Module 7 Packet - BA 412 International Business

**MODULE 7 PACKET** =================== **BA 412: INTERNATIONAL BUSINESS AND TRADE** **MODULE 7 OVERVIEW**: Welcome to Module 7 --**GLOBAL MARKET PARTICIPATION**! In this module, we will discuss the reasons why firms go International/Global. You are going to differentiate between born-global fir...

**MODULE 7 PACKET** =================== **BA 412: INTERNATIONAL BUSINESS AND TRADE** **MODULE 7 OVERVIEW**: Welcome to Module 7 --**GLOBAL MARKET PARTICIPATION**! In this module, we will discuss the reasons why firms go International/Global. You are going to differentiate between born-global firms and other companies. At the end of this module, you are going to explain the pros and cons of choosing markets on the basis of market similarities. You are now going to identify country in which your locally produced product will be sold. You are set for an incredible journey! Have fun in the world of marketing! **CONSULTATION HOURS**: Phone or Messenger: 3 -- 5:00 PM Wednesdays Virtual time: 11:00 -- 12:00 Monday, Tuesday, Thursday & Friday **MODULE 7 LEARNING OBJECTIVES:** By the end of this module, the students will be able to: 1. List and describe the five reasons why firms internationalize. 2. Differentiate between born-global firms and other companies. 3. Explain the difference between a standalone attractive market and a globally strategic one. 4. Cite the advantages and disadvantages of targeting developed countries, developing countries, or transitional economies. 5. List and describe the filters used for screening national markets. 6. Explain the pros and cons of choosing markets on the basis of market similarity. 7. **COURSE CONTENT FOR MODULE 7:** **INTRODUCTION TO MARKETING FOR HOSPITALITY AND TOURISM** **ACTIVITY** **DESCRIPTION** **TIME TO COMPLETE** -------------------- -------------------------------------------------------- ---------------------- Lecture discussion Types of Internationalization 30 minutes Lecture discussion Evaluating National Market 15 minutes Video Presentation Quick review 15 minutes Lecture discussion Geographic Market Choices 30 minutes Lecture discussion Country Selection 30 minutes Activity Giving instructions for the activity: For Final Output 30 minutes Quiz Summative quiz for module 7 30 minutes **LECTURE DISCUSSIONS** **7.1 Internationalization** -- The term use for a firm's expansion from its domestic market into foreign markets. Whether to internationalize is a strategic decision that will fundamentally affect any firm, including its operation and management. **Types of Internationalization** 1. **Opportunistic expansion**- is an internationalization strategy that is adopted in response to unsolicited orders from overseas customers. ### Here are the top 10 best countries for international expansion in 2024: 2. **Pursuing Potential Abroad and Diversifying risk** -- Perhaps is the most common reason for a company to expand internationally is the lure of increasing sales and profit from entering new market or maybe avoiding risk inherent to operating in only one country. 3. **Exploiting Different Market Growth Rate** -- Companies seeking growth abroad often pay particular attention to market growth rate, which are subject to wide variations among countries. A company based in low-growth country may wish to expand into faster-growing countries to take advantage of growth opportunities. Market Growth, Size, Share and Forecast \[2030\] 4. **Following Customers Abroad** -- For companies, the decision to internationalize may occur when one of its key customers moves abroad to pursue international opportunities. 5. **Born Global** -- it refers to firms that establishes marketing and other business operations abroad upon formation of firms or immediately thereafter. These companies develop their domestic markets and then tentatively enter international markets, usually by exporting. 6. **First-mover Advantage**--A market advantage relating to brand awareness, sales and profit that accrues to the first significant competitor to enter a new market.  **7.2 Evaluating National Market** 1. **Standalone Attractive Market** -- A national market can appear attractive in a number of ways. First, the potential primary market needs to be assessed. Two key considerations are the size of market and its growth rate. Then the firm must consider its possible competitive position. 