Steps in the market and site screening process
The screening process can be approached in a systematic four-step manner.
- Step one involves identifying basic appeal for potential markets (e.g., basic product demand) and/or as assessing the availability of resources for production (e.g., raw materials, labor, capital).
- Stepped two of the screening process is to assess the national business environment of the market or site. This involves examining the local culture, political and legal forces (e.g., government bureaucracy, political stability), and economic variables (e.g., fiscal and monetary policies)
- step three of the screening process is to measure the potential of each market (e.g., market size and growth, market potential indicator) and/or suitability of a site for operations (e.g., availability of workers, managers, raw materials, infrastructure).
- In step four of the screening process, managers normally visit each remaining location to make a final decision (e.g., competitor analysis, and financial valuation).
Three primary difficulties of conducting international market research
The collection and analysis of information in order to assist managers in making informed decisions is called market research. Unique conditions and circumstances present three main difficulties that often force adjustments in the way. Research is performed in different nations.
- First, managers can face problems with regard to the availability of data. It can be difficult to obtain high quality, reliable information. In addition to deliberate misrepresentation, tainted information can also result from in proper local collection methods in analysis techniques.
- Second, the comparability of data across markets can be difficult because terms such as poverty, consumption, and literacy can differ from a nation to another. Different ways of measuring statistics also affect the comparability of data.
- Third, managers can face problems rooted in cultural differences. Companies entering unfamiliar markets often hire local agencies to perform their market research for them. Local researchers know the cultural train: they understand, which practices are acceptable; which types of questions can be asked; and how to interpret information gathered and its reliability.
Secondary international data
The process of obtaining information that already exist within the company or that can be obtained from outside sources is called secondary market research.
International organizations are excellent sources of free and inexpensive information about demand for product in a particular country. International development agencies, such as the World Bank and the International Monetary Fund, also provide valuable secondary data. Government agencies -- commerce departments in international trade agencies of most countries -- often have information on import export regulations, quality standards, and the size of the markets. Commercial agencies of many state and provinces often have offices in other countries to promote trade and investment.
Companies often join industry and trade associations composed of firms within their own industries or trades. The publications of these organizations help members to keep abreast of important issues and opportunities. Many international service organizations in fields such as banking, insurance, management consulting, an accounting offer information to their clients on cultural, regulatory, and financial conditions and the market.
Main methods to conduct primary international research
Process of collecting and analyzing original data and applying the results to current research needs is called primary market research. However, primary research data are often more expensive to obtain and secondary research data because studies must be conducted in their entirety. Exhibitions at which members of an industry or group of industries showcase their latest products, see what rivals are doing, and learn about recent trends and opportunities are called trade shows. A trade mission is an international trip by government officials and business people. That is organized by agencies of national and provincial governments for the purpose of exploring international business opportunities.
Companies can use interviews to assess potential buyers emissions, attitudes, and cultural beliefs. And unobstructed but in-depth interview of a small group of individuals by a moderator to learn. The group's attitudes about a company or its product is called a focus group. In surveys, interviewers obtain facts, opinions, were attitudes by asking current or potential buyers to answer written or verbal questions. An ongoing process of gathering, analyzing, and dispensing information for tactical or strategic purposes is called environmental scanning.
