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GMS 522 Chapter 6 Modes of Market Entry
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  • Planning and execution of an international venture must be incorporated into the firms strategic management process
  • Proactive motivations: profit advantage, unique product technological advantages, exclusive information, managerial urge, tax benefit, economies of scale
  • Reactive motivations: competitive pressure, overproduction, declining domestic sales, excess capacity, saturated domestic market, proximity to customers and ports 

 

Psychological distance: cultural variables, legal factors, other societal norms make a foreign market that is geographically close seen psychologically distant . Example: US and Canada vs. US and Mexico

  • Two major issues in the context of psychological distance
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