The current business environments require firms to be highly aware of expansion of the global market. Entering a new market without sufficient understandings and preparation is never a good choice of companies to further their endeavor. Accordingly, a firm should take deliberate steps to analyze and recognize promising targets. For a company, especially an SME, the market research is an important issue that firms need to deliberate due to the limitations of its resources and capabilities. Researching the potential export markets is the significant preparation that needed to carry out prior to entering an overseas market because not many companies really comprehend geographical, social, economic facts of the foreign countries in comparison with the home countries (Cavusgil, 1985). Besides, researching for the international market opportunities is not a discrete activity, but a combination of collecting, analyzing, and concluding data logically.
Regarding the international expansion, a great concern of a firm is to identify it promising markets. That is the problem of answering the questions: How does a firm evaluate its targeted markets? What criteria helps select the market? For these reasons, this report will develop a practical guide with highly recommended practice for the firm to evaluate and identify its attractive export markets.
The discussion in the report aims to assist an SME Irish company to optimize its analysis and selection of the future market to expand its exporting activities to the BRICS (Brazil, Russia, India, China, and South Africa). The approach in the report is to provide the practical recommendations that based on significant studies on market selection. This is a highly contemplated report which demonstrates the desire to create insightful implementations.
The term ‘company’ or ‘firm’ is mainly implied to small and medium enterprises with regard to the export facet rather than for large international enterprises. Besides, the entry modes are presumed to be the subsequent decision of the firm after identifying the market elect and therefore, would not be covered in this report.
1. Apply a systematic process of researching export markets (3 steps)
The matter of determining international market opportunities is a great concern of the company’s execution. Numerous researches have been carried out to establish possible methods (Gaston-Breton and Martin, 2011, Rahman, 2003, Cavusgil, 1985, Douglas et al., 1982,) and demonstrate the primary determinants (Rahman, 2003, O'Farrell and Wood, 1994, Douglas et al., 1982) in selecting the optimal international market for business expansion.
According to Rahman (2003), most of the firms try to approach the market evaluation in two-stage, which comprise of a procedure to assess the interested overseas targets and an examination of the markets by applying various indicators. Cavusgil (1985) contends that the company’s market selection is most effective...