Importance of Foreign Market Entry
For a business organization to grow, it has to constantly find new opportunities to exploit. Globalisation is a large driving force that has led to the trend of the rising number of business organizations operating beyond their home country.
As with globalisation,there is now a decrease in trade barriers which makes doing business abroad easier.Likewise,there is also an increased in the number of competitors in the local market and many a times, a organisation has to expand into a new foreign market so as to achieve a higher market share.
One major pushing force for a organisation to go abroad is the limited opportunities in the local market which could either have no need for the organisation’s offerings or the market could be quite saturated.A global market,on the other hand,offers endless possibilities and a bigger market.Consider a small country like Singapore which only has a population of close to 5 million, a business organisation can do so much more with an expansion overseas whereby the population size is many times the local population.Local companies like Eu Yan Sang (traditional chinese medicine) or Prima Taste have their products located in different parts of the world where there are definitely a demand for it.Consider the Chinatown in London where many Chinese nationalities are currently residing/studying at.Chinese products that are found in their home countries are bound to appeal to them due to the brand familiarity as well and if there is a demand for such products,business organisations can reap from the benefits by supplying these products.
This is also the case for many agriculture industries whereby the production of the products are far much more than what the population can consume.The amount of coffeebeans that are harvested in Latin America are more than sufficient for its population and organisations can make a profit out of it by actually selling the excess.
The importance about a global expansion is also the competitive
As with globalisation,there is now a decrease in trade barriers which makes doing business abroad easier.Likewise,there is also an increased in the number of competitors in the local market and many a times, a organisation has to expand into a new foreign market so as to achieve a higher market share.
One major pushing force for a organisation to go abroad is the limited opportunities in the local market which could either have no need for the organisation’s offerings or the market could be quite saturated.A global market,on the other hand,offers endless possibilities and a bigger market.Consider a small country like Singapore which only has a population of close to 5 million, a business organisation can do so much more with an expansion overseas whereby the population size is many times the local population.Local companies like Eu Yan Sang (traditional chinese medicine) or Prima Taste have their products located in different parts of the world where there are definitely a demand for it.Consider the Chinatown in London where many Chinese nationalities are currently residing/studying at.Chinese products that are found in their home countries are bound to appeal to them due to the brand familiarity as well and if there is a demand for such products,business organisations can reap from the benefits by supplying these products.
This is also the case for many agriculture industries whereby the production of the products are far much more than what the population can consume.The amount of coffeebeans that are harvested in Latin America are more than sufficient for its population and organisations can make a profit out of it by actually selling the excess.
The importance about a global expansion is also the competitive