ber o3 Internet &sers in t%eregion is raising as access costs (ec$ine, $oca$$ang&age content increases, an(in3rastr&ct&re i'#roves 6 200@, t%e n&'ber o3 Internet &sers in t%e Asia8 aci3ic region&s e"#ecte( to s)e$$ to ?JJ 'i$$ion E&ro#e is anot%er %ots#ot 3or Internet gro)t%Internet #enetration in E&ro#e is e"#ecte( to rise to FF #ercent b 200F 6 t%en, t%e 3iveco&ntries )it% t%e %ig%est $eve$s o3 Internet #enetration8Ger'an , /rance, t%e

Net%er$an(s, t%e &nite( King(o', an( S)e(en8)i$$ %ave on$ine #o#&$ations tota$ing 0'i$$ion in ? *es#ite t%ese enco&raging (eve$o#'ents, %o)ever, Internet 'ar+etsso'eti'es overstate g$oba$ o##ort&nities A$t%o&g% (eve$o#e( co&ntries o33er 'anc%oices 3or Internet access, $ess (eve$o#e( co&ntries in 5entra$ an( So&t% A'erica orA3rica %ave 3e)er or none at a$$, 3orcing &sers to 'a+e internationa$ ca$$s to go on$ineOn$ #ercent o3 t%e )or$(4s #o#&$ation %a( Internet access in 2000 Even )it% a(e>&ate

#%one $ines an( 5 #enetration, %ig% connection costs s%ar#$ restrict Internet &se In


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Asia, IS s&bscri#tions can r&n to B 0a 'ont%, tri#$e t%e average - S rate Ina((ition, t%e g$oba$ 'ar+eter 'a r&n against govern'enta$ or c&$t&ra$ restrictions, InGer'an , a ven(or cannot acce#t #a 'ent via cre(it car( &nti$ t)o )ee+s a3ter an or(er%as been sent Ger'an $a) a$so #revents co'#anies 3ro' &sing certain 'ar+etingtec%ni>&es $i+e &ncon(itiona$ $i3eti'e g&arantees On a )i(er sca$e, t%e iss&e o3 )%o #a s

sa$es ta"es an( (&ties on g$oba$ e8co''erce is '&r+ier sti$$ /ina$$ , o& 'a %ave&n(erstoo( t%at b&siness nee(s to rea$i9e t%at t%e )eb (oes not o33er co'#$ete so$&tions3or transacting g$oba$ b&siness8an( #robab$ never )i$$ Most co'#anies )i$$ never c&t a3ina$ (ea$ via e8'ai$ eo#$e )i$$ sti$$ nee( to see an( 3ee$ #ro(&cts at internationa$ tra(es%o)s T%e Web )i$$ not s&r'o&nt c&sto's re( ta#e or $oca$ reg&$ation T%e Web a$socannot g&arantee t%at goo(s )i$$ arrive in #er3ect con(ition W%at t%e Web can (o is'a+e 3oreign c&sto'ers a)are o3 one4s b&siness T%e )eb %as certain$ (one t%at 3orsca$e retai$er an( cata$oger T%e s%ar#er I'age, )%ic% no) gets 'ore t%an 2. #ercento3 its on$ine b&siness 3ro' overseas c&sto'ers T%e co'#an is t%ri$$e( abo&t its g$oba$

#ros#ects b&t a('its it is sti$$ over)%e$'e( b t%e $ogistica$ c%a$$enges o3 servingoverseas 'ar+ets Ho) Man Mar+ets to Enter No) o& s%o&$( +no) t%at once t%e

co'#an %as (eci(e( to enter t%e internationa$ 'ar+et t%e ne"t (ecision (e#en(ing on t%eres#onse is %o) 'an 'ar+ets to enter, o& s%o&$( +no) t%is is (i33ic&$t beca&se i3 o&go to a ne) resta&rant 3or a 'ea$ o& ten( to get con3&se( in 'a+ing a (ecision o3 )%atto %ave rig%t 3ro' (eci(ing t%e c&isine $i+e In(ian, orienta$ or continenta$, )% 1 6eca&se

o& (on4t +no) )%at )o&$( be t%eir s#ecia$i9ation or )o&$( it be to o&r $i+ing, rig%t1T%e co'#an '&st (eci(e )%et%er to 'ar+et in a 3e) co&ntries or 'an co&ntries an((eter'ine %o) 3ast to e"#an( 5onsi(er 6oo co' 6oo' co' W%en on$ine retai$er6oo co' )as 3o&n(e( in ? J, t%e co'#an e"#resse( t%e a'bitio&s goa$ o3 beco'ingt%e ;3irst tr&$ g$oba$8e8tai$er, )it% )or$(8)i(e sa$es, 'ar+eting an( (istrib&tionca#abi$ities ;T%e bo$( #$an attracte( n&'ero&s investors, an( t%e co'#an raise( B?F.'i$$ion in vent&re ca#ita$ t%at it &se( to b&i$( %ig%8tec% e8co''erce sites in seven$ang&ages in ?J co&ntries 6oo co' constr&cte( sate$$ite o33ices in si" cities, inc$&(ingM&nic%, aris, an( Ne) or+ A3ter 'ont%s o3 (e$a s, t%e site )ent $ive in Nove'ber2000 an( )as i''e(iate$ critici9e( 3or an inter3ace t%at )as too co'#$icate( an(con3&sing Mont%$ sa$es o3 B? ? 'i$$ion 'ont% co&$( not


