5. Identifying and Analyzing Domestic and International Opportunities

Identification And Analyzing Domestic And International Opportunities

Opportunity Recognition And The Opportunity Assessment Plan

Opportunity assessment plan is not a business plan:

1. Be shorter2. Focus on the opportunity, not the venture3. Have no computer-based spreadsheet4. Act or wait on an opportunity

Opportunity Recognition And The Opportunity Assessment Plan

Opportunity assessment plan contain four section: Two major and Two minor sections.

MAJOR SECTIONS:1. first major section: Develops the product/service

idea, analyze the competitive products and companies

Opportunity Recognition And The Opportunity Assessment Plan

MAJOR SECTIONS:1. Second major section: Focus on the market its size, trends,

characteristics, and growth rate

Opportunity Recognition And The Opportunity Assessment Plan

MINOR SECTIONS:

Third Minor section: focus on the entrepreneur and the management team in terms of skills and experience.

FINAL SECTION: Timeline, successfully launch the venture and translate the idea in to a viable business entity.

Information Sources

Helps in starting the new business. 1. General Information: Help taken from the online websites e.g.

www.score.org (non profit organization).2. Industry And Market Information: There are the wide variety of database that provide

you the significant information about the industry and the market e.g. plunkett (trends) , frost and sullivan (specific info)

Information Sources

3. Competitive company and product information: supply significant information on product and services: Example: business source complete (industry

information).

4. Government sources And Search Engine: Census reports & export/import authority Search engine provide industry, market and competitive

information

5. Trade Association and Trade publishing: Trade association do market surveys. Trade publishing's provide insight on trends e.g. growth

rate

The Nature of International Entrepreneurship

The Importance of International Business to the Firm

International versus Domestic Entrepreneurship

International Entrepreneur: An entrepreneur doing business across his or her national boundary. It is more complex due to uncontrollable factors:

1. Economics: In domestic: Single economic system, same

currency In international: Dealing in differences in level of

economic development, Govt. regulation.2. Stages of economic development: Rational and regional variance. 3. Current Account: The trade status of import/export between

countries.

International versus Domestic Entrepreneurship

4. Type of economic system: Distribution rights Barter (directly exchange) or Third-party

arrangements (indirectly).5. Political-legal environment: Price fluctuation - VAT (value added tax) Political risk analysis (prior to entering into

business) critical areas (property right, contract law,

product safety & liability 6. Language: Native tongue

Technological Environment

Technology Varies Across Countries New Products are created based on conditions and infrastructure operating in the country

Culture

Culture refers to common ways of thinking and behaving

Culture Includes› Social Culture› Language› Religion› Manners and Customs

Culture in Entrepreneur’s Context

Crossing Cultures are the Problems for entrepreneurs

Entrepreneur must have command over country’s language

Both Verbal and Nonverbal languages are important

Culture Norms and Values

Social Culture Religion Political Philosophy Economics and Economic Philosophy Education Manners and Customs

Culture Norms &

Value System

Social CultureReligin

Language

Manners & Customs

Economics &

Economic Philosophy

Education

Social Culture

Refers to social institutions in a culture Social Stratification affect the behavior

of the people in one particular strata Reference Groups provide influencing

values and attitudes

Religion

Ideas for life reflected in values and attitudes of society

Impact on entrepreneurship varies Impact depends on dominant religious

tenets on attitudes and values

Particularly important for entrepreneurs in negotiations

Gifts can be important part of developing relationship in a culture

Manners and Custom

Available Distribution Systems

Factors to be Considered: Overall sales potential Amount and type of competition Product’s cost Geographical size and density of the country Investment policies of the country Exchange rate and any controls Level of political risk Overall marketing plan

Motivations To Go Global

Profits Competitive Pressures Unique Products or Services Excess Production Capacity Declining Home Country Sales Technological Benefits Tax Benefits

Strategic Effects of going Global

New set of wide ranging problems New set of domestic and international

regulations Physical and Psychological closeness

does matter

Foreign Market Selection

Market selection and market entry strategies are critical issues

Decision should base on past sales and competitive positioning

Appropriate market-selection model should be followed

Entrepreneurial Entry Strategies

Exporting Nonequity Arrangements Direct Foreign Investment

Exporting

Direct Exporting Indirect Exporting

Nonequity Arrangements

Licencing Turn-Key Projects Management Contracts

Direct Foreign Investment

Minority Interests Joint Ventures Majority Interest Mergers

Entrepreneurial Partnering

Amongst best methods for entering International Market

Foreign entrepreneurs know country and culture

Finding good partner can be beneficial for the entrepreneur

Entrepreneurial Partnering

How to find Good Partner?› Information needed on industry and

potential partners› Appropriate trade shows should be attended› Should Check References for the partner› Meet with the potential partner several

times before commitment

Barriers to International Trade

General Agreement on Tariffs and Trade Increasing Protectionist attitudes Trade Blocs and Free Trade Areas Entrepreneur’s Strategy and Trade

Barriers

Implications for the global entrepreneur