INTB 1209 Chapter Notes - Chapter 13: A.D. Vision, Switching Barriers, Franchising
4 Apr 2017
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Document Summary
The attractiveness of a country depends on balancing the benefits, risks, and costs. Long run economic benefit is based on size of the market (demographics), present wealth (purchasing power of the individuals), and the likely accumulation of wealth among consumers. Another important factor is the value a business can create in a foreign country. Timing of entry- entry is early if a firm enters a foreign market before other foreign firms and entry is late if the firm enters after foreign firms. First mover advantage- advantages accruing to the first to enter a market (preempt rivals, create switching costs and capture demand) First mover disadvantages- disadvantages with entering a market before other international firms. Pioneering costs- costs that an early entrant bears, and later entrants avoid such as the time and effort to learn the rules, failure due to ignorance, promotion of a product and the liability of being a foreigner.
