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Strategic Decisions for International Entry

There are three strategic decisions related to international entry modes: which markets to enter, timing of entry, and scale of entry. Expanding internationally can provide economies of scale and scope but also poses higher risks, cultural challenges, and costs. Regionalization strategies include home base, portfolio, hub, platform, and mandate approaches. The bottom of the pyramid strategy aims to serve poorer populations by making products and services affordable through installment plans, cost cutting, small packages, pay-as-you-go pricing, and direct distribution. Local companies can defend their home market, shift business models, or transfer expertise internationally when competing with global firms.

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Kunjal Patel Bathani
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7 views9 pages

Strategic Decisions for International Entry

There are three strategic decisions related to international entry modes: which markets to enter, timing of entry, and scale of entry. Expanding internationally can provide economies of scale and scope but also poses higher risks, cultural challenges, and costs. Regionalization strategies include home base, portfolio, hub, platform, and mandate approaches. The bottom of the pyramid strategy aims to serve poorer populations by making products and services affordable through installment plans, cost cutting, small packages, pay-as-you-go pricing, and direct distribution. Local companies can defend their home market, shift business models, or transfer expertise internationally when competing with global firms.

Uploaded by

Kunjal Patel Bathani
Copyright
© All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PPTX, PDF, TXT or read online on Scribd

Strategic

decisions in
Internationalisat
ion
Three Strategic Decisions related to the
International entry modes:z

1. Which International Markets to Enter?


A rational assessment of international market opportunities
should be done.
2. Timing of Entry into International Markets
By timing of entry is meant whether the international entry is
made earlier than other international companies or later than them.
3. Scale of Entry into International Markets
Scale of Entry is meant entry on a small scale with little
commitment in terms of resources or a large scale entry.
Advantages of Expansion through
Internationalisation:

1. Realising economies of scale


2. Realising economies of scope
3. Expansion and Extension of markets
4. Realising Location economies
5. Access to resources
Disadvantages of Expansion through
Internationalisation:

1. Higher risks
2. Difficulty in managing cultural diversity
3. High bureaucratic costs
4. Higher distribution costs
5. Trade barriers
Regionalisation Strategies:

Regionalisation Meaning:
Semi-globalisation means neither extreme geographical
fragmentation of the world in the national markets nor
complete integration.

Five Strategies :
Home base
Portfolio
Hub
Platform
Mandate
Strategies for the Bottom-of-the-
Pyramid:
The BoP strategy is meant to show to the MNCs how to
exploit the opportunities that are believed to be available in
serving the poorer sections of the society.
The tactics suggested to implement BoP idea into practice
depends on making products and services affordable to
poor people.

1. Asking for easy payments in instalments


2. Dramatic cost Cutting
3. Offering products in small packages
4. Charging prices by pay-by-use
5. Direct distribution by avoiding costly market
intermediaries
Strategies for Local Companies
Competing with the Global Companies:

High Shifting to new Contend on a


business model or Global Level
market niche
Industry
Pressure to
Globalise
Low Defend by using Transfer company
home field expertise to cross-
advantages border markets

Tailored for Transfer to other


home market countries
Strategies for the Bottom-of-the-
Pyramid:
The BoP strategy is meant to show to the MNCs how to
exploit the opportunities that are believed to be available in
serving the poorer sections of the society.
The tactics suggested to implement BoP idea into practice
depends on making products and services affordable to
poor people.

1. Asking for easy payments in instalments


2. Dramatic cost Cutting
3. Offering products in small packages
4. Charging prices by pay-by-use
5. Direct distribution by avoiding costly market
intermediaries
Strategies for the Bottom-of-the-
Pyramid:
The BoP strategy is meant to show to the MNCs how to
exploit the opportunities that are believed to be available in
serving the poorer sections of the society.
The tactics suggested to implement BoP idea into practice
depends on making products and services affordable to
poor people.

1. Asking for easy payments in instalments


2. Dramatic cost Cutting
3. Offering products in small packages
4. Charging prices by pay-by-use
5. Direct distribution by avoiding costly market
intermediaries

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