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    Factors to keep in mind when entering a new market

    Explain to your Business Development Officer (Peter Brown) who is planning to enter an international market with the current business operations in the U.K., the relevance of the distances – cultural and institutional.

    Factors to keep in mind when entering a new market

    Dear Mr. Brown, 

    There are many reasons and incentives that motivate companies to expand internationally with their operations. However, who simplified the process for them to go global is the technologies that made the world a small place.

    While going global can result in boosting revenue and increasing market share and, nevertheless, diversifying the company market and increasing its exposure to foreign investment opportunities. There are many concerns that a company needs to consider before expanding to a foreign country. 

    Even though we are living in a time where technology and the internet broke the boundaries and distances between countries and nations, there are still boundaries and gaps that cannot be tackled with artificial intelligence or the evolving technologies, but instead, it requires human interaction and emotion. Deciding for an entry into a new market in a foreign country requires a perspective on normative, cognitive, and regulative factors. All those factors present pressures and expectations which entail adjusting strategies and plans,(Ionescu, Meyer & Estrin, 2004).

    Multinational firms should pay the right amount of attention to the differences in the norms and ethics before engaging with a new affiliate in a foreign country. More importantly, they should pay a more significant share of attention to the distinction in the institutional factor such as the laws and regulations since it is harder to cope with these differences (Ionascu, Meyer & Estrin, 2004). Therefore, expanding into countries where the distance in institutional factors is minimized would be a smart decision to implement. In conclusion, the ability to adapt and to cope with changes and the ability to reframe plans and strategies are highly required to shorten the cultural and institutional distances and, thus, to have a successful entry to a foreign market. 

    Bibliography

    Ionascu, D., Meyer, K. E., & Estrin, S. A. U. L. (2004). The concept of ‘‘distance’’in international business—culture, regulation and cognition—and its relevance to multinationals’ entry mode decision. Centre for New and Emerging Markets 

    Retrieved from:

    http://www.academia.edu/2824617/The_Concept_of_Distance_in_International_Business_Culture_Regulation_and_Cognition_and_its_Relevance_to_Multinationals_Entry_Mode_Decision.

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