BULE HORA UNIVERSITY

COLLEGES OF BUSINESS AND ECONOMICS

DEPARTMENT OF MARKETING MANAGEMNT

COURSE TITLE:- INTERNATIONAL ARKETING

COURSE COUDE:-MKTM4071

Acadamic year 2016/2023

4th yeat 1st semester

Program Regular

Individual Assignment

Prepared By:- ID:-

Bekalu Habtamu.......................2708/13

Subimitted To:-Mr.Kenesa K.

Submission Date:- 15/05/2016

BULE HORA ETHIOPIA

Suppose you are the owner of large organization and you decide to entry new
foreign market. Which enter mode you will select? Why? Which country you
want to enter? Why? Note:- consider the reality of Ethiopian and the country you
are enter environment.

Introduction

As an AI language model, I don't have personal opinions or experiences as the owner of a large
organization. However, I can provide you with some considerations to help you make an
informed decision.

When selecting the entry mode for a new foreign market, it is important to assess different
factors, including your company's resources, capabilities, risk tolerance, and the target market's
characteristics. Here are some factors to consider:

1. Resources and capabilities: Evaluate your company's financial strength, production

capabilities, managerial expertise, and distribution networks. This will help determine if you
have the resources and capabilities to enter the target market directly or if indirect exporting or
strategic alliances would be more suitable.

2. Market knowledge: Consider your understanding of the target market. If you have
limited knowledge or experience in the foreign market, partnering with a local distributor or
forming a joint venture with a local company might be beneficial. This can provide valuable
market insights and help overcome cultural and regulatory barriers.

3. Risk tolerance: Different entry modes carry different levels of risk. If you prefer to
maintain full control and minimize risk, a direct export or foreign subsidiary may be more
suitable. On the other hand, if you are open to sharing risks and costs, joint ventures or
strategic alliances can offer shared investment and local market knowledge.

4. Country selection: The choice of country depends on various factors such as market
size, economic growth, political stability, cultural compatibility, regulatory environment, and
competitive landscape. Considering the reality of Ethiopia, it may be beneficial to target
countries that have trade agreements with Ethiopia, shared cultural similarities, or emerging
markets with growth potential.

It is important to conduct thorough market research and analysis to identify the most suitable
entry mode and target country based on your company's unique circumstances. Consulting with
industry experts, trade organizations, and local business advisors can also provide valuable
insights and guidance.

The main international market entry modes

1. Exporting: This involves producing goods or services in one country and selling them in
another. It can be done directly by the company or through intermediaries such as distributors
or agents.

2. Licensing: This mode allows a company to grant another company the right to use its
intellectual property (such as patents, trademarks, or copyrights) in exchange for royalties or
fees. The licensee can then produce and sell the products in their own market.

3. Franchising: Similar to licensing, franchising involves granting another company the right
to use the trademark, brand, or business model of the franchisor. However, in franchising, the
franchisee operates under a standardized system and is often required to adhere to specific
guidelines or rules set by the franchisor.
4. Joint ventures: In a joint venture, two or more companies form a new entity to pursue a
specific business opportunity in a foreign market. The partners share ownership, control, and
profits, and this mode allows for pooling of resources, expertise, and market knowledge.

5. Strategic alliances: Strategic alliances involve collaboration between two or more

companies to achieve common goals, such as entering a new market or developing new
products. Unlike joint ventures, strategic alliances do not involve the creation of a new entity,
but rather a cooperation agreement between the participating companies.

6. Direct investment: This mode involves establishing a physical presence in a foreign

market through acquiring or establishing a subsidiary, branch, or production facility. Direct
investment provides a higher level of control and allows companies to adapt their operations to
local market conditions.

7. Greenfield investment: Greenfield investment refers to building a new facility or

business from scratch in a foreign market. This mode allows for full control over operations and
enables companies to customize their facilities and processes to suit local market dynamics.

Each mode has its own advantages and considerations, and companies need to carefully
evaluate their goals, resources, and the target market before deciding on the most suitable
entry mode.

How to choose the right entry mode for new international market

Choosing the right entry mode for a new international market requires careful consideration of
several factors. Here are some steps to guide you in the decision-making process:
1. Market analysis: Conduct a comprehensive analysis of the target market, including its
size, growth potential, competitive landscape, cultural and legal factors, and customer
preferences. Evaluate the demand for your products or services, as well as any potential
barriers to entry.

2. Company capabilities and resources: Assess your company's resources,

capabilities, and expertise. Consider factors such as production capacity, financial strength, R&D
capabilities, marketing and distribution networks, and managerial expertise. Choose an entry
mode that aligns with your company's strengths and minimizes risks.

3. Risk assessment: Evaluate the risks associated with each entry mode. Consider factors
such as political and economic stability, legal and regulatory frameworks, intellectual property
protection, currency fluctuations, and potential cultural or language barriers. Choose an entry
mode that minimizes the risks and provides a level of control that matches your comfort level.

