How can companies evaluate and

select specific foreign markets to

enter?

200+countries
which country to enter

The company must decide how many

countries to enter and how fast to
expand. Typical entry strategies are
the waterfall approach and sprinkler
approach

waterfall approach, gradually

entering countries in sequence

It allows firms to carefully plan

expansion and is less likely to strain
human and financial resources

the sprinkler approach, entering

many countries simultaneously

The main risk is the substantial

resources needed and the difficulty of
planning entry strategies for many
diverse markets.14

The company must also choose the

countries to consider based on the
product and on geography, income
and population,and political climate.

Developed versus Developing Markets

Evaluating Potential Markets

Many prefer to sell to neighboring

countries because they understand
them better and can control their
entry costs more effectively

psychic proximity determines choices.

Given more familiar language, laws,
and culture, many U.S. firms prefer to
sell in Canada, England, and Australia
rather than in larger markets such as
Germany and France.