Foreign market entry strategies : a case study for a Chinese pump manufacturer

University essay from Högskolan i Gävle/Akademin för teknik och miljö

Abstract:

Economic globalization, regional economic cooperation and knowledge economy make a great impact on the development of the new century. The changes of international trade and investment reflect the variety of the world economy development; the world economic development, in turn, influences the international trade and investment in both quality and quantity (Feenstra, 1998). The international marketing has become an important trend in this modern society, global strategy has been put at the top of the agenda of many companies. And making development in the international market can also be a good solution for the companies to increase their competition (Mittelman, 1996). It is vital for those companies to deal with foreign market entry as a first step in accomplishing their global mission (Onkvisit & Shaw, 2004).  How to enter a foreign market is very important in this case, so the purpose of this work is therefore to research important factors on entering a foreign market. The theories, including environmental assessment before entry and foreign market entry strategies, are summarized by literature review and in order to make the theories applicable, a case study on a company inChinahas been done in this work as well. The methods used in this work include collecting processed data from literature review, gathering primary data by telephone interviews and through e-mails. SWOT analysis is used to assess targeted market for the case company. The case company is Shandong Shuanglun Group which is a famous pump manufacturer inChina; its targeted market that the company wants to enter is the Italian market. After SWOT analysis, the conclusion of this work indicated that opportunities of entry targeted market for the case company includes favorable tax policies and relevant laws, the threats in high context culture and terrorist activities should be paid attention to. The company has strengths in product but weaknesses in service, strategic alliance with one local pump manufacturer and exporting could be their market entry modes.

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