2. **Globally Strategic Market** -- Are the current and the future battlegrounds where global competitors engage one another. 3. **Lead market Countries** -- those that possess major research and development sites for an industry or recognized for being trend setter. Ex. (What becomes "cool" in Japan often spread to Korea, China and other Asian Countries. (Italy is recognized lead market for high-end textiles and clothing. **7:3 Geographic Market Choices** 1. **Targeting Develop Economies** -- A developed country is defined as a sovereign state that has a developed economy and technologically advanced infrastructure when compared to other nations. Several factors that determine whether or not a country is developed, such as the Human Development Index, political stability, gross domestic product (GDP), industrialization and freedom. 1. Norway 2. Switzerland 3. Ireland 4. Germany 5. Hong Kong, China 6. Australia 7. Iceland 8. Sweden 9. Singapore 10. The Netherlands 2. Targeting Developing Countries - developing country, also called a less developed country or underdeveloped country, is a nation with an underdeveloped industrial base, and a low Human Development Index (HDI) relative to other countries. On the other hand, since the late 1990s developing countries tended to demonstrate higher growth rates than the developed ones. There is no universal, agreed-upon criterion for what makes a country developing versus developed and which countries fit these two categories, although there are general reference points such as a nation\'s GDP per capita compared to other nations. Also, the general term less-developed country should not be confused with the specific least developed country. - - https://upload.wikimedia.org/wikipedia/commons/thumb/9/9a/Flag\_of\_Afghanistan.svg/23px-Flag\_of\_Afghanistan.svg.png [Afghanistan](https://en.wikipedia.org/wiki/Afghanistan) -  [Albania](https://en.wikipedia.org/wiki/Albania) - https://upload.wikimedia.org/wikipedia/commons/thumb/7/77/Flag\_of\_Algeria.svg/23px-Flag\_of\_Algeria.svg.png [Algeria](https://en.wikipedia.org/wiki/Algeria) -  [Angola](https://en.wikipedia.org/wiki/Angola) - https://upload.wikimedia.org/wikipedia/commons/thumb/8/89/Flag\_of\_Antigua\_and\_Barbuda.svg/23px-Flag\_of\_Antigua\_and\_Barbuda.svg.png [Antigua and Barbuda](https://en.wikipedia.org/wiki/Antigua_and_Barbuda) -  [Argentina](https://en.wikipedia.org/wiki/Argentina) - https://upload.wikimedia.org/wikipedia/commons/thumb/2/2f/Flag\_of\_Armenia.svg/23px-Flag\_of\_Armenia.svg.png [Armenia](https://en.wikipedia.org/wiki/Armenia) -  [Azerbaijan](https://en.wikipedia.org/wiki/Azerbaijan) - https://upload.wikimedia.org/wikipedia/commons/thumb/9/93/Flag\_of\_the\_Bahamas.svg/23px-Flag\_of\_the\_Bahamas.svg.png [Bahamas](https://en.wikipedia.org/wiki/The_Bahamas) -  [Bahrain](https://en.wikipedia.org/wiki/Bahrain) - https://upload.wikimedia.org/wikipedia/commons/thumb/f/f9/Flag\_of\_Bangladesh.svg/23px-Flag\_of\_Bangladesh.svg.png [Bangladesh](https://en.wikipedia.org/wiki/Bangladesh) -  [Barbados](https://en.wikipedia.org/wiki/Barbados) - https://upload.wikimedia.org/wikipedia/commons/thumb/8/85/Flag\_of\_Belarus.svg/23px-Flag\_of\_Belarus.svg.png [Belarus](https://en.wikipedia.org/wiki/Belarus) -  [Belize](https://en.wikipedia.org/wiki/Belize) - https://upload.wikimedia.org/wikipedia/commons/thumb/0/0a/Flag\_of\_Benin.svg/23px-Flag\_of\_Benin.svg.png [Benin](https://en.wikipedia.org/wiki/Benin) -  [Bhutan](https://en.wikipedia.org/wiki/Bhutan) - https://upload.wikimedia.org/wikipedia/commons/thumb/4/48/Flag\_of\_Bolivia.svg/22px-Flag\_of\_Bolivia.svg.png [Bolivia](https://en.wikipedia.org/wiki/Bolivia) -  [Bosnia and Herzegovina](https://en.wikipedia.org/wiki/Bosnia_and_Herzegovina) - https://upload.wikimedia.org/wikipedia/en/thumb/0/05/Flag\_of\_Brazil.svg/22px-Flag\_of\_Brazil.svg.png [Brazil](https://en.wikipedia.org/wiki/Brazil) -  [Brunei](https://en.wikipedia.org/wiki/Brunei) - https://upload.wikimedia.org/wikipedia/commons/thumb/9/9a/Flag\_of\_Bulgaria.svg/23px-Flag\_of\_Bulgaria.svg.png [Bulgaria](https://en.wikipedia.org/wiki/Bulgaria) -  [Burkina Faso](https://en.wikipedia.org/wiki/Burkina_Faso) - https://upload.wikimedia.org/wikipedia/commons/thumb/8/8c/Flag\_of\_Myanmar.svg/23px-Flag\_of\_Myanmar.svg.png [Burma](https://en.wikipedia.org/wiki/Myanmar) -  [Burundi](https://en.wikipedia.org/wiki/Burundi) - https://upload.wikimedia.org/wikipedia/commons/thumb/8/83/Flag\_of\_Cambodia.svg/23px-Flag\_of\_Cambodia.svg.png [Cambodia](https://en.wikipedia.org/wiki/Cambodia) -  [Cameroon](https://en.wikipedia.org/wiki/Cameroon) - https://upload.wikimedia.org/wikipedia/commons/thumb/3/38/Flag\_of\_Cape\_Verde.svg/23px-Flag\_of\_Cape\_Verde.svg.png [Cape Verde](https://en.wikipedia.org/wiki/Cape_Verde) -  [Central African Republic](https://en.wikipedia.org/wiki/Central_African_Republic) - https://upload.wikimedia.org/wikipedia/commons/thumb/4/4b/Flag\_of\_Chad.svg/23px-Flag\_of\_Chad.svg.png [Chad](https://en.wikipedia.org/wiki/Chad) -  [Chile](https://en.wikipedia.org/wiki/Chile) - https://upload.wikimedia.org/wikipedia/commons/thumb/f/fa/Flag\_of\_the\_People%27s\_Republic\_of\_China.svg/23px-Flag\_of\_the\_People%27s\_Republic\_of\_China.svg.png [China](https://en.wikipedia.org/wiki/China) -  [Colombia](https://en.wikipedia.org/wiki/Colombia) - https://upload.wikimedia.org/wikipedia/commons/thumb/9/94/Flag\_of\_the\_Comoros.svg/23px-Flag\_of\_the\_Comoros.svg.png [Comoros](https://en.wikipedia.org/wiki/Comoros) -  [Democratic Republic of the Congo](https://en.wikipedia.org/wiki/Democratic_Republic_of_the_Congo) - https://upload.wikimedia.org/wikipedia/commons/thumb/f/f2/Flag\_of\_Costa\_Rica.svg/23px-Flag\_of\_Costa\_Rica.svg.png [Costa Rica](https://en.wikipedia.org/wiki/Costa_Rica) -  [Côte d\'Ivoire](https://en.wikipedia.org/wiki/Ivory_Coast) - https://upload.wikimedia.org/wikipedia/commons/thumb/1/1b/Flag\_of\_Croatia.svg/23px-Flag\_of\_Croatia.svg.png [Croatia](https://en.wikipedia.org/wiki/Croatia) -  [Djibouti](https://en.wikipedia.org/wiki/Djibouti) - https://upload.wikimedia.org/wikipedia/commons/thumb/c/c4/Flag\_of\_Dominica.svg/23px-Flag\_of\_Dominica.svg.png [Dominica](https://en.wikipedia.org/wiki/Dominica) -  [Dominican Republic](https://en.wikipedia.org/wiki/Dominican_Republic) - https://upload.wikimedia.org/wikipedia/commons/thumb/e/e8/Flag\_of\_Ecuador.svg/23px-Flag\_of\_Ecuador.svg.png [Ecuador](https://en.wikipedia.org/wiki/Ecuador) -  [Egypt](https://en.wikipedia.org/wiki/Egypt) - https://upload.wikimedia.org/wikipedia/commons/thumb/3/34/Flag\_of\_El\_Salvador.svg/23px-Flag\_of\_El\_Salvador.svg.png [El Salvador](https://en.wikipedia.org/wiki/El_Salvador) -  [Equatorial Guinea](https://en.wikipedia.org/wiki/Equatorial_Guinea) - https://upload.wikimedia.org/wikipedia/commons/thumb/2/29/Flag\_of\_Eritrea.svg/23px-Flag\_of\_Eritrea.svg.png [Eritrea](https://en.wikipedia.org/wiki/Eritrea) -  [Ethiopia](https://en.wikipedia.org/wiki/Ethiopia) - https://upload.wikimedia.org/wikipedia/commons/thumb/b/ba/Flag\_of\_Fiji.svg/23px-Flag\_of\_Fiji.svg.png [Fiji](https://en.wikipedia.org/wiki/Fiji) -  [Philippines](https://en.wikipedia.org/wiki/Philippines) - https://upload.wikimedia.org/wikipedia/en/thumb/1/12/Flag\_of\_Poland.svg/23px-Flag\_of\_Poland.svg.png [Poland](https://en.wikipedia.org/wiki/Poland) 3. 4. Targeting Transnational Economy- While most of the top emerging markets are tradition developing countries, Russia and Poland are intermediate economies from the former Soviet Bloc. 5. Targeting BRIC -- (Brazil, Russian, India and China), These four countries represent very large emerging market. The growth rate of their economies increase by 3% in early 1990's and 7% in 2009. These are countries believed to be the future dominant suppliers of manufactured goods, services, and raw materials by 2050. China and India will become the world\'s dominant suppliers of manufactured [goods](https://www.investopedia.com/terms/c/capitalgoods.asp) and services, respectively, while Brazil and Russia will become similarly dominant as suppliers of raw materials. As of 2010, South Africa joined the group, which is now referred to as BRICS. 7.4 **Country Selection** 1. The screening Process Macro indicators -- a data is useful in estimating the total market size of a country or region. Criteria for Selecting Target Country 1. Market Size and Growth 2. Political Condition 3. Competition 4. Market Similarity (Psychic distance -- the perceived degree of similarity between countries. 2. Listing Selection -- A good way to screen countries is to develop a set of criteria that serve as minimum standard that a country must meet in order to order or move through the screening processes. 3. Group international Market