SME’s Entry Process in Emerging Markets- A case study of the Nordgröna AB entering Chinese Market

Abstract: In the process of internationalization, Small and Medium enterprises (SME’s) will be confronted with various challenges when entering in developing markets, such as culture differences, localization issues and financial problems. The research is aimed at creating a market entry framework to capture the target population in emerging countries, particularly in the group of middle class, in order to expand market share and gain more profits. Specifically,the research questions can be discussed through mainly two perspectives. From the external environment, SME’s would research host market situation and assess opportunities through customer behavior, competitor analysis, distribution assessment, economic analysis, regulatory evaluation (phase 1), market attractiveness and ease of entry (phase 2). Then, from the internal side, market strategies would be built up through tools, including segmenting, targeting,positioning (STP) and marketing mix (4P’s) on the basis of external factors (phase 3). Finally,combining the external and internal aspects companies can develop a market plan for implementation and control process for market execution (phase 4). In the research method section, the authors apply an instrumental case study to exemplify how the company wins market share over competitors in China through a systematic procedure and empirical statistics, which consists of questionnaires and semi-structured interviews. After that, a suitable market strategy would be developed for the company to enter into the emerging market, such as China. Through the procedure, market entry strategy has been applied as a framework for the SME’s, by using different marketing tools to understand consumer behavior and market demands so as to assist the company to enter into the local market successfully. Moreover, under similar situations, the summarized market entry process could also be generalized for other SME’s in the progress of internationalization in emerging markets.