Assignment on International Market Entry Strategy
Added on 2020-05-28
45 Pages13863 Words1476 Views
What are the most effective entry modesthat international companies should selectand implement to Turkish market?
Effective Entry Modes to Turkish Market2ContentsIntroduction:.....................................................................................................................3Introduction of Turkish Market:.......................................................................................5Entry Modes:....................................................................................................................7Exporting:...................................................................................................................11Licensing and franchising:.........................................................................................12Joint venture:..............................................................................................................16Acquisition ...............................................................................................................18Greenfield Venture:....................................................................................................19Entry Mode in Turkish Market:......................................................................................21The case 1: Acquisition .................................................................................................25The case 2: Strategic alliance.........................................................................................26Compare and contrast between the two entry modes.....................................................28The effectiveness of the entry modes.............................................................................29Recommendation and Conclusion:.................................................................................31References:.....................................................................................................................35
Effective Entry Modes to Turkish Market31.Introduction2.Literature Review2.1.Globalization 2.2.International Market Dynamics and The Rise of Multinational Companies2.3.Approaches for International Entry Modes2.3.1.Internalization Theory2.3.2.Eclectic Theory2.4.Types of Entry Modes2.4.1.Exporting2.4.2.Licensing and Franchising2.4.3.Strategic Alliances2.4.4.Partnership2.4.5.Acquisition2.4.6.Joint Venture2.4.7.Greenfield Venture3.Project and Analysis3.1.Scope of the Analysis3.2.Research Problem3.3.Turkish Market Dynamics3.4.Entry Modes into the Turkish market3.5.Case Analysis3.5.1.Case 1: Acquisition, Mahindra and Erkunt Traktör3.5.2.Case 2: Strategic Alliance, Visma Retail and Kesit Bilişim3.6.Effectiveness of Entry Modes3.7.Findings and Discussion4.Conclusion
Effective Entry Modes to Turkish Market4Introduction:We are living in the era of globalization which changes rapidly and it is a humannature to live with such phenomena. Globalization could be seen as a continuous processwhich helps the organization or individuals to make new ideas, competition, practices,identities, movements and values. Globalization could lead to different situations whichdepend on the individual and organization perspective. The topic of entry mode has beendiscussed through many researchers in their article and they describe that it is significant forthe companies to diversify their market so that the profitability of company could enhanceand the customer base could also be wider. The researchers describe – çok fazla “describe” kelimesi kullanmışsın, eşanlamlılarını da kullan - that there are various ways for a company to enter into theinternational market and offer its product and services to the foreign clients. This processenhances the goodwill of the company in international market. It has also been analyzed thatentry mode of manufacturing company becomes quite easy now days but still the entry ofservice companies are less in comparison of manufacturing companies (Brouthers andHennart, 2007). Entry mode must be investigated properly before entering into a market sothat the best decision could be made by the company about the market and entry mode in themarket. This report has been analyzed to investigate over the international market entry mode.It has been found through this report that there are many ways for a company to enter intointernational market to diversify its market and to enhance its operations as well as sales ofthe company. In the era of globalization, it becomes mandatory for every company toenhance its operations and diversify its market globally (Tihanyi, Griffith and Russell, 2005).
