Choosing an Appropriate Mode of Entry:

The local business we have chosen is Aarong. We have taken Aarong’s GIFT & CRAFT

segment for entering into Canada’s market. We believe that the most appropriate mode of entry

for the sale of Aarong’s product will be exporting. Since exporting is a traditional and less risky

method of reaching foreign markets, it will be easiest way to enter Canada’s foreign market.

Relatively setting up a business and operating it in Canada will cost more than it will be in

Bangladesh as Bangladesh has cheaper labor than in Canada. So Bangladesh compared to

Canada has a significantly lower cost of manufacturing operations. Hence in the beginning all we

want to do is export as it will help us avoid the cost of setting up & running the business in

Canada. With more & more experience in manufacturing for a more demanding, diverse market

we hope to go down the experience curve rather smoothly & realize location economies. Canada

encourages globalization & international business so the trade barriers will not cost us much &

as for transports costs, we will begin by transporting through the sea routes using sea freights,

shipping containers which relatively cheap. With rising demand and a good rate of profitability,

we might even move to transporting via air freights.

Having all that said, our only concern is regarding our Canadian agents who might not act

accordingly to our best interests, for that reason, we plan to use our connections in Canada to

hire a team of trust worthy employees who will oversee the smooth operations of exports and

distributions in Canada. All in all, we believe that this will the best mode of entry for us in our

current state. However, on analyzing the responses from the Canadian market, we may then

move to Greenfield operation after reaching a certain point when we will realize that we should

enter in a large scale. By establishing Greenfield operation, it will give high level of control over
the business operations, high control over the brand image and staffing, bypassing trade

restrictions.