Market Entry

Global opportunities in the auto industry have resulted in increases in production outside North America. This paper reports the results of a study in which a group of small automotive suppliers assessed the appropriateness of global entry strategies, and evaluated the degree of asset specificity and risks

We report the results of two experiments designed to study tacit coordination in a class of market entry games with linear payoff functions, binary decisions, and zero entry costs, in which each of n = 20 players must decide on each trial whether or not to enter a market whose capacity is public knowledge. The results show that although the subjects differ considerably from one another in their decision policies, tacit coordination emerges quickly on the aggregate level and is accounted for most successfully by the Nash equilibrium solution for noncooperative n-person games.

The existence of a learning curve in which a firm’s costs decline with cumulative experience suggests that early entry provides learning opportunities that create advantage by reducing future costs relative to later entrants. While prior strategy research often assumes that learning curves are deterministic and known ex ante to firms, a substantial body of evidence suggests that learning curves are inherently uncertain. If there is uncertainty in the learning curve, then the taken-for-granted wisdom regarding the strategic implications of learning curves may over- or under-emphasize the value of early entry. We consider two forms of uncertainty prospective (future costs) and contemporaneous (current costs). We demonstrate computationally that while prospective uncertainty in the learning curve enhances the benefits of early entry, contemporaneous uncertainty reduces these benefits. Further, we examine the implications of these findings for competition and learning curve spillovers between leader and laggard firms. Recognizing learning curve uncertainty highlights a novel form of spillovers that don’t affect expected cost, but rather affect uncertainty about cost. Our core insight is that when learning curve uncertainty is large relative to the expected learning rate, it is uncertainty, rather than expectations about this rate, that determines the extent of early mover advantage.

In this paper we develop an analytic model to provide insight into strategic capac- ity planning in competitive environments. We consider two firms, an incumbent and a (potential) entrant, operating in make-to-order fashion and competing with identical products. Customers react to full price (the sum of nominal price and expected cost of delivery leadtime). The market is imperfect in the sense that firms can influence equilibrium full prices. We model firms as queuing systems, characterized by produc- tion variability—a proxy for operational eciency—and capacity cost. Firms choose capacities (i.e., queuing service rates) according to a sequential game. The firms then engage in a simultaneous price game, with endogenously determined delivery leadtimes. In contrast to existing sequential entry models, this one includes a price (instead of quantity) post-entry subgame with a pure Nash equilibrium, incorporates "time to build," and as a direct consequence of its assumptions, p...

To what extent are firms kept out of a market by patents covering related technologies? Do patents held by potential entrants make it easier to enter markets? We estimate the empirical relationship between market entry and patents for 27 narrowly defined categories of software products during the period 1990-2004. Controlling for demand, market structure, average patent quality, and other factors,

A escasos días de la presentación oficial de Netflix en el mercado español, resulta procedente especular sobre los efectos que puede llegar a tener sobre el inmaduro mercado audiovisual de nuestro país, sometido a reestructuraciones muy recientes que han cambiado profundamente su fisonomía. Netflix ha sido considerada por muchos como  una auténtica reinvención de la experiencia de consumo de contenidos televisivos, y aunque llega a nuestro país con un considerable retraso con respecto a sus planes iniciales y con una oferta limitada, parece decidida a llevar a cabo una apuesta fuerte y con una visión a largo plazo. La expansión internacional es una prioridad absoluta para la compañía, que posee, además de abundantes recursos económicos, una enorme ventaja tecnológica y de percepción sobre cualquiera de los competidores locales basada en su reconocimiento de marca, su sistema de distribución, su modelo de precios y su sistema de recomendaciones. Los modelos de previsión indican un primer año de toma de posiciones moderado, seguido de una expansión intensa y de un crecimiento progresivo a medida que incrementa su oferta gracias a la recuperación de los contratos de sus series más conocidas y al desarrollo de su oferta de producción propia.

Produkty, ať už v podobě zboží nebo služeb, se musí nějakým způsobem dostat k zákazníkovi, jinak by byly z podnikatelského hlediska prakticky bezcenné. Jinými slovy, pokud produkt nebude na trhu dostupný (tj. nebude k dostání) pro cílovou skupinu zákazníků, bylo veškeré ostatní marketingové úsilí vynaloženo zcela zbytečně. Z pohledu marketingu se v této souvislosti hovoří o distribuci, zahrnující nejen fyzický přesun zboží, ale též zajištění marketingových cest neboli distribučních kanálů tak, aby zákazníkovi bylo vůbec umožněno si nabízený produkt nějakým způsobem obstarat, dostat se k místu jeho nabídky a vybrat si jej. Samotná volba konkrétních marketingových cest (resp. distribučních kanálů) by měla logicky vzít v potaz potřeby a přání zákazníků. Vhodnost
zajištění marketingových cest se samozřejmě odráží v následném úspěchu či neúspěchu podnikatelského subjektu. Obvykle se rozlišují přímé a nepřímé vstupy na trh, a tak cílem předkládaného příspěvku je nalézt konkrétní příklady v soudobé podnikové praxi, které budou dokazovat reálné využití možností těchto přímých a nepřímých vstupů na trh, jež jsou obvykle popisovány v marketingové teorii.

