...SMES' MARKET ENTRY STRATEGY: SUBSTITUTION INSTEAD OF NICHING Guan H Lim, Khai S Lee and Soo J Tan Abstract Existing research seems to suggest that the obvious strategy choice for SMEs, given the fact that they do not have plentiful resources, is to is to seek market niches. However, the very fact that SMEs do not have plentiful resources may mean that they would not be able to niche successfully beyond the short term. The bigger firms who have initially neglected the niches may try to wrestle the niche away from the SMEs, especially if the SMEs have successfully developed the market into a size that is sufficiently big and profitable. A better strategy choice for the SMEs might be to offer products/services that are substitutable to, but differentiated from, that offered by the incumbent bigger firms. This paper, through the use of deductive logic and actual case examples, shows why a substitution strategy might indeed be a better strategic choice for the SMEs. Introduction Conventional wisdom (see for examples Perry, 1987; Waterworth 1987; and Kotler, 1996) suggests that niching is the strategy choice of SMEs given that SMEs have limited resources. They do not have plentiful financial resources, and very often are also short on manpower especially those with the necessary managerial skills and marketing expertise. However, it is this very lack of resources that may impede the SMEs' ability to niche successfully and sustain its market entry in the long run This is because, in...
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...(Business Monitor International, 2006). As a result, China's SMEs are now facing an economy flooded with foreign capital, and with a more open economic climate than in previous years, but also a much more competitive economy, where many of their previous practices are no longer relevant. This piece aims to examine the effect of these changes on the strategies of Chinese SMEs by first examining the role of the SME in the economy, then analysing the strengths and weaknesses of the Chinese SMEs, and the opportunities and threats that have arisen from China's WTO membership. The piece will then examine Chinese SMEs from a strategic perspective, and the impact the the WTO membership has had on said strategies. Finally, the piece will give strategic recommendations for Chinese SMEs that wish to take advantage of the opportunities that WTO membership offers, and also for those SMEs that wish to avoid the challenges it poses. The Role of SMEs in both the International Perspective and the Chinese Perspective Academics have long realised that small and medium enterprises grow to become the major corporations and businesses of the future (Davis et al., 1985). As a result of this view, greater attention has been given to the role of small and medium sized enterprises (SMEs) in contributing to the economic growth of countries over the past twenty years in countries all over the world. Due to the importance of the role that SMEs play, for the last 15 years governments have urged by academics...
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...Internationalization of SMEs Overview: 1. Introduction 2. Motivation for Internationalization of SMEs 3. Strategies for Internationalization of SMEs 4. Risks and Opportunities 5. Internationalization of SMEs – Best approach 6. Conclusion 7. References Introduction In Europe companies with less than 10 employees are considered to be micro-firms, those with less than 50 employees are small-firms and those with less than 250 employees are considered as medium-firms. In the US however the size of small firms sums up to 100 employees and medium sized firms may have less than 500 employees. SMEs are key actors in the world economy because they are an important part of GDP and play a big role for employment. Since today’s world becomes more and more globalized it is important that firms can compete on an international level. Big enterprises often choose to internationalize their business but for them this process mostly isn’t as risky as for SMEs, because while big firms may lose parts of their firm budget if something goes wrong, SMEs have to fight for their existence and may disappear at all if they choose a wrong approach of internationalizing. Usually small start-up companies do not survive longer than the first 5 years therefore it is very important for SMEs to take the right steps in order to become successful. Motivations for Internationalization of SMEs There are different types of motivations for going international. These are...
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...A Report on Foreign Market Entry Strategy: The case of Crimson Tide Plc Global Marketing Masters in Business Administration Word count excludes tables, figures, abstract, bibliography and appendix Glenworth M Joseph A4046741 Page i of 28 A Report on Foreign Market Entry Strategy: The case of Crimson Tide Plc Table of Contents Executive Summary ........................................................................................................................................................... iii 1 1.1 Introduction ............................................................................................................................................................... 1 Crimson Tide..................................................................................................................................................... 1 1.1.1 1.1.2 1.1.3 1.2 2 2.1 3 3.1 3.2 3.3 4 5 5.1 6 7 8 8.1 9 9.1 9.2 9.3 9.4 9.5 10 11 12 Core business and performance ............................................................................................................ 1 History of the company.......................................................................................................................... 1 Target Market and Competitors ............................................................................................................ 1 Going Global.....................................................................................................