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'a+e 3or 'o&nting e"#enses, )%ic% ran to an esti'ate( B? 'i$$ion a )ee+ b Ma2000 In =&ne o3 t%at ear, A'erican eretai$er 3as%ion'a$$ co' #&rc%ase( t%e co'#an at$i>&i(ation a&ction 3or $ess t%an B.00,000 In 5ontrast, 5onsi(er A')a 4s E"#erienceA')a 5ons&'er8#ro(&ct 5o'#an A')a e"#an(e( into A&stra$ia in ? ? In t%e? J0s, A')a 'ove( into ?0 'ore co&ntries 6 ? , A')a %a( evo$ve( into a

'&$tinationa$ j&ggerna&t )it% a sa$es 3orce o3 'ore t%an F 'i$$ion in(e#en(ent(istrib&tors %a&$ing in B. bi$$ion in sa$es To(a , A')a se$$s #ro(&cts in @F co&ntries)or$()i(e Its goa$ to %ave overseas 'ar+ets acco&nt 3or J0 #ercent o3 its sa$es T%is isnot an &nrea$istic or over$ a'bitio&s goa$ consi(ering t%at A')a a$rea( gains 0

#ercent o3 its sa$es 3ro' 'ar+ets o&tsi(e Nort% A'erica Genera$$ s#ea+ing, it 'a+essense to o#erate in 3e)er co&ntries )it% a (ee#er co''it'ent an( #enetration in eac%A a$ an( i3 %ave arg&e( t%at a co'#an s%o&$( enter 3e)er co&ntries )%en! Mar+et entr an( 'ar+et contro$ costs are %ig% ! ro(&ct an( co''&nicationa(a#tation costs are %ig% ! o#&$ation an( inco'e si9e an( gro)t% are %ig% in t%e

E&ro#e #ossess an eager, %&ngr 8to8Learn $abo&r #oo$, t%eir in3rastr&ct&res create

(i33ic&$ties T%e tea' eva$&ating a ne) 'ar+et '&st (eter'ine )%et%er t%e co'#anco&$( earn eno&g% on its invest'ent to cover t%e ris+ 3actors or ot%er negatives /or aneg$ecte( area o3 g$oba$ 'ar+et o##ort&nit , see ;Mar+eting Me'o Going A3ter oorMar+ets Aro&n( t%e G$obe< *eci(ing Ho) To Enter T%e Mar+et So $ets contin&e )it%t%e #revio&s e"a'#$e o3 t%e resta&rant $i+e c%oosing t%e 'ea$, ne"t >&estion )o&$( be)%at )i$$ be re>&ire( 0 eat t%e 3oo( )it% c%o#stic+s1 Or +ni3e an( 3or+ an( s#oon or 3ine)it% %an(s1 T%at4s %o) (o I eat it1 Si'i$ar$ once a co'#an (eci(es to target a

#artic&$ar co&ntr , it %as to (eter'ine t%e best 'o(e o3 entr Its broa( c%oices arein(irect e"#orting, (irect e"#orting, $icensing, joint vent&res, an( (irect invest'entT%ese 3ive 'ar+et8entr strategies invo$ve 'ore co''it'ent, ris+, contro$, an( #ro3it

#otentia$ In(irect an( *irect E"#ort T%e nor'a$ )a to get invo$ve( in a 3oreign 'ar+etis t%ro&g% e"#ort Occasiona$ e"#orting is a #assive $eve$ o3 invo$ve'ent in )%ic% t%eco'#an e"#orts 3ro' ti'e to ti'e, eit%er on its o)n initiative or in res#onse to&nso$icite( or(ers 3ro' abroa( Active e"#orting ta+es #$ace )%en t%e co'#an 'a+es aco''it'ent to e"#an( into a #artic&$ar 'ar+et In eit%er case, t%e co'#an #ro(&ces itsgoo(s in t%e %o'e co&ntr an( 'ig%t or 'ig%t not a(a#t t%e' to t%e 3oreign 'ar+et5o'#anies t #ica$$ start )it% in(irect e"#orting8t%at is, t%e )or+ t%ro&g% in(e#en(entinter'e(iaries *o'estic8base( e"#ort 'erc%ants b& t%e 'an&3act&rer4s #ro(&cts an(t%en se$$ t%e' abroa( *o'estic8base( e"#ort agents see+ an( negotiate 3oreign

#&rc%ases an( are #ai( a co''ission Inc$&(e( in t%is gro are tra(ing co'#anies5oo#erative organi9ations carr on e"#orting activities on be%a$3 o3 severa$ #ro(&cers an(are #art$ &n(er t%eir a('inistrative contro$ T%e are o3ten &se( b #ro(&cers o3 #ri'ar