Foreign Direct Investment (FDI) is currently used as an important tool in the International Market environment by global investors for entering into an economy. It is also one of the key factors that supports and accelerates economic growth of the host economy. With the growing interest on FDI worldwide in the recent years, the literature on FDI is also expanding in many folds. This review is an attempt to provide an insight into the empirical studies done in the past to analyse and explore the determinants playing a major role in attracting investors. The study infers that there are similarities, dissimilarities, significance, insignificance and ambiguity in explanatory variables that determine FDI inflows.

Drawing on multiple theoretical perspectives, this paper develops an organizing framework that incorporates the antecedents and consequences associated with the choice of foreign market entry modes. The framework is then used to classify, review, and synthesize past empirical research and to identify major patterns and contradictions within and across the various research streams. Further, based on the review, the paper identifies key gaps in extant research and suggests several directions for future research

Research summary: We advance an integrative model in which distinct types of technological discontinuities (core-knowledge vs. complementary-asset) are combined with different appropriability regimes (strong vs. weak) to predict competitive and cooperative dynamics between incumbents and entrants. We posit that incumbents ally with entrants following a core-knowledge discontinuity when the appropriability regime is strong. When the appropriability regime is weak, incumbents are more likely to acquire entrants. We submit that the additional consideration of complementary-asset discontinuities reveals a more integrated theoretical model of competition and cooperation between incumbents and entrants. In particular, incumbents tend to cooperate among themselves following complementary-asset discontinuities, although we highlight theoretical nuances due to different appropriability regimes. We provide falsifiable propositions, and introduce contingencies such as firm-level heterogeneity and time dynamics.

Managerial summary: Interfirm cooperation is one possible avenue for existing firms to address the challenge of responding to discontinuous technological changes. What is not clear, however, is who should the incumbent ally with: other incumbents or new entrants? We provide an integrative framework to help managers to decide when to cooperate with competitors and when to cooperate with new entrants. When the core knowledge of incumbent firms is made obsolete by technological advances and intellectual property is fairly well protected, managers of existing firms should search out collaboration with new entrants. If intellectual property protection is weak, managers of incumbents firms are better off acquiring new entrants. When the downstream complementary knowledge such manufacturing and distribution are replaced by radically improved technologies, then incumbents best option is to cooperate with other incumbents in order to compete against new entrants.

A business report on a company interested in joint venture. A report on strategic marketing mix, analysis of General Electrics (GE Matrix) and Boston Consulting Group (BCG Matrix), Market Entry Strategy, International marketing strategy and SWOT Analysis.

This paper discusses the channels between openness and productivity and trade hampering factors. The stylized facts from the heterogeneous firms literature suggests that firms face market entry costs for each new product they export and to each new export market. Transport costs, border costs and retail and wholesale distribution costs might add up to 170% of the export value, but formal import tariffs and duties are relatively unimportant. The results by the Observatory of European SMEs survey, which has firm-level data for the whole European Union confirm this result. Lack of knowledge on export markets and regulations in other countries are important trade barriers for European firms. From these outcomes it could be derived that EU trade policies should be directed to deep integration with other countries, preferably by implementing internal market policies for goods and services trade and foreign direct investment. These policies can deal with reducing regulations heterogeneity,...

This paper attempts to examine the likelihood of incumbent firms taking defensive actions given certain market entrant characteristics. Using conjoint analysis, four market entrant characteristics, market entrant company size, price of market entrant's product, innovativeness of market entrant's product, and market entrant's reputation as a competitor were presented to marketing executives in nine simulated cases. The marketing executives were asked to indicate their likelihood of taking defensive actions before and after new competition enters a market. The relative weights associated with the four market entrant characteristics indicate that market entrant's price is the most important factor in influencing incumbent firms to take competitive actions followed by company size, market entrant's reputation as a competitor, and innovativeness of market entrant's product in both before and after market entry conditions.

Abstract: Ethnic entrepreneurs often concentrate in specific economic activities. Arab entrepreneurs in Singapore from the time of their first recorded arrivals in 1819 until the 1850s were concentrated in the consumer goods industry. The exit of the Arabs from consumer goods provision saw them moving into the real estate industry in the 1880s, where they remained concentrated until the 1940s. By the 1970s, however, no visible concentration of Arab entrepreneurs could be discerned. This paper argues that the entry and exit of Arab ethnic entrepreneurs into and out of consumer retail and real estate investments may be better explained with reference to political-economic conditions which facilitate movement than embedded personal relations that enact a chain-link pattern of industrial mobility.

In this study, it is firstly discussed how Bilateral Air Services Agreements (BASAs) and as a result the economic regulations in the international airline markets affect the management of scheduled airlines. By considering the introduced effects, a scale is developed to evaluate the BASAs of Turkey. To develop the scale, four different dimensions are determined by reviewing the literature: “market

This paper examines four aspects of managerial cognition among firms, as differentiated by speed of market entry. Aspects are: risk perception, proactivity, tolerance for ambiguity and international orientation. Internationalization speed is indicated by rapidity of first market entry resulting in three groups of firms: international new ventures, traditional exporters and domestic firms. For all groups, proactivity is the basic premise for risk perception, which in turn is the key variable in relation to internationalization speed. Risk perception is the element that may prevent a firm from internationalizing at all, in a timely manner, or fast enough to capture available opportunities.