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...Market Entry Mode Naveed Hussain Malik (naveed.hm@gmail.com) 770325-3059 Masood Hussain Chudary(zindagi03@hotmail.com) 801014-5855 Supervisor: Eva Wittbom Masters Degree Thesis in Business Administration School of Management Sciences Date of submission Abstract Development in infrastructure limits the communication gap, speedy travel and low cost tariff barriers as well other drivers of globalization have made overseas markets easier to get small firms and gave more opportunities to SME´s internationalize. The market entry mode choice or selections have strong effect the success or failure of the company. For instance an insufficient or wrong entry mode selection can decrease opportunities and limit important choice for the firm and could lead to high financial loss as well as lose control on overseas market. The purpose of research study is to provide a deep and better understanding of the factors those effecting SME´s selection of market entry mode. Research question how can the influence of internal and external factors on the selection of market entry mode. A frame of reference led to the building of summary which in turn became the basis for data collection. Two qualitative case studies for Pakistani SME´s namely socks knitter Pakistan and RK International were undertaken. The main findings shows the clear link between the theories claim to be internal and external factors influencing market entry mode choice between SME´s. ...
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...ACKNOWLEDGMENT First and foremost, I would like to thank the almighty God for giving me wisdom and understanding to successful accomplish the proposal. I thank Him for the great mind He has given to me no forgetting the good health and capability to attend the University. Also, I am thankful to my supervisor who took me through the proposal step by step and correcting me until I successfully finished it. He was patient with me throughout the whole experience. I am thankful for the knowledge he impacted in me and guiding me well. TABLE OF CONTENTS DECLARATION i DEDICATION ii ACKNOWLEDGMENT iii ABSTRACT vi INTRODUCTION 1 1.1 Background to the study 1 1.2 Michael Porters’ five forces model 2 1.3 Top 100 SMEs in Kenya 2 1.4 Profile of the selected SMES 3 1.5 Problem statement 5 1.6 Research objectives 5 General objective 5 Specific objectives 5 1.7 Research questions 5 1.8 Scope of the study 6 1.9 Significance of the study 6 CHAPTER TWO 7 LITERATURE REVIEW 7 2.1 Introduction 7 2.2 Overview of the five forces 7 2.3 Michael Porter’s five forces model 8 2.4...
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...Selected Thesis Topics for BScBA students Bachelor´s Thesis 2013-2014 Please use this list of the fields of International Business for thesis work and potential thesis topics when choosing and informing us the field of your thesis + the thesis topic in the form Indication of Interest Area for Thesis 2013-2014. Part 1. Thesis topics for companies and other organizations We have first listed the thesis projects that are available to do for companies and organizations. If you are interested in these projects, please mark the topic to the Indication of Interest Area form the same way than any other topic. It should be noted that the students selected to do the thesis from these topics must be motivated and committed for the work. Please do not contact these organizations yourself before the selection process has been completed for all students. More information on topics can be asked from Mari Syväoja or Tomi Heimonen. Organization: Thesis Biofenno projects for (www.biofenno.fi) companies and organizations Selected Thesis Topics for companies and organizations Internationalization plan Plan how to take and promote product Tuovi Tuotevirtakirjanpito to EU markets. Tuovi Tuotevirtakirjanpito is a stock and feed recording program for organic farmers. It produces necessary stock and feed reports for annual inspection. Also stock balance reporting benefits farm managements. Because Tuovi Tuotevirtakirjanpito complies with all the regulations EU has set for organic farmers, it has...
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...International Management Part 1: The Global Manager’s Environment Part 2: The Cultural Context of Global Management Part 3: Formulating Strategy Part 4: Global Human Resources Management The University of Western Australia Strategic Planning and Strategy Strategic Planning • The process by which a firm’s managers evaluate the future prospects of the firma and decide on appropriate strategies to achieve long-term objectives Strategy • The basic means by which the firm competes., that is, its choice of business or businesses in which to operate and the ways in which it differentiates itself from its competitors 63 How does globalisation, risk, political-legal-ethical and culture affect the value chain that a firm manages and operates to create ‘value’ = strategic planning +strategy = STRATEGIC FIT between ‘inputs’ and ‘outputs’ Porter, M (1985) Competitive Advantage: creating and sustaining superior performance. NY: Free Press The University of Western Australia Steps in Developing International and Global Strategies Mission and Objectives Environmental Assessment and Scanning (PEST, PESTEL, Risk) Internal and Competitive Analysis (SWOT) Global Integrative and Entry Strategy Alternatives (Export, JV, Strategic Alliance, CAGE) Strategic Choice, Implementation, Feedback, and Control (Governance) Copyright ©2014 Pearson Education Realize that much of international business is conducted through strategic alliances...