#ro(&cts s&c% as 3r&its or n&ts E"#ort'anage'ent co'#anies agree to 'anage aco'#an 4s e"#ort activities 3or a 3ree In(irect e"#ort %as t)o a(vantages /irst, itinvo$ves $ess invest'ent7 t%e 3ir' (oes n t%ave to (eve$o# an e"#ort (e#art'ent, anoverseas sa$es 3orce, or a set o3 3oreign contracts Secon(, it invo$ves $ess ris+7 beca&seinternationa$'ar+eting inter'e(iaries bring +no)8%o) an( services to re$ations%i#, t%ese$$er )i$$ nor'a$$ 'a+e 3e)er 'ista+es 5o'#anies event&a$$ 'a (eci(e to %an($et%eir o)n e"#orts T%e invest'ent an( ris+ are so'e)%at greater, b&t so is t%e #otentia$ret&rn -niversit Ga'es o3 6&r$inga'e, 5a$i3ornia, %as b$osso'e( into a B.08'i$$ion8


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#er 8 ear internationa$ co'#an t%ro&g% care3&$ entr into overseas vent&res -niversitGa'es 6ob Moog, #resi(ent an( 3o&n(er o3 -niversit Ga'es, sa s %is co'#an 4sinternationa$ sa$es strateg re$ies %eavi$ on t%ir(8#art (istrib&tors an( %as a 3air (egreeo3 3$e"ibi$it ;We i(enti3 t%e 3oreign 'ar+ets )e )ant to #enetrate


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contracting vent&re )it% a $oca$ 'an&3act&rer in A&stra$ia or Ne) ea$an( to #rint t%ega'es< I a' giving to o& %o) t%e co'#an can can on (irect e"#orting in severa$)a s! *o'estic8base( e"#ort (e#art'ent or (ivision Mig%t

evo$ve into a se$38containe( e"#ort (e#art'ent o#erating as a #ro3it center! Overseas sa$es branc% or s&bsi(iar T%e sa$es branc% %an($es

sa$es an( (istrib&tion an( 'ig%t %an($e )are%o&sing an( #ro'otion as )e$$ It o3tenserves as a (is#$a an( c&sto'er service center! Trave$ing e"#ort sa$es re#resentatives Ho'e8base( sa es

$icensor $icenses a 3oreign co'#an to &se a 'an&3act&ring #rocess, tra(e'ar+, #atent,tra(e secret, or ot%er ite' o3 va$&e 3or a 3ee or ro a$t T%e $icensor gains entr at $itt$eris+7 t%e $icensee gains #ro(&ction e"#ertise or a )e$$8+no)n #ro(&ct or bran( na'e E8Tra(e Gro, t%e a$o A$to, 5a$i3ornia, on$ine bro+er8(ea$er, entere( into a $icensing

agree'ent )it% =er&sa$e' G$oba$ Lt( , an Israe$i invest'ent ban+ing o#eration E8Tra(e4s agree'ent )it% t%e Israe$i 3ir' is #art o3 a strateg to 3or' $icensing agree'entsan( internationa$ joint vent&res in an e33ort to bring its bran( o3 no83ri$$s investing to

#eo#$e abroa( E8 Tra(e %as create( E8 Tra(e A&stra$ia, 5ana(a, *en'ar+, Ger'an ,Hong Kong, =a#an, Korea, Nor)a , So&t% A3rica, S)e(en, an( - K Licensing %as

#otentia$ (isa(vantages T%e $icensor %as $ess contro$ over t%e $icensee t%an it (oes overits o)n #ro(&ction an( sa$es 3aci$ities /&rt%er'ore, i3 t%e $icensee is ver s&ccess3&$, t%e3ir' %as given #ro3its7 an( i3 an( )%en t%e contract en(s, t%e co'#an 'ig%t 3in( t%atit %as create( a co'#etitor To avoi( t%is, t%e $icensor &s&a$$ s#$ies so'e #ro#rietaringre(ients or co'#onents nee(e( in t%e #ro(&ct as 5oca85o$a (oes 7 b&t t%e beststrateg is 3or t%e $icensor to $ea( in innovation so t%at t%e $icensee )i$$ contin&e to(e#en( on t%e $icensor T%ere are severa$ variations on a $icensing arrange'ent5o'#anies s&c% as H att an( Marriott se$$ 'anage'ent contracts to o)ners o3 3oreign%ote$s to 'anage t%ese b&sinesses 3or a 3ree T%e 'anage'ent 3ir' 'a even be givent%e o#tion to #&rc%ase so'e s%are in t%e 'anage( co'#an )it%in a state( #erio(Anot%er variation is contract 'an&3act&ring, in )%ic% t%e 3ir' %ires $oca$ 'an&3act&rersto #ro(&ce t%e #ro(&ct W%en Sears o#ene( (e#art'ent stores in Me"ico an( S#ain, it3o&n( >&a$i3ie( $oca$ 'an&3act&rers to #ro(&ce 'an o3 its #ro(&cts 5ontract'an&3act&ring gives t%e co'#an $ess contro$ over t%e 'an&3act&ring #rocess an( t%e$oss o3 #otentia$ #ro3its on 'an&3act&ring Ho)ever, it o33ers a c%ance to start 3aster, )it%$ess ris+ an( )it% t%e o##ort&nit to 3or' a #artners%i# or b& o&t t%e $oca$ 'an&3act&rer$ater /ina$$ , a co'#an can enter a 3oreign 'ar+et t%ro&g% 3ranc%ising, )%ic% is 'oreco'#$ete 3or' o3 $icensing T%e 3ranc%iser o33ers a co'#$ete bran( conce#t an(o#erating, s ste' In ret&rn, t%e 3ranc%isee invests in an( #a s certain 3ees to t%e3ranc%iser Mc*ona$(4s, K/5, an( Avis %ave entere( scores o3 co&ntries b 3ranc%isingt%eir retai$ conce#ts K/5 5OR ORATION a$t%o&g% t%e initia$ rece#tion in =a#an )asgreat, K/5 sti$$ %a( a n&'ber o3 obstac$es to overco'e T%e =a#anese sa) 3ast 3oo( asarti3icia$, 'a(e b 'ec%anica$ 'eans, an( &n%ea$t% K/54s a( agenc in =a#an,Mc5annEric+son =a#an, +ne) t%at it %a( to b&i$( tr&st in t%e K/5 bran( Agenc

