As technology continues to evolve, business owners are asking how can entering foreign markets become easier? While some entrepreneurs may wish to enter foreign markets on a large scale, this is often cost-prohibitive and can be risky financially should your company fail. On the other hand, smaller companies that enter foreign markets on a small scale can have limited risks and provide a greater chance to gain attention from potential customers and local businesses.
Entering foreign markets is a complex process that involves many different considerations. Some of the most important factors include the size of the market and its growth potential as well as the company’s resources available. For example, a large company with significant resources may be more likely to invest in a wholly owned subsidiary rather than an outsourcing arrangement.
Another factor is the level of local embeddedness a firm wishes to achieve in foreign markets. For example, single-sided platforms like clothing firms or streaming services require a low level of local embeddedness while multi-sided platforms that rely on contributions from local complementors may need to develop greater levels of local embeddedness.
The transforming winds of globalization have proletarianized communication, travel, and the economies of scale of raw materials and manufactured goods. The resulting global market for standardized consumer products offers corporations enormous economies of distribution, sales, and marketing. This is a new commercial reality that does not discriminate between isolated places and impoverished peoples eager for modernity’s allurements.