Foreign Market. Use Powerpoint Presentations I Attached.

¶ … foreign market. Use Powerpoint presentations I attached. Strategies of entering a foreign market Corporations are said to have become one of the most important forces in the world economy, not only by the volume of business they conduct at a transnational level but also through the influence they can exercise at the level of the national governments and regional economies. The examples are numerous and include some of the most important multinational companies in the software, car making, oil producing industries, or retailers.

However, corporations developed from small businesses, with impressive initiatives, and great potential that they developed and then "exported" abroad. In this sense, some of the most complex marketing and business plans were initiated and strategies to enter foreign markets emerged.

There are several aspects to be taken into account when dealing with a successful strategy for entering a foreign market: the way in which a company decides to enter the market, the way in which it chooses that market, what are the risks, and what is the form of entering the market. There are several ways in which a company can enter the market. It can impact the local market through the exports the company is making.

Most transnational companies set the pace for their presence in a foreign country by exporting in that country and the examples range from the manufacturing companies to the know-how companies that export knowledge. Other ways of entering the market include licensing or franchising to host country firms, strategic alliances through joint ventures with a host country firms, opening subsidiaries in the host country. Each and every one of these means has advantages and disadvantages related mostly to the particularities of the company and the country aimed.

In this sense for instance, creating a joint venture with a local company may provide for the foreign company a substantial contribution in terms of better appealing to the local market because of the knowledge the local company has over the market; on the other hand however, the association with a local company may, in the case in which this association is not successful, harm the prestige of the foreign company on the local market as well as worldwide.

The risks that need to be taken into account when deciding to enter a foreign market are also related to the economic and political spectrum of the country as well as the firm's strategy and offering. Better said, for manufacturing companies, it is important to take into account when choosing areas of expansion for production the availability of the resources, both natural and in terms of workforce, as well as the legal framework that governs the use of such resources in the respective country.

If not taken into account, such risks may become serious liabilities for the company that may eventually backfire at later stages of penetration of the local market. The firm's strategy for expansion must also be taken into account and, in order to reduce to the minimum the risks of possible lack of homogeneity in approach, it must be decided upon at the top management level as to include local economic, political, and social risks. The choice of the timing to enter the market is intimately related to these risks.

More precisely, the risk curve must be at a minimum in order to allow the expanding company to limit its exposure to political fluctuations, negative economic developments, or social unrest that would determine a rather difficult business environment for the company. This is one of the main reasons for which states, and especially the developing nations, aim to create simplified and investment-friendly business environment. The choice of the market is yet again another essential point in the strategy to expand internationally.

For instance, Oracle Corporation decided to move part of its business in India particularly because of the workforce market it had available locally. The legislation as well as the political environment were benefic for the Redwood-based corporation and now an important part of the support business for Oracle is done in their offices in India. Another important aspect in the strategies to enter foreign market is connected with the way in which this entry is made, by exporting or by creating local presence, either through joint ventures or subsidiaries.

This is the human capital involved in these strategies. For instance, companies that export.