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...Summary: The article focuses on the analysis of the similarities and differences of the internationalization processes and strategies among Norwegian and Lithuanian SMEs (small and medium sized enterprises). Therefore R. Korsakiene and M. Tvaronaviciene mention some general internationalization models and theories of SMEs like the stage approach, foreign direct investment theory or the network approach. The following chapter describes the link between internationalization and entrepreneurship which leads to a definition of international entrepreneurship as “the discovery, evaluation, and explotion of opportunities across national borders” (McDougall, Oviatt 2005). Afterwards the authors introduce different motives and barriers of internationalization as well as factors that influence the foreign market selection and modes of entering new markets. To prove the stated characteristics the authors did a study using questionnairs which were sent to firms in Lithuania and Norway. As a result the authors get insights which internal and external motives and barriers as well as foreign market selection criterias and operational modes are most relevant for Norwegian and Lithuanian SMEs. There were many similarities among both countries like the “small domestic market” as a motive to expand their operations toward foreign markets as well as too much bureaucrarcy as one of the main barriers to enter new markets. On the other hand the authors found also differences, especially when it comes...
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...Identification of Local SMEs’ Development Barriers in Food Service Industry in KSA, the Western Province (2012) Identification of Local SMEs’ Development Barriers in Food Service Industry in Kingdom of Saudi Arabia (KSA), The Western Province (2012) By/ Reham H. Al Zahrani Abstract This paper examines the actual situation of SMEs performing in local food service industry in Kingdom of Saudi Arabia (KSA). It focuses basically on critical issues that disturb the development of local SMEs. The adopted theoretical framework is SME’s vicious cycle in which all enterprise’s factors are to be investigated. The results were collected from 19 enterprises which are mainly located in the most vivid economic cities in the western province in KSA. The most crucial barriers identified in this research are labor-related issues, product quality issues, governmental issues, marketing issues, business regulation issues, financial issues, competition issues, and technological issues. Finally, the paper provides some recommendations to overcome or minimize the influence of these constraints in order to empower SMEs in Saudi restaurants industry to grow and reach their ultimate potentials. Key Words: SMEs, barriers, Saudi, KSA, Food Service Industry, Restaurants, development, growth. 1 Identification of Local SMEs’ Development Barriers in Food Service Industry in KSA, the Western Province (2012) Introduction Food service industry is one of the most active and productive industry...
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...Handbook on Islamic SME Financing Islamic Banking Department State Bank of Pakistan The Team Name Designation Contact Mr. Pervez Said Director Pervez.Said@sbp.org.pk Mr. Imran Ahmad Senior Joint Director Imran.Ahmad@sbp.org.pk Ms. Fatima Javaid Regulating Officer Fatima.Javaid@sbp.org.pk TABLE OF CONTENTS S.No 1 2 3 4 5 6 Background Introduction Prudential regulations for SME Financing Importance in light of Strategic Plan for Islamic Banking Industry Scope of Islamic Banking over Conventional Banking in current Financial crises Proposed Products for Islamic SME Financing Need for Risk Management 7 Murabaha Financing Transaction Structure Accounting Treatment Risk Management 12 12 15 15 18 20 18 21 24 25 26 27 29 30 31 31 33 34 35 35 38 39 40 PARTICULARS Page No. 1 2 4 9 11 8 Ijarah Based Financing Basic Rules Accounting Treatment Risk Management 9 Salam Based Financing Basic Rules Accounting Treatment Risk Management 10 Diminishing Musharaka Basic Transaction Structure Accounting Treatment Risk Management 11 Istisna Financing Flow of Transaction Accounting Treatment Risk Management 12 Project Financing Handbook On Islamic SME Financing BACKGROUND One of the important characteristics of a flourishing and growing economy is a blooming SMEs sector. Small and medium enterprises play an important role in the development of a country. SMEs contribute to economic growth in various ways like...
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...INTERNATIONAL MARKETING CHAPTER 1 – GLOBAL MARKETING IN THE FIRM Globalization – Reflects the trends of firms buying, developing, producing and selling products and services in most countries of the world Comparison of the Global Marketing and Management style between SMEs and LSEs * Resources (Financial, Business Education) * Formation of Strategy * Organization * Risk-taking * Flexibility * Economies of Scale and Scope * Use of information sources Economies of Scope – Reusing a resource from one business in additional businesses Should the company stay home or go abroad? * Industry Globalism. Mainly determined by the international marketing environment * Preparedness for Internationalization. Dependent on the firm`s ability to carry out strategies in the international marketplace, that is the actual skills in international business operations Development of the Global Marketing concept The form of the firm´s response to global market opportunities depends greatly on the management´s assumptions and beliefs about the nature of doing business around the world: * Ethnocentric - Home country is superior and their needs are the most relevant * Polycentric (Multidomestic)- Each country is unique and should be targeted in a different way * Geocentric- The firm may offer global products but with local adaptations * Regiocentric- The firm tries to integrate its marketing programme within regions Glocalization- Development...
