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The single most important cause for failure in international

business is insufficient preparation and information
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¦ The failure of managers to comprehend cultural
disparities, the failure to remember that
customers differ from country to country, and the
lack of investigation into whether or not a market
exists prior to market entry has made
international business a risk activity

¦ Differences between domestic and international

research::
research
a) new parameters (duties, foreign currencies,
international documentation)
b) new environmental factors (legal issues, cultural
issues, political issues, technological level of the
society)
c) The number of factors involved
d) Broader definition of competition (much greater
variety of competition)
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¦ pack of sensitivity to differences in culture,

consumer tastes, and market demands

¦ pimited appreciation for the environment (pabour

rules, distribution systems, the availability of
media, or advertising regulations)

¦ pack of familiarity with national and international

data sources and inability to use international data
once obtained

Research allows management to identify and develop

international strategies (identification, evaluation, and
comparison of potential foreign business opportunities
and subsequent target-
target-market selection)
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Research is necessary for the development of a business
plan that identifies all the requirements necessary for
market entry, market penetration, and expansion

Research provides the feedback needed to fine-

fine-tune
various business activities

Research can provide management with intelligence to

help anticipate events, take appropriate action, and
adequately prepare for global changes.
changes.

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bjectives will vary depending on the views of
management,the corporate mission of the firm, the
firmƍs level of internationalization, and its competitive
situation..
situation

oing cnternational Ɗ xporting

xporting;; ursory of general
variables of a country, including total and per capita
, population figures
figures.. hese details will enable the
researcher to determine whether corporate objectives
might be met in the market.
market.

ext tep, the researcher will require information on

each individual country for a preliminary evaluation.
evaluation.

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Third, selection of appropriate market for in
in--depth
evaluation

Fourth, a competitive assessment needs to be made,

matching markets to corporate strengths, and providing
an analysis of the best potential for specific offerings

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ypically the information requirements will cover both
macro information about countries and trade as well as
micro information specific to the firmƍs activities

Most critical cnternational cnformation for . . firms:

firms:

) Macro data:
data: tariff cnformation, . . export/import
data, nontariff measures, foreign export/import
data;; and data on government trade policy
data

B) Micro ata
ata:: pocal paws and egulations, ize of the
market, local standards and specifications,
distribution system, and competitive activity.
activity.

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c) Sources of Secondary Data
Data::

US overnment: Department of ommerce

International
gencies: United ations-
ations-UNCTAD, orld
Bank, IMF
Service rganizations: Banks, Accounting Firms,
foreign Research firms, freight forwarders
Trade Associations: American Chamber of Commerce
Directories and Newsletters
Databases: on-
on-line interactive delivery, read-
read-only
memory

Secondary data should be evaluated regarding the

quality of their source, their recency, and their
relevance to the task at hand.

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ypically primary research intends to answer such clear
clear


cut questions as:
as:

hat is our sales potential, how skilled is the labour

force, what will happen to demand if we raise the price
by 10%
10%? hat effect will a new type of packaging have
on our sales?

etermining the esearch echnique

echnique:: election of the
research technique depends on a variety of factors
factors::

‰ bjectivity of data, unstructured data, data collected

in real world or controlled environment, historical
facts or information on future developments

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‰ Interviews

‰ Surveys must pay attention to cultural differences

‰ Focus Group (Collective Interviews)

‰ Observation

‰ Environment Scanning:
Scanning: necessity for tracking
developments in the environment.
environment. Environmental
scanning activities provide continuous information
on political, social, and economic affairs
internationally;; on changes of attitudes of public
internationally
institutions;; and private citizens;
institutions citizens; and on possible
upcomings..
upcomings

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 ‰ Typically, environmental scanning is designed
primarily to aid the strategic-
strategic-planning process rather
than the tactical activities of the corporation

Delphi Studies
Studies:: A means for aggregating the
information of a group of experts
experts.. Typically, Delphi
Studies are carried out with groups of about 30 well-
well-
chosen participants who possess expertise in an area of
concern such as future developments of the
international trade environment.
environment.

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