#ersonne$ 3$e) to Kent&c+ to 3i$' an a&t%entic version o3 5o$one$ San(ers4 beginnings


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To s%o) t%e #%i$oso#% o3 K/58t%e so&t%ern %os#ita$it , o$( A'erican tra(ition, an(a&t%entic %o'e coo+ing8t%e co''ercia$ s%o)e( 5o$one$ San(ers4 'ot%er 'a+ing an(3ee(ing %er c%i$(ren K/5 c%ic+en 'a(e )it% ?? secret s#ices It conve e( t%e 3act t%at;K/5 c%ic+en is not arti3icia$ It4s 'a(e b %an(, an( goo( eno&g% 3or o&r c%i$(ren toeat, ;T%e ca'#aign )as %&ge$ s&ccess3&$, an(


re#resentatives are sent abroa( to 3in( b&siness ! /oreign8base( (istrib&tors or agentsT%ese (istrib&tors an( agents 'ig%t be given e"c$&sive rig%ts to re#resent t%e co'#an int%at co&ntr , or on$ $i'ite( rig%ts W%et%er co'#anies (eci(e to e"#ort in(irect$ or(irect$ , 'an co'#anies &se e"#orting as a )a to ;test t%e )aters< be3ore b&i$(ing a

#$ant an( 'an&3act&ring a #ro(&ct overseas T%is strateg )or+e( )e$$ 3or I S5O, Inc Int%e ear$ ? J0s T%is Sas+atc%e)an8base( stee$ #ro(&cer e"#orte( its stee$ #i#e an( 3$atstee$ to t%e -nite( States 3ro' 5ana(a8(es#ite signi3icant trans#ortation costs Once t%eco'#an rea$i9e( t%ere )as a signi3icant -PS (e'an( 3or its #ro(&cts7 it (eci(e( to set

s%o# t%ere One o3 t%e best )a s to initiate or e"ten( e"#ort activities &se( to be toe"%ibit at an overseas tra(e s%o) Wit% t%e Wor$( Wi(e Web, it is not even necessar toatten( tra(e s%o)s one4s )ares to overseas b& ers an( (istrib&tors E$ectronicco''&nication via t%e Internet is e"ten(ing t%e reac% o3 co'#anies, #artic&$ar$ s'a$$ones, to )or$()i(e 'ar+ets T%e Internet %as beco'e an e33ective 'eans o3 ever t%ing3ro' gaining 3ree e"#orting in3or'ation an( g&i(e$ines, con(&cting 'ar+et researc%, an(o33ering c&sto'ers severa$ ti'e 9ones a)a a sec&re #rocess 3or or(ering an( #a ing 3or

#ro(&cts /in(ing 3ree in3or'ation abo&t tra(e an( e"#orting %as never been easier Hereare so'e #$aces to start o&r searc% ))) its (oc gov t%e - S *e#art'ent o35o''erce4s Internationa$ Tra(e A('inistration ))) e"i' gov t%e E"#ort8I'#ort6an+ O3 t%e -nite( States ))) sba gov t%e - S S'a$$ 6&siness A('inistration))) b"a (oc gov t%e 6&rea& o3 E"#ort A('inistration, a branc% o3 t%e 5o''erce*e#art'ent )) tscentra$ co' Tra(e S%o) 5entra$, a We$$es$e , Massac%&setts,co'#an A$so, c%ec+ )it% o&r state4s e"#ort8#ro'otion o33ice to $earn i3 it %as on$inereso&rces an( a$$o)s b&siness to $in+ to its site T%en c%ec+ ;Mar+eting Me'o Ma+ing

o&r Web Site Wor$()i(e an( Wor$($ Wise< 3or ti#s on Web sites t%at attract, rat%ert%an 3r&strate, overseas c&sto'ers Licensing o& nee( a $icense 3or (riving a t)o8)%ee$er, or +ee#ing a #isto$ 3or o&r sa3et , or a #ass#ort an( visa to trave$ b air abroa(,an( )it%o&t t%is $icense a$$ t%ese t%ings are consi(ere( i$$ega$ an( o& can be convicte(

b t%e co&rt o3 $a) Licensing is a si'#$e )a to beco'e invo$ve( in internationa$'ar+eting T%e?