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...providing an overall analysis of the repayment behavior of the SME loan borrowers of Brac Bank Limited. Before going to the analysis, it is mandatory to know something about the organization, its core products that it offers to its customers; about the SME loan, its classifications and the whole of its process starting from loan sanction to recovery and closing of the loan. That’s why, first of all, I made an overview of the organization, BRAC bank Limited, where I had completed my internship program. Here I tried to focus the bank’s history of origination, its mission and vision, major departments and business units and major products and services. Then I said something about Asset Operations Department, the department where I was to perform my job responsibility. SME is the next section where I gave my concentration. Here I focused on the terms and conditions of giving SME loan, enterprise selection criteria and documentation. Then talked about the procedure of SME loan where I delineated the sanction, disbursement, repayment and closing of SME loan. After talking about the whole process of SME loan, I made an attempt to analyze the repayment behavior of SME loan borrowers. For this end in view, I have collected information about 20 SME borrowers. Then I have chosen eight major variables which have an impact on the recovery rate of SME loan. That is, these are the variables which may change the repayment behavior of SME borrowers. I found some significant variable like age, experience...
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...INDEX 1. INTRODUCTION 1.1. 1.2. BACKGROUND ENVIRONMENT OF ENTREPRENEURIAL 2. THE IMPORTANCE OF SMEs 3. ROLE OF ENTREPRENEUR 4. ENTREPRENEURSHIP. International 5. INTERNATIONALIZATION PROCESSES. Theories. 5.1. 5.2. UPSALA MODEL. HECKSCHER-OHLIN MODEL 6. THE PROCESS OF INTERNATIONALIZATION 7. ENTREPRENEURIAL MARKETING 7.1. 7.2. 7.3. SWOT ANALYSIS MARKET ENTRY STRATEGY COOPERATION STRATEGY 8. TARGET COUNTRY 9. GEM 10. GOVERNMENT SUPPORT 11. CONCLUSION 12. RECOMMENDATIONS 13. REFERENCES 1. INTRODUCTION: For this work I decided to open in France Cocoon clothing company, located in Granada, retailing, I have chosen these two countries because they are within the top 5 countries of the European Union in the textiles sector and are two major countries with major fashion catwalks. I chose this company because it is a small company, and is a women's clothing store that has clothes very hard to find in other stores. I chose the fashion industry especially because according to my previous studies I think it's an everchanging industry in terms of fashion and is an area in which the image is very important in Spain. Cocoon is a shop that sold clothing especially at night but you can also find jeans, skirts, blouses, accessories, handbags and more clothing at prices that will chord with our product quality. Cocoon is a very experienced workers and always try to help the customer find what you want, is a company with more than 16 years of experience in this sector. 1.1...
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...TABLE OF CONTENTS Page INTRODUCTION …..…………………………………….……………………… 1 PART 1 PORTER’S NATIONAL DIAMOND ANALYSIS ……………… 1.1 Factor Conditions 2 1.2 Demand Conditions 3 1.3 Related and Supporting Industries 4 1.4 Firm Strategy, Structure and Rivalry 5-6 1.5 Government 7 1.6 Chance 8 CONCLUSION ……………………………………………………………………. 9 PART 2 MARKET ENTRY STRATEGIES ……………………………..… 2.1 Joint Venture 10-11 2.2 Acquisition 12-13 RECOMMENDATIONS …………………………………………………………... 14 REFERENCES …………………………………………………………..……….. 15-17 WORD COUNT Part 1: 2310 Part 2: 939 Total: 3249 WORD COUNT Part 1: 2310 Part 2: 939 Total: 3249 INTRODUCTION Peru is a dynamic, fast-growing South American economy poised for success in international markets. Some of Peru’s flagship export products are coffee and asparagus, but in recent years, it is an emerging producer of New World wines. Peru’s wine market supply is around 45 million litres, an increase of almost 10 million litres from five years ago (USDA, 2014). Peruvian climate is ideal for cultivation of grapes with strong character, where majority of its vineyards are concentrated on the Central coast. The wine industry is Peru has promising prospects for a foreign business investment, due to growing domestic consumption and global demand for high-quality and affordable wines. ………... PORTER’S NATIONAL DIAMOND ANALYSIS ……….....
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