4. Cost analysis: Assess the financial implications of each entry mode. Consider factors
such as setup costs, ongoing operational costs, marketing and distribution expenses, and
potential return on investment. Choose an entry mode that provides a good balance between
cost-effectiveness and market potential.

cotten company
There isn't a specific "Cotten Company" that is widely known or recognized in the context of a
well-known cotton-related company. However, cotton is a widely cultivated and traded crop
around the world, and there are several companies involved in the cotton industry. These
companies may be engaged in activities such as cotton cultivation, ginning, textile
manufacturing, trading, or retail. Here are a few examples of prominent cotton-related
companies:
1. Cargill: Cargill is a multinational agricultural commodities trading company that is involved
in the cotton industry through its trading and processing operations. It buys and sells cotton
worldwide and provides various services to cotton growers and buyers.

2. Louis Dreyfus Company: Another major agricultural commodities trading company,

Louis Dreyfus Company, is involved in the cotton trade alongside other commodities. It
operates in various stages of the cotton supply chain, including sourcing, processing, and
merchandising.

3. Cotton Corporation of India: The Cotton Corporation of India (CCI) is a government-

owned organization in India responsible for promoting and facilitating the trade of cotton
within the country. It undertakes procurement, marketing, and distribution activities to support
cotton farmers and maintain stable prices.

4. Olam International: Olam International is a global agri-business company that

operates across several agricultural sectors, including cotton. It engages in the sourcing,
processing, and trading of sustainably grown cotton, ensuring traceability and quality
standards.

5. Cotton Incorporated: Cotton Incorporated is a research and marketing company that

focuses on promoting cotton and its products in the United States and internationally. It
conducts research on cotton production, textile technology, and consumer preferences to
support the global cotton industry.

These are just a few examples, and there are many other companies involved in the cotton
industry globally. The specific company information may vary depending on the country or
region of interest.

cotten company export to Japan

Cotten Company, being a fictional company, does not have any specific information regarding
its business operations or whether it exports to Japan. However, in general, companies in
various industries may export their products to Japan, depending on their specific business
model and target markets. Exporting to Japan can offer opportunities in sectors like
automotive, electronics, machinery, food and beverages, pharmaceuticals, and more. It
ultimately depends on the capabilities, resources, and strategies of the specific company in
question.

SELECT THE EXPORT MODE OF ENTERY

The selection of the export mode of entry depends on various factors such as the company's
resources, objectives, target market, and industry. Some common export modes of entry
include:

1. Indirect Exporting: In this mode, the company uses intermediaries such as export
agents, export management companies, or trading companies to sell products in the foreign
market. The intermediaries handle various aspects of the export process, including marketing,
sales, distribution, and logistics.

2. Direct Exporting: In this mode, the company directly exports its products to the foreign
market. It can establish its own sales force, open offices or warehouses in the target market,
and handle all aspects of the export process. This mode provides the company with more
control and direct access to the market but requires more resources and capabilities.

The selection of the export mode of entry is a strategic decision that requires careful analysis
and consideration of various factors. It is recommended to conduct market research, assess the
company's capabilities and resources, evaluate risks and costs, and consider long-term
objectives before making a decision.

Advantege and Disadvantegs exorting mode of enter

Advantages of Exporting Mode of Entry:

1. Market Expansion: Exporting allows companies to expand their market reach beyond
domestic borders and tap into international markets, potentially increasing sales and revenue.

2. Economies of Scale: Exporting enables companies to benefit from economies of scale

by producing larger quantities for a wider market, leading to cost savings and improved
profitability.

3. Reduced Risk: Exporting can help diversify business risks by not relying solely on the
domestic market. If the domestic market experiences a downturn, international sales can help
offset the impact.

4. Access to Resources: Exporting can provide access to new resources, such as raw
materials, skilled labor, or technological advancements, which may not be easily available
domestically.

5. Brand Building: Exporting allows companies to build brand awareness and reputation in
foreign markets, creating the potential for future business opportunities and market growth.

Disadvantages of Exporting Mode of Entry:

1. Market Entry Barriers: Exporting may face various barriers, such as tariffs, trade policies,
customs regulations, and cultural differences that can increase costs and hinder market entry.

2. Competitive Challenges: Entering foreign markets through exporting often means

competing against well-established local competitors who have better knowledge of the market
dynamics.
3. Transportation and Logistics: Exporting requires effective transportation and
logistics management to ensure timely delivery and minimize shipping costs, which can be
challenging for small or inexperienced exporters.

4. Currency Risks: Exporting exposes companies to currency fluctuations, which can affect
profitability. Exchange rate fluctuations may make exported goods more expensive or result in
lower profits when converted back into the company's domestic currency.

5. Limited Control: Exporting may involve relying on intermediaries or distributors in the

foreign market, resulting in less control over marketing strategies, pricing, and customer
relationships compared to other entry modes like direct investment or licensing.

It's important to note that the advantages and disadvantages may vary depending on the
specific industry, product, market, and company's capabilities and resources.