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in $ess t%an J ears K/5 e"#an(e( its #resence 3ro' @00 $ocations to 'ore t%an ?,000=oint ent&res /oreign investors 'a join )it% $oca$ investors to create a joint vent&reco'#an in )%ic% t%e s%are o)ners%i# an( contro$ /or instance7! 5oca85o$a an( Nest$e joine( 3orces to (eve$o# t%e

T%e 'an (isa(vantage o3 (irect invest'ent is t%at t%e 3ir' e"#oses a $arge invest'ent toris+s s&c% as b$oc+e( or (eva$&e( c&rrencies, )orsening 'ar+ets, or e"#ro#riation T%e3ir' )i$$ 3in( it e"#ensive to re(&ce or c$ose (o)n its o#erations, beca&se t%e %ostco&ntr 'ig%t re>&ire s&bstantia$ severance #a to t%e e'#$o ees Strategi9ing o&r Ne"tMove in T%e G$oba$ Ga'e Are o& $oo+ing 3or )a s to 3in( ne) 'ar+ets an( c&sto'ers15o'#anies to(a rea$i9e 'ar+eting t%eir bran( an( se$$ing t%eir o33erings on$ in t%e-nite( States is beco'ing even 'ore c%a$$enging 6&sinesses are 3acing 3iercerco'#etition, s'a$$er c&sto'er seg'ents res&$ting 3ro' cor#orate (o)nsi9ing or

b&sinesses c$osing t%eir (oors, as )e$$ as t%e c%ange in cons&'er8b& ing be%aviors3&e$e( b an &n#re(ictab$e econo' A$$ t #es an( si9es o3 co'#anies in a variet o3in(&stries are 3in(ing &n(erta+ing a g$oba$ a##roac% is i'#erative i3 t%e #$an to +ee#

t%eir co'#etitive e(ge an( sec&re t%eir 3&t&re s&rviva$ 6eco'ing a g$oba$ #$a er is even'ore o3 a necessit to(a *oing it )e$$ is critica$ to %e$# ens&re a s'oot% entr into ne)'ar+et#$aces8an( being 3&$$ #re#are( to ;go g$oba$< is essentia$ to ens&ring $ong8ter's&ccess an( 'eeting ret&rn on invest'ent ROI e"#ectations To (o it rig%t, b&sinessesto(a %ave to be co''itte( to s#en(ing t%e >&a$it ti'e nee(e( to strategi9e an( testt%eir g$oba$ ga'e #$an Too o3ten )e %ear, ;I %ave a g$oba$ #resence T%e co'#an 4sco''&nication 'ateria$s an( ve%ic$es are trans$ate( to s#ea+ to o&r internationa$a&(iences < -n3ort&nate$ , trans$ating one4s Web site or #rint 'ateria$s into (i33erent$ang&ages isn4t t%e on$ re>&ire'ent to ens&ring o&r b&siness is rea( to ;go g$oba$ &ire joint o)ners%i# as a con(ition 3or entr Evencor#orate giants nee( joint vent&res to crac+ t%e to&g%est 'ar+ets W%en it )ante( toenter 5%ina4s ice crea' 'ar+et, -ni$ever joine( 3orces )it% S&'star, a stateo)ne(5%inese invest'ent co'#an T%e vent&re4s genera$ 'anager sa s S&'star4s %e$# )it%t%e 3or'i(ab$e 5%inese b&rea&crac )as cr&cia$ in getting a %ig%8tec% ice crea' #$ant


10/14

an( r&nning in j&st ?2 'ont%s =oint o)ners%i# %as certain (ra)bac+s T%e #artners'ig%t (isagree over invest'ent, 'ar+eting, or ot%er #o$icies One #artner 'ig%t )ant toreinvest earnings 3or gro)t%, an( t%e ot%er #artner 'ig%t )ant to (ec$are 'ore (ivi(en(s=oint o)ners%i# can a$so #revent a '&$tinationa$ co'#an 3ro' carr ing o&t s#eci3ic'an&3act&ring an( 'ar+eting #o$icies on a )or$()i(e basis *irect Invest'ent o& '&st

