Market entry strategy
From Wikipedia, the free encyclopedia
A market entry strategy is to plan the a method of delivering goods or services to a target market and distributing them there. when importing or exporting services, it refers to establishing and managing contracts in a foreign country.
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[edit] Factors
Many companies successfully operate in a niche market without ever expanding into new markets[who?]. Some businesses achieve increased sales, brand awareness and business stability by entering a new market[who?]. Developing a market entry strategy involves a thorough analysis of potential competitors and possible customers[who?]. Some of the relevant factors that are important in deciding the viability of entry into a particular market include Trade barriers, localized knowledge, price localization, Competition, and export subsidies.
[edit] Timing of the market entry
"What countries to enter and when mainly depends on the finanical resources of a company, the product lifecyle and the product itself." [1]
The different strategies available are:
- Waterfall strategy
- Wave strategy
- Sprinkler strategy
[edit] Strategies
Some of the most common market entry strategies are: directly exporting products, indirect exporting using a middleman, and producing products in the target market.[2]
But also:
[edit] Market entry and trade risks
Some of the risks incurred when entering a new market and start domestic or international trade include:
- Weather risk
- Systematic risk, different from systemic risk, the systematic risk is the risk inherent to the entire market or an entire market segment [7]
- Sovereign risk
- Foreign exchange risk
- Liquidity risk
While some companies prefer to develop by their own their market entry plans, other outsource to specialised companies[who?]. The knowledge of the local or target market by those specialized companies can mitigate trade risk[citation needed].
[edit] Sources
- Reviving Traditions in Research on International Market Entry, Po Li (Auteur), T. Li, JAI Press, 2003 ISBN-10: 0762310448 ISBN-13: 978-0762310449
- On durable goods markets with entry and adverse selection,Janssen, M. Roy,CANADIAN JOURNAL OF ECONOMICS,2004, VOL 37; NUMBER 3, pages 552-589 ISBN ISSN 0008-4085
[edit] References
- ^ Lymbersky, C.: (2008) "Market Entry Strategies", p. 364; Management Laboratory Press, Hamburg
- ^ Corporate documents, Chapter 7: Market Entry strategies
- ^ Lymbersky, C. (2008) "Market Entry Strategies", Management Laboratory Press, Hamburg
- ^ Lymbersky, C. (2008) "Market Entry Strategies", Management Laboratory Press, Hamburg
- ^ Lymbersky, C. (2008) "Market Entry Strategies", Management Laboratory Press, Hamburg
- ^ Lymbersky, C. (2008) "Market Entry Strategies", Management Laboratory Press, Hamburg
- ^ investopedia, systemic risk
