Marketing

Global market decision 3

Chap 8

Fishermen’s friend

Export modes:

* Factors affecting foreign market entry mode decision:

Internal factors

Firm size + been in market since 1865

International experience + present in more than 120 countries

Product complexity – the product is simple

Product differentiated advantage + more expensive, stronger taste

Desired mode characteristics:

Risk averse –

Control +

Flexibility + not flexible

Transaction specific factors:

Tacit nature of know-how – fishermen is not complex

External factors

Socio –

Country risk +

Market +

Direct & indirect –

Intensity of competition –

Small number of relevant -

* Indirect export, this is when the manufacturing firm does not take direct care of exporting activities. For fishermen’s friends, they contracts/outsource their marketing activities with an independent company, Impex Management (within their country) so that they can focus R&D and manufacturing.

Product life cycle – mature

Factors influencing channel width –

Ikea case pg 435

Franchise model – intermediate modes (Denmark or Singapore )

Firm size +

International experience +

Product complexity +

Product differentiated advantage +

Desired mode characteristics:

Risk averse +

Control +

Flexibility –

Transaction specific factors:

Tacit nature of know-how +

Opportunistic behaviour & transaction cost - -

External factors

Socio –

Country risk +

Market +

Direct & indirect –

Intensity of competition –

Small number of relevant -

Autoliv:

Internal factors

Firm size +

International experience +

Product complexity + complex product

Product differentiated advantage +more competition

Desired mode characteristics:

Risk averse + risk taking company globally present

Control – production in different countries

Flexibility – flexible

Transaction specific factors:

Tacit nature of know-how +

Opportunistic behaviour &...