Researching and Analysing Overseas Markets

1
Researching and Analysing Overseas Markets

• Background information
• Five rules for international research
• Entry evaluation procedure
• Stage 1 - Country identification
• Stage 2 - Preliminary screening
• Stage 3 - In-Depth screening
• Stage 4 - Final selection

2
Market information

• Market potential
• Consumer / customer attitudes and behaviour
• Channels of distribution
• Communications and media
• Market sources
• New products

3
Competitive information

• Competitive business strategy and goals (mission
  and rationale of the company)
• Competitive functional strategies and programmes
  (target markets, marketing mix, etc)
• Competitive operations (morale, employee
  transfers, i.e. detail)

4
Foreign exchange

• Balance of payments, interest rates, etc
• Prescriptive information e.g incentives,
  controls, regulations.
• Country monetary and fiscal policy
• Expectations of bankers, traders, analysts, etc
• Government policy in relation to its own
  competitiveness e.g China, USA

5
Resource information

• Human resources
• Money
• Raw materials
• Acquisitions and mergers, joint ventures

6
General conditions

• Economic factors - e.g. growth
• Social factors e.g. customs, attitudes
• Political factors e.g investment climate
• Scientific and technological factors - major
  developments and trends
• Management and administrative factors e.g. report
  procedure

7
Sources of information

• Human sources e.g company executives
• Documentary sources e.g too much!
• Perception sources e.g. what we see and hear
• Information and media
• face-to-face conversation
• telex/fax/e-mail
• sight, smell, taste

8
Five rules for international research

• One
• what information do I need?
• Where can I get this information?
• Why do I need this information?
• When do I need this information?
• What is this information worth in ?
• What is the cost of not obtaining this
  information?

9

• Two Start with desk research
• Three Identify the type of information that is
  available from overseas sources
• Four Know where to look (or find somebody that
  does)
• Five Do not assume that the information that you
  gain is comparable or complete.
• Keegan 1995

10
Entry evaluation procedure

• Stage 1 - Country identification
• Stage 2 - Preliminary screening
• Stage 3 - In-Depth screening
• Stage 4 - Final selection

11
Stage 1 - Country identification

• Candidate countries are identified and listed
• broadly based on general statistical information
• conduct population comparisons to predict market
  potential
• Indonesia 18 million, Malaysia 17 million
• Brazil 50 million, Chile 13 million

12
Stage 2 - Preliminary screening

• Rating the identified countries
• macro level - political stability, geographical
  distance, economic development
• Weed out countries from consideration
• anticipated cost of entry are calculated e.g.
  warehousing, product support, distribution

13
Stage 3 - In-Depth screening

• Core of attractiveness evaluation
• data specific to industry/market
• Market size
• Market growth - business cycle, computing rates
  of growth
• competitive intensity - e.g. US Dept of Commerce
  Market Shares Report
• Trade barriers

14
Stage 4 - Final selection

• Objectives brought to bear for a match
• Revenues and costs are compared for leverage
• Weights can be added to criteria based on
  objectives
• This leads to a final ranking
• Personal visits are made. Direct experience
  leads to final decision
• Johansson (1999)