Entering Target Markets

The term export means shipping the goods and services out of the port of a country. The seller of such goods and services is referred to as an "exporter" who is based in the country of export whereas the overseas based buyer is referred to as an "importer". In International Trade, "exports" refers to selling goods and services produced in the home country to other markets. ( Wikipedia )

Terminology introduced

• A market entry strategy is the planned method of delivering goods or services to a new target market and distributing them there. ( Wikipedia )

• Foreign direct investment (FDI) is a direct investment into production or business in a country by an individual or company of another country, either by buying a company in the target country or by expanding operations of an existing business in that country. Foreign direct investment is in contrast to portfolio investment which is a passive investment in the securities of another country such as stocks and bonds. ( Wikipedia )

• In many disciplines a greenfield is a project that lacks any constraints imposed by prior work. The analogy is to that of construction on greenfield land where there is no need to work within the constrains of existing buildings or infrastructure. ( Wikipedia )

• A greenfield investment is the investment in a manufacturing, office, or other physical commerce-related structure or group of structures in an area where no previous facilities exist. ( Wikipedia )

• Mergers and acquisitions (abbreviated M&A) are both an aspect of corporate strategy, corporate finance and management dealing with the buying, selling, dividing and combining of different companies and similar entities that can help an enterprise grow rapidly in its sector or location of origin, or a new field or new location, without creating a subsidiary, other child entity or using a joint venture. Mergers and acquisitions activity can be defined as a type of restructuring in that they result in some entity reorganization with the aim to provide growth or positive value. ( Wikipedia )

From a legal point of view, a merger is a legal consolidation of two companies into one entity, whereas an acquisition occurs when one company takes over another and completely establishes itself as the new owner (in which case the target company still exists as an independent legal entity controlled by the acquirer). ( Wikipedia on distinction between merger and acquisition from w:mergers and acquisitions )

• A joint venture (JV) is a business agreement in which the parties agree to develop, for a finite time, a new entity and new assets by contributing equity. They exercise control over the enterprise and consequently share revenues, expenses and assets.

There are other types of companies such as JV limited by guarantee, joint ventures limited by guarantee with partners holding shares. ( Wikipedia )

• Consolidation of an industry or sector occurs when widespread M&A activity concentrates the resources of many small companies into a few larger ones, such as occurred with the automotive industry between 1910 and 1940. ( Wikipedia on Mergers and acquisitions )

Exam picks

Export entry modes

Export modes - Indirect exporting vs. direct exporting own exporting

Q: What kind of intermediaries can help the company to export? How?

• Export Agents
• Export Management Companies
• Export Trading Companies
• Export Merchants
• Association with Another Exporter

• What is the main difference between agent and distributor?

• An agent is someone who acts on your behalf. Although an agent may arrange a sale, the sale contract will be between you and the customer. An agent may be either an employee or self-employed.
• A distributor is a customer of yours. The distributor then sells the product on to the distributor’s own customers.