%ave seen o&r #arents investing 3or o&r an( t%eir sa3e an( sec&re 3&t&re, as o& 3ear aninsec&re 3&t&re7 si'i$ar$ co'#anies a$so %ave to invest 3or sec&rit an( s&stenance T%e&$ti'ate 3or' o3 3oreign invo$ve'ent is (irect o)ners%i# o3 3oreign8base( asse'b$ or'an&3act&ring 3aci$ities T%e 3oreign co'#an can b& #art or 3&$$ interest in a $oca$co'#an or b&i$(s its o)n 3aci$ities I3 t%e TI?ar+et a##ears $arge eno&g%, 3oreign

#ro(&ction 3aci$ities o33er (istinct a(vantages /irst, t%e 3ir' sec&res cost econo'ies int%e 3or' o3 c%ea#er $abor or ra) 'ateria$s, 3oreign8govern'ent invest'ent incentives,an( 3reig%t savings Secon(, t%e 3ir' strengt%ens its i'age in t%e %ose co&ntr beca&se itcreates jobs T%ir(, t%e 3ir' (eve$o#s a (ee#er re$ations%i# )it% govern'ent, c&sto'ers,$oca$ s#$iers, an( (istrib&tors, enab$ing it to a(a#t its #ro(&cts better to t%e $oca$environ'ent /o&rt%, t%e 3ir' retains 3&$$ contro$ over its invest'ent an( t%ere3ore can

(eve$o# 'an&3act&ring an( 'ar+eting #o$icies t%at serve its $ong8ter' internationa$objectives /i3t%, t%e 3ir' ass&res itse$3 access to t%e 'ar+et in case t%e %ose co&ntrstarts insisting t%at $oca$$ #&rc%ase( goo(s %ave (o'estic content

service to ne) c&sto'er 'ar+ets! A(%ere to t%e 'ar+et4s nee(s an( (e'an(s ! Estab$is% o&r bran( as a g$oba$ #$a ergiving o&r b&siness

t%e co'#etitive a(vantage o& 'a begin to as+, ;W%at are t%e rig%t >&estions to as+ to be s&re )e are #re#are( an( ca#ab$e at t%is ti'e to go g$oba$14< Or, ;W%at i3 it (oesn4t)or+1< Kee# in 'in( o& (on4t %ave to tac+$e a$$ 'ar+ets at once *eve$o# a #i$ot

#rogra'83oc&s on one 'ar+et at a ti'e &ti$i9ing an( $everaging )%at o& $earne( in #rior'ar+et e"#ansion #ractices to %e$# en%ance an( strengt%en ne) 'ar+et entries T%e #i$ota##roac% )i$$ a$so %e$# to gra(&a$$ ease o&r sta33 into t%eir ne) ro$es in t%e g$oba$'ar+et#$ace

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Here are so'e >&estions to begin )it% to %e$# (eter'ine i3 an( )%en o&r co'#an )i$$ be rea( to enter t%e g$oba$ 'ar+et#$ace an( )%at is nee(e( to (o so ? Is t%e cor#orate$ea(ers%i# co''itte( an( invo$ve( in going g$oba$1 2 W%o s%o&$( be invo$ve( in o&rg$oba$ ga'e #$an an( strategi9ing sessions1 W%at are t%eir s#eci3ic ro$es an(res#onsibi$ities1 F Have )e (one an 'ar+et researc% to (eter'ine W%at g$oba$ 'ar+ets

%ave a (e'an( 3or o&r o33ering1 W%o )o&$( )e co'#ete )it% in eac% 'ar+et8%o) are)e t%e sa'e an( (i33erent1 *oes o&r o33ering #ro(&ctsCservices %ave to be restr&ct&re(or reb&i$t to inc$&(e s#eci3ic 3eat&res an( o#tions1 @ W%at (o )e antici#ate in o#erationscost increases1 *oes t%e reven&e #otentia$ in t%at 'ar+et s#ort t%at increase1 . *oeso&r enter#rise s ste' %ave t%e ca#abi$it to s#ort '&$ti#$e $ang&ages an( c&rrencies1 S%o&$( )e ac>&ire 3oreign co'#anies or #artner )it% e"isting b&sinesses in t%e $oca$'ar+ets to s#ort e"#ansion strategies1 Or s%o&$( )e b&i$( o&r o)n o#erations1 W%ato#erations s%o&$( be $oca$ an( )%ic% ones s%o&$( not1 J As )e contin&e to enter ne)'ar+ets, %o) )i$$ )e integrate t%e' into t%e overa$$ 'ar+eting an( co''&nicationsstrateg as )e$$ as t%ose o#erations an( #rocesses a$rea( in #$ace1 Wi$$ )e nee(a((itiona$ sta33 to #rovi(e $ang&age e"#ertise b 'ar+et, c&$t&ra$ an( geogra#%ica$

