Analyse various methods that a business can use when determining whether there is a market in a foreign country.
The first step for any business looking into an international trade venture, is obtaining a good understanding of the market assessing viability and potential success. An exporter would analyze the potential competitiveness of the exports, select a target market, conduct market research- market analysis, positioning and mapping, as well as finding the best method to reach the target market overseas.
The challenge for any business is to gain a sufficiently detailed understanding of the fundamentals of a market. Without this insight, it is unlikely that marketing strategies will prove effective. This would be gained through market analysis by understanding issues such as the size of the market for example, measured by sales value, volume sold etc; how fast the market growing and looking at the future growth potential? How the market is segmented to meet different customer needs, customer preferences in terms of when and where they buy what prices they pay and which methods of promotion are effective; the potential for developing a competitive position in a market – either through a USP or through effective price competition. The process of analysing the market should not be considered as a one-off. An effective marketing team is constantly searching and updating their market knowledge. These things would be done through surveys and setting up focus groups, looking for secondary data. Looking to a foreign company the key element would be identifying potential employers – many UK businesses for example would look firstly in exploit markets of English speaking countries. The information on income growth and distribution (from secondary research) is essential for a business selling consumer goods. .
In some markets it may be evident that there are some already active exporters; any company that is in the same industry or offers like or competing products is a competitor.