COMMERCE 4SA3 Lecture Notes - Lecture 12: Intangible Property, Experience Curve Effects, Workforce Productivity
21 Feb 2017
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Entry modes: strategic factors: cultural environment market size international experience production and shipping costs political/legal environments. No dramatic upsurge (low volatility) in inflation or private-sector debt. (some form of stability: unfavourable. Politically unstable developing nations with a mixed or command economy or where speculative financial bubbles have led to excess borrowing. First-mover advantage pre-empt rivals and capture demand by establishing a strong brand name. Move down experience curve and achieve cost advantage. Create switching costs that tie customers into their products or services which make it difficult for later entrants to win business : disadvantages: Pioneering costs: costs an early entrant bears that later entrant avoid such as the time and effort in learning the rules, failure to ignorance and the liability of being a foreigner. Pioneering costs also includes the costs of promoting and establishing a product offering, costs of educating customers.