&n(erstan(ing, $ega$ s#ort, etc 1 S%o&$( t%is sta33 be $oca$i9e( in t%e areas )e (o b&siness in1 Or s%o&$( )e consi(er o&tso&rcing to t%ose )%o o33er services to s#ort o&rnee(s in +e 'ar+ets8i e , '&$ti$ing&a$ contact centers to #rovi(e c&sto'er s#ort or)are%o&sing 3or 3&$3i$$'ent an( s%i##ing1 ?0 Once o&r g$oba$ ga'e #$an is 3ina$i9e(,%o) (o )e intro(&ce it to t%e entire organi9ation to generate e"cite'ent, o)ners%i#,acco&ntabi$it an( ent%&sias'1 W%at 'ar+eting an( co''&nication e33orts s%o&$( )e3oc&s on to $a&nc% o&r ne) cor#orate internationa$ 'ission to o&r c&sto'ers an( #artners8s%o&$( )e 3oc&s (o'estica$$ an(Cor g$oba$$ 1 I3 o&r organi9ation is a #&re (ot8co' oris intereste( in ;$oca$i9ing< its Web site #resence to s#ort e33orts in ne) 'ar+ets, t%ena$so as+ o&rse$3 t%ese t #es o3 >&estions I Are t%e 'ar+ets )e are targeting e>&i##e(3or Web connectivit 1 2 Have )e (one o&r %o'e)or+ #rior to ;b&i$(ing o&r on$ine

#resence< to co'#$ete$ &n(erstan( o&r target 'ar+et an( its $oca$ c&sto'ers1 *o )erea$$ +no) %o) o&r on$ine a&(ience be%aves, )%at t%eir s%o##ing traits are $i+e, )%at

#a 'ent 'et%o(s t%e &se, )%at sort o3 in3or'ation t%e nee( to 'a+e a #&rc%ase an(%o) (o t%e )ant t%at #resente( to t%e'1 F Have )e $oca$i9e( o&r site gra#%ics, contentan( navigationa$ str&ct&re to s#ort t%e target a&(ience an( t%eir c&$t&ra$ #re3erences1*oes o&r bran( i'age $ogo an( cor#orate? J

'essage 'a+e sense to o&r target 'ar+ets1 Are o&r cor#orate co$ors or content )or(ingc&$t&ra$$ o33ensive in an )a 1 @ W%o )i$$ 'anage t%e content on t%e site8(ating,acc&rac , 'essaging, etc 1 *o )e %ave a >&a$i3ie( #artner to %e$# &s trans$ate a$$ o&r Webcontent1 *oes t%e #artner %ave $oca$ trans$ators in co&ntr to (o t%e trans$ation1 W%at

#ortion o3 t%e site an( its content s%o&$( be trans$ate(1 S%o&$( t%e content be trans$ate(verbati' to )%at )e sa in o&r $oca$ $ang&age, or s%o&$( )e re)rite #ortions o3 it to

better co''&nicate to o&r target a&(ience1 . W%o )i$$ 'anage t%e site4s #er3or'ance,(ai$ 3&nctiona$it c%a$$enges, IT, etc 1 W%at criteria )i$$ be &se( to 'eas&re t%es&ccess Ret&rn On Invest'ent o3 o&r g$oba$ e"#ansion on$ine1 *oes o&r e8co''ercesite s#ort t%e $oca$8'ar+et c&rrenc C conversion 3re>&enc , #a 'ent 'et%o(s, ta"es,tari33s, ATs, $ang&age, $ogistics, s#$ c%ain 3&$3i$$'ent, c&sto'er service an( s#ort,


12/14

(istrib&tion c%anne$s, $ega$ #ractices, etc *o )e %ave tec%no$og to %an($e '&$ti$ing&a$e'ai$ in>&iries, acco&nting an( #a 'ent nee(s, etc 1 J S%o&$( )e 3orge #artners%i#s)it% in(ivi(&a$ ban+s to %an($e o&r on$ine transactions or )it% a ;#a 'ent %&b< t%ata$rea( %o$(s re$ations%i#s )it% ban+s in s#eci3ic 'ar+ets1 *o )e %ave a $ogistics

#artner s )%o &n(erstan(s g$oba$ s%i##ing an( %an($ing re>&ire'ents base( on o&r

)are%o&ses an( s%i#8to 'ar+ets1 W%i$e it is i'#erative 3or b&sinesses $oo+ing to e"#an(t%eir o33erings to ne) 'ar+ets an( c&sto'er seg'ents to gain 3oot%o$( in t%ese 'ar+ets, be)are o3 t%e '&st b&i$(4 'enta$it Ta+e t%e ti'e to as+ t%e >&estions an( c%a$$enge

o&r e"isting b&siness strategies an( #ractices be3ore ta+ing o&r b&siness to ne)3rontiers o& %ave one c%ance to 'a+e a #ositive i'#ression, no 'atter )%at 'ar+et o&are in ?0 Traits T%at &t o& on To# o3 t%e Wor$( In to(a 4s t&rb&$ent g$oba$ b&sinessenviron'ent, t%ere is no better ti'e t%an no) to #&t e33ective g$oba$ $ea(ers%i# traits into

