Considerations for Global Market Entry

This 21st Century is the age of globalization. Today’s world has become a ‘small commercial village.’ Due to the development of trade and commerce, science and technology etc., many companies are going global. The need to think and act from global perspective is universal. Globalization increases global competitive. It brings competition everywhere in the world. Thus, this is the age of competition. Today’s company should pay more attention to quality and price to survive in the competitive market. The variety of products and products forms in the market will significantly and substantially increase the customer choice. Besides these, the companies should create value to global target customers, it should gain competitive advantages, it should focus on needs and wants of target markets and it should follow positioning strategy to create strong brand image in global markets. In this regards, we can say that it is a great challenge to do marketing in the era of globalization.

Consideration for Global Market Entry

Going global is very challenging job. So a company should consider many things for global market entry. They are as follows:
  1. Political risks: A company going global should consider the political risks of global market. The elements of political risks are political instability, terrorism, civil war, etc. These all factors should be uncertainty in global markets.
  2. Access to market: Many factors may limit companies to access to global market. They are reservation policy for nationals, local content requirements, balance of payment problems, competition with local industry, regional cooperation agreements, etc. These all factors should be taken into consideration before going global.
  3. Cost structure: Cost structure should be taken into consideration for the companies going global. They should consider costs associated with factors of production such as land, capital, labor etc. Similarly they must consider the wages rate and tax related matters as well.
  4. Logistics: Logistics which is also known as physical distribution that consists of transportation, inventory management, warehousing, materials handling and order processing. These all are crucial to success in global markets. The cost of making goods and services readily available to global markets are very important for market entry. Similarly, there should be adequate infrastructure facilities, good governance, etc. in host country.
  5. Foreign exchange rate: The companies going global need to deal different currencies at a time. They need to follow foreign exchange regulations of the concerned countries and need to solve the currencies exchange problem. They should consider the exchange risk resulting from changing rates and control procedures.
  6. Marketing programs: Different countries have different political system and different government decisions. Different laws, rules and regulations of their own, govern marketing activities in different countries. So, the companies going global should prepare marketing programs as per the law, acts and local environment of host country.

No comments:

Post a Comment

Infolinks