Effective Entry Modes to Turkish Market5The report describes about the entry in Turkish market of other country’s company.In this report every aspect related to Turkish market and entry in Turkish market has beenanalyzed. Firstly, Turkish market has been studied and found that there are many risks inTurkish market as the country is still trying to become a part of European union and thepolicies and rules and regulations of turkey is far different from other European countries. Ithas also been analyzed that company suffers many risk such as terrorist attack and lessflexibility in the market. Further, we explain the user about the mode of effective entry in international marketsuch as exporting, franchising, licensing, strategic alliances, partnership, acquisition, jointventure, Greenfield venture etc. Moreover, the risk and benefit of every effective entry modehas been analyzed so that the best entry mode could be decided. It has been analyzed thatevery entry mode is different and have different risk perspective and benefits. Internationalmarket has become significant. And in case of Turkish market, the country is welcoming theforeign countries from heart to come into the market and explore the Turkish market. International markets have different strategy for every business to enter into theinternational market and give their service or products to the foreign clients. It has beenanalyzed through this report that companies are isolated due to many factors such as tradebarriers, trade distances, culture and time. A company must enter into the internationalmarket for advancement of technology, decrease storage cost, decrease transport cost,identification of new segment and less need about customized product as existed companieshave almost similar products. Further, the effective entry mode in Turkish market has been analyzed such asexporting, franchising, licensing, strategic alliances, partnership, acquisition, joint venture,Greenfield venture etc. it has been found that which market mode is suitable in Turkishmarket and how it would help the international companies to set up their business in turkey
Effective Entry Modes to Turkish Market6and enjoy the growth. It has been analyzed that every entry mode is different and havedifferent risk perspective and benefits. International market has become significant. Then, the report represents two cases that shows two different entry modes which hasbeen chosen by two different international company in entering to Turkish market. At lastly, this report project/study (lütfen hepsini değiştir) gives a concise explanationexplains about the recommendation given to the international companies to enter into theTurkish market and enhance the business. It explains – peşpeşe hep aynı kelimelerikullanmamaya çalış - the international companies that which market mode is suitable inTurkish market and how it would help the international companies to set up their business inturkey and enjoy the growth. Finally, conclusion of the study has been given to make it moreclearly to the user about the study and the decisions and recommendation which has beentaken whiles this study. The conclusion part describes the user about the whole report insummary. Globalization:Globalization refers to the process which emphasizes upon the interaction among theindividuals, government and the organizations of different countries by the means ofinternational trade and investment in the foreign countries (Hirst, Thompson and Bromley,2015). This involves the increase in the flow and interchange of international currency,thoughts, ideas and culture across the nations. Globalization enables the organizations tooperate on the international scale and develop greater global influence. The amount ofglobalization largely influences the amount of international trade and the level of culturalexchange among the countries. Globalization involves the economic integration of theinternational markets as well as the integration of socio- cultural values and norms.
Effective Entry Modes to Turkish Market7Introduction of Turkish Market:Turkish market has been studied and found that there are many risks in Turkishmarket as the country is still trying to become a part of European union and the policies andrules and regulations of turkey is far different from other European countries. It has also beenanalyzed that company suffers many risk such as terrorist attack and less flexibility in themarket. Still many significant are there due to which international companies see anopportunity in the market. Many barriers are also there to hamper entrance into the Turkishmarket but it could be resolved quickly and with a little bit knowledge about the Turkeyconceptual framework, contacts and language assistance. Any strategy of market entry inTurkey should initiate with a careful understanding of the benefits and cost to doing businessin Turkish market (Forlani, Parthasarathy and Keaveney, 2008). An international company must consider their own resources, business experienceabroad, long-term business strategy and previous export before entering the Turkish market.For most of the international companies, describeion in Turkey through distributor, liaisonoffice, partner or Turkish agent would be a significant key in terms of success. Even thoughit’s not required for the local partners that they could offer knowledge and understanding ofthe regulatory framework in Turkish market, valuable business contacts and languageassistance (Dow and Larimo, 2009). With the development of the company, companies couldopen many subsidiaries and could also make more investments locally to increase theirmarket share and value of the business. In Turkey, the U.S. Commercial Service has various programs and services offered tohelp American businesses and other businesses in instituting an existence in this market andmanaging and developing suitable links. Experienced Staffed with Specialists in commercial
Effective Entry Modes to Turkish Market8services with many years in sector expertise and industry, the Commercial Service team ofother countries in Turkey could tailor the business approach for the right audience, and offerrecommendation on the business strategy in Turkey (Canabal and White, 2008).Thus it could be said that with many issues and risk in the market of Turkey still it isthe best option to enter and diversify the market by international companies as still manysignificant are there due to which international companies see an opportunity in the market.Many barriers are also there to hamper entrance into the Turkish market but it could beresolved quickly and with a little bit knowledge about the Turkey conceptual framework,contacts and language assistance.Entry Modes:Today, in the era of globalization, with various opportunities as well as hugecompetition, it is good for the international companies to enter into new market so that thebusiness could be enhanced. Entry mode in international market or foreign market is basicallyan arrangement among the institutions which make it possible for the organization to enterinto the foreign market with new technology, management, human skills, advancement orother resources (Blomstermo, Deo Sharma and Sallis, 2006). Basically, whenever a companythinks about diversifying its market into foreign market than it is because of economicadvantages or some other advantages that could make them more popular among the clientsand the share price of the company could also enhance. It is a crucial decision for thecompanies to decide that whether they should enter into the new market or if yes than whatwould be the effective mode to enter into the market. It has been found that entry mode getaffected with many variables such as environmental variable, strategic variable, transactionvariable or other specific variables.
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