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Learn the step-by-step process of researching and analyzing overseas markets, including entry evaluation procedure, market information, competitive insights, foreign exchange, and resource details. Dive into general conditions, sources of information, and five rules for international research to make informed decisions. Follow the comprehensive entry evaluation procedure from country identification to final selection. Johansson (1999) outlines the importance of personal visits in decision-making.
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Researching and Analysing Overseas Markets • Background information • Five rules for international research • Entry evaluation procedure • Stage 1 - Country identification • Stage 2 - Preliminary screening • Stage 3 - In-Depth screening • Stage 4 - Final selection
Market information • Market potential • Consumer / customer attitudes and behaviour • Channels of distribution • Communications and media • Market sources • New products
Competitive information • Competitive business strategy and goals (mission and rationale of the company) • Competitive functional strategies and programmes (target markets, marketing mix, etc) • Competitive operations (morale, employee transfers, i.e. detail)
Foreign exchange • Balance of payments, interest rates, etc • Prescriptive information e.g incentives, controls, regulations. • Country monetary and fiscal policy • Expectations of bankers, traders, analysts, etc • Government policy in relation to its own competitiveness e.g China, USA
Resource information • Human resources • Money • Raw materials • Acquisitions and mergers, joint ventures
General conditions • Economic factors - e.g. growth • Social factors e.g. customs, attitudes • Political factors e.g investment climate • Scientific and technological factors - major developments and trends • Management and administrative factors e.g. report procedure
Sources of information • Human sources e.g company executives • Documentary sources e.g too much! • Perception sources e.g. what we see and hear • Information and media • face-to-face conversation • telex/fax/e-mail • sight, smell, taste
Five rules for international research • One: • what information do I need? • Where can I get this information? • Why do I need this information? • When do I need this information? • What is this information worth in £ ? • What is the cost of not obtaining this information?
Two: Start with desk research • Three: Identify the type of information that is available from overseas sources • Four: Know where to look (or find somebody that does) • Five: Do not assume that the information that you gain is comparable or complete. Keegan 1995
Entry evaluation procedure Stage 1 - Country identification Stage 2 - Preliminary screening Stage 3 - In-Depth screening Stage 4 - Final selection
Stage 1 - Country identification • Candidate countries are identified and listed • broadly based on general statistical information • conduct population comparisons to predict market potential • Indonesia 18 million, Malaysia 17 million • Brazil 50 million, Chile 13 million
Stage 2 - Preliminary screening • Rating the identified countries • macro level - political stability, geographical distance, economic development • Weed out countries from consideration • anticipated cost of entry are calculated e.g. warehousing, product support, distribution
Stage 3 - In-Depth screening • Core of attractiveness evaluation • data specific to industry/market • Market size • Market growth - business cycle, computing rates of growth • competitive intensity - e.g. US Dept of Commerce ‘Market Shares Report’ • Trade barriers
Stage 4 - Final selection • Objectives brought to bear for a match • Revenues and costs are compared for ‘leverage’ • Weights can be added to criteria based on objectives • This leads to a final ranking • Personal visits are made. ‘Direct experience’ leads to final decision Johansson (1999)