Hcmc sfi mid-term Assignment

THE INTERNATIONAL UNIVERSITY (IU) – VIETNAM NATIONAL UNIVERSITY – HCMC
SFI MID-TERM ASSIGNMENT
Group 4
1. Le Trong Tan - BABAIU19396
2. Nguyen Dang Vu Loi - BABAIU19048
3. Vo Nguyen Nhu Quynh - BABAIU19082
1st November 2021

Table Of Contents
Abstract...............................................................................................1
Introduction..........................................................................................1
Research Method....................................................................................1
Export Strategy.......................................................................................2
Subsidiaries...........................................................................................4
Joint venture..........................................................................................7
Franchising...........................................................................................8
Greenfield.............................................................................................12
Applied theories of International Market Strategies to Hoa Phat Group.................13
Conclusion...........................................................................................16
References...........................................................................................16

Abstract
The goal of this review is to give readers a better grasp of the area of international marketing in
business as it has been explored by past researchers. Medium and large businesses are
increasingly interested in market expansion and attracting international investment. However,
cultural variety, a scarcity of raw materials, and international collaboration in the iron and steel
industry are still limited. This review document examines ten papers published in journals linked
to business, production, and strategic management between 1994 and 2014. The article
summarizes the enterprise's ability to trade goods with domestic and overseas partners, as well as
the various definitions, measures, and theories used throughout the page, as well as the methods
that can be used to extend the market. The findings reveal that organizations are still expanding,
and that diverse methodologies have been utilized to define, measure, and theorize the
responsiveness and scaling of management in the firm. People will visualize its impact on the
market and the variables that stimulate the development and extension of the firm to worldwide
reach through the five aspects of the international market strategy.
Keywords: International market strategy, Export, Joint Venture, Subsidiaries, Franchising,
Greenfield
Introduction
Over the years, internationalization is one of the most popular strategies for organizations
looking to grow their operations and obtain competitive advantages. Manufacturing in the home
country and exporting products to overseas markets are the most common ways for private
enterprises from emerging economies to globalize their business. The foreign-expand methods of
those enterprises usually follow the trend of using both the internationalization and international
product life cycle models: at first, the enterprises export their products to the designated
countries, after they have accumulated experience from that market, they will develop the
commitment in a more investment-focused way. Those ways can be export strategy, subsidiary,
joint venture, franchising, and greenfield investment. The following study will provide thorough
knowledge about each strategy.
Research Method
With the purpose of evaluating the International market strategy and relevant subjects written by
experts, researchers used a literature search approach given previous review papers. Scholars
conducted an electronic search of financial statements, business, and managerial journals, using
the key terms in the heading or body of the article: exporting, subsidiaries, joint venture,
franchising and greenfield companies. The preliminary results of the search yielded a variety of
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papers, and we restricted the search to articles published between 1994 and 2014, or about 20
years. Each paper was reviewed to determine whether its message was crucially relevant to
International market strategy. Specific articles were thoroughly read and checked to raise the
report's reliability and accuracy, and 10 relevant articles were selected.
Export Strategy
To become more competent in the global market, studies have been conducted to provide
comprehension of the export strategies of enterprises from emerging economies. Particularly,
these studies create a framework by combining various strategies about competence in
international marketplaces with export performance. The logic behind the framework is that
although it has been demonstrated that organizational characteristics and managerial risk
perceptions affect internationalization behavior, the current global competitiveness needs the
proactive adoption of specialized export strategies to achieve success in foreign markets. The
study includes three factors to explain the export performance: the competitive strategies of cost
leadership and differentiation, marketing standardization, and geographical diversification of
exports.
Cost leadership and differentiation strategies concern how a firm develops an advantage over
competitors in an industry. A cost-leadership strategy is about providing customers with
comparable value at a lower price than that of rivals. Enterprises that follow this strategy can
reduce prices to match competitors while still earning profits and gaining above-average returns.
Exporting enterprises usually implement a cost-leadership strategy in developed country
markets, which is characterized by competition and dynamism. Exporting enterprises from
emerging countries are at a disadvantage compared to the local companies in terms of reputation,
capital, technology, and product innovation. Furthermore, from customers’ view, products from
developing countries are considered to have bad quality and low price. From all the factors
mentioned, exporting enterprises cannot use differentiation strategies in developed countries.
However, they can use a cost-leadership strategy instead due to their cost advantages. Enterprises
from emerging countries possess this advantage thanks to the low cost of labor, R&D process,
and marketing program. Therefore, those enterprises can easily gain success from developed
country markets by implementing cost-leadership strategy; besides, their products also adapt
customers’ mindset about low price products from emerging countries.
A differentiation strategy aims to provide a product or service that customers perceive to be
unique; this can be achieved through ways such as brand image (Apple, Mercedes-Benz),
technology (Tesla), service, and innovation. The primary purpose of the differentiation strategy is
to build a loyal customer base and create obstacles for newcomers. Thanks to the customers’
loyalty, the demand for the enterprise’s products is inelastic, which will bring a higher profit
margin. Developing countries are the most appropriate place for exporting enterprises to carry
out differentiation strategies. Those marketplaces are characterized as protected economies, so
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