#$ace W%at are t%ose traits1 Here are ' to#8ten 3avorites base( on over ?. ears o3e"#erience in r&nning a g$oba$ enter#rise ? S'arts o& (on4t nee( Iv Leag&ecre(entia$s 5o''onsense b&siness j&(g'ent an( a 3air (egree o3 e'otiona$ inte$$igence)i$$ %e$# o& navigate 'ost sit&ations An( be goo( at $earning #rocessing $ots o3

in3or'ation, ana$ 9ing (ata an( 3orever re3ining o&r vision is a '&st )%en o&4re in&n3a'i$iar territor 2 Motivation o&4ve got to be a se$38starter W%en o&4re carvingo&t o&r o)n #at%, o& can4t e"#ect ro&n(8t%e8c$oc+ servision an( g&i(ance *on4tre$ on an one e"ce#t o&rse$3 to get o& going 8 o& '&st get o& going F InitiativeT%e 'ore a'bitio&s an( innovative o& are, t%e greater t%e nee( to ta+e an ins#ire(action an( 'a+e so'et%ing %a##en ic+ t%e #%one, sen( e8'ai$, j&'# in o&r car, as+a >&estion, 'a+e a contact, an( 'a+e an o33er &t a #rocess in 'otion an( rea# t%ere)ar(s



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@ En($ess energ R&n aro&n( t%e b$oc+ )%ere o& $ive an( see %o) tire( o& get W%eno&4re a g$oba$ $ea(er, o&4$$ be %it )it% t%e e>&iva$ent o3 t%at r&n aro&n( t%e b$oc+ at

$east a %&n(re( ti'es (a , an( o&4$$ %ave to (ea$ )it% it, tire( or not An( )%en o& (oc$ose o&r e es to s$ee#, #&t t%at ti'e to )or+ 8 as+ o&r creative &nconscio&s )%at o&s%o&$( (o or )%ere o& s%o&$( go ne"t En($ess energ gets o& #$aces . erseverance

Kee#ing t%e str&gg$e )%en t%ere4s no tangib$e bene3it in sig%t nor an sign o3 $ig%t att%e en( o3 t%e t&nne$ ta+es #erseverance Kee# at it Even i3 o& (on4t $i+e t%e 3ina$ res&$t,at $east o&4ve #ro(&ce( so'et%ing 8 an( o& can a$)a s ta+e it 3ro' t%ere an( i'#rove

I'aginative sco#e T%ere are i($e (a (rea'ers T%ere are #eo#$e )it% (e$&sions o3gran(e&r An( t%en t%ere are g$oba$ $ea(ers, )%o are ca#ab$e o3 co'bining a vision o3 t%esee'ing$ i'#ossib$e )it% a #$an to 'a+e it %a##en ositive attit&(e /oc&sing on t%egoo( in an sit&ation (oesn4t 'ean o&4re naive It 'eans o& (o not )ant to )aste o&rti'e on negative t%in+ing Ta+ing t%e constr&ctive a##roac% seeing )%at o&r o#tionsan( reso&rces are, an( 'a+ing &se o3 t%e' 8 )i$$ a$)a s get o& so'e)%ere J atienceInternationa$ #&rs&its ta+e ti'e to (eve$o# Kno)ing )%en to re'ain ca$' an( %ang int%ere )i$$ increase o&r c%ances 3or g$oba$ s&ccess T%e 3o&r 54 s 5o&rage

5on3i(ence 5onviction 5o''&nication 5o&rage 8 o& '&st 3ace #ain3&$ iss&es, o&'&st con>&er o&r 3ears, an( o& '&st con3ront a(versit %ea(8on in or(er to gro)Moving 3or)ar( at an #ace )%en o&4re (ea$ing )it% t%e &n+no)n ta+es co&rage A##$it in ever t%ing o& (o 5on3i(ence 8 Even i3 o& (on4t +no) )%at o&4re (oing, act as i3

o& (o, an( soon o&4$$ be convince( 5on3i(ence co'es 3ro' +no)ing t%at o& are incontro$ o3 o&rse$3, no 'atter )%at %a##ens to o& 5onviction 8 Stic+ to )%at o& stan(3or *e'onstrate a )i$$ingness to $ive b o&r nob$est va$&es regar($ess o3 conse>&ences*on4t 3orget t%at ever (a )%en o& )a+e , o& )i$$ %ave to 3ace o&rse$3 an( $ive)it% o&r (ecisions 5o''&nication 8 Kno) %o) to ta$+ to an one, an )%ere in t%e)or$( 6etter et, beco'e an e"#ert at $istening 5o''&nication s+i$$s an( a +een insig%tinto %&'an nat&re %e$#s o& 'otivate ot%ers to join o& in getting a job (one ?0S%o)'ans%i# I3 o& +no) o& %ave )%at it ta+es to beco'e a g$oba$ $ea(er, get o&tt%ere an( toot o&r %orn Ho) e$se )i$$ t%e )or$( +no) abo&t o&1 G$oba$ $ea(ers%i#(oesn4t %a##en overnig%t It4s a s$o) #rocess t%at re>&ires t%o&g%t, (isci#$ine an( $ots o3%ar( )or+ Start to(a b #&tting so'e o3 t%e Ten Traits into action Ma be o& %ave t%e

#otentia$ to beco'e a g$oba$ $ea(er Notes 8


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Documents

Lesson 20 Entering Into New Market