Internationalisation ppt [repaired 2]


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  • Involvement = planning and implementation of products and services that can easily be adapted to specific local languages and cultures, a process called localization. The internationalization process is sometimes called translation or localization enablement
  • .Nowadays, internationalization affects all firms: large and small respectively. Increasingly, smes are challenged and confronted with international competition and are forced to play a role in international markets. This internationalization can take place in many forms such as imports, export, fdi and technological cooperation. Import and export are more common modes of internationalization and has a positive impact on firm’s survival. EXPORT: covers activities that moves outward; products and services that moves towards a foreign country. Export modes may include: direct export, indirect export and FDIIMPORT: Today many firms first venture into the international marketplace begin with importing. When products and services are bought from a foreign country. Import modes involves trade in goods and tangible goods.
  • Faster growth: Firms that have operate internationally tend to develop at a much quicker pace than those operating locallyAccess to cheaper inputs: Operating internationally may enable the firm to source raw materials or labor at lower prices Increased quality and efficiency: Exposure to foreign competition will encourage increased efficiency. Doing business in the international market allows firms to improve the quality of their product in order to gain a competitive advantage.
  • Internationalisation ppt [repaired 2]

    1. 1. SME’s DEVELOPING EXPORT MARKETS & INTERNATIONALIZATION<br />GROUP MEMBERS:<br />Sizwe S.<br />Mike D.<br />Gokul K.<br />Jimmy <br />Subhi p.<br />
    3. 3. EXPORT MARKETS<br />
    4. 4. MEANING OF EXPORT MARKET<br />Send goods or services to another country for sale.<br />Spread or introduce ideas and beliefs to another country.<br />
    5. 5. CONTD…<br />“Exporting is a key aspect of international trade and involves the sale, purchase or exchange of goods and services across national border” (Export Business Guide, YEAR)<br />Global value: $12 trillion annually<br />World trade is dominated by merchandise in the form of manufactured goods, minerals and agricultural commodities<br />Export of services has been increasing (20%)<br />
    6. 6. EXPORT MODES<br />Direct exporting<br />Indirect exporting<br />Countertrade<br />
    7. 7. A SUCCESSFUL EXPORTING<br /><ul><li>Make a commitment to exporting plan.
    8. 8. Conduct research to find the right market.
    9. 9. Devise marketing strategies for target market.
    10. 10. Enter the market.
    11. 11. Get your product or service to market.
    12. 12. Explore financing options.
    13. 13. Understanding of legal and regulatory issues.
    14. 14. Put it into practice.</li></li></ul><li>BENEFITS<br />Promote growth.<br />Exploit technology and expertise.<br />Enhance competitiveness.<br />Improve return on investment.<br />
    15. 15. BARRIERS TO EXPORT<br />Lack of knowledge of best potential markets<br />1<br />2<br />Lack of finances for market research<br />3<br />Lack of staff for export planning<br />4<br />Effect of strong foreign competition among others<br />
    17. 17. MEANING OF INTERNATIONALIZATION<br />With reference to the process models of internationalization, Welch and Luostearinen (1988) define internationalization as <br />“as the process of increasing involvement in international operations”<br />
    19. 19. ADVANTAGES OF INTERNATIONALIZATION<br />Faster Growth<br />Access to cheaper inputs<br />Effect on performance of enterprise.<br />
    20. 20. PERCEIVED BARRIERS TO INTERNATIONALIZATION<br />INTERNAL<br /><ul><li>Price of firm’s products
    21. 21. High cost of internationalized
    22. 22. Quality of firms products
    23. 23. Qualified personnel
    24. 24. Specifications of firm’s products
    25. 25. Language
    26. 26. Other barriers</li></ul>EXTERNAL<br /><ul><li>Lack of capital
    27. 27. Lack of public support
    28. 28. Lack of information
    29. 29. Laws and regulation in foreign countries
    30. 30. Cultural differences
    31. 31. Tariffs and trade barriers
    32. 32. (home and foreign countries)</li></li></ul><li>SMS’S DEVELOPING EXPORT MARKETS & INTERNATIONALIZATION<br />
    33. 33. INTERNATIONALIZATION WEB<br />Educational background, networks, cultural values, foreign competitors, Language, Visits<br />Attitude towards internationalisation. <br />Acceptable/Willing<br />Feasible<br />SME OWNERMANAGER<br />The Overseas/Global Market. <br />Appropriate/Ready<br />Finance, Skills, Core Competences, Products. <br />Resource Base<br />
    34. 34. ANSOFF GROWTH MATRIX<br />
    35. 35. KEY MOTIVATORS TO INTERNATIONALIZATION<br /><ul><li>Proactive stimuli:
    36. 36. attractive profit/growth opportunities
    37. 37. ability to easily modify products for export markets
    38. 38. public policy programmes for export promotion
    39. 39. foreign country regulations
    40. 40. possession of unique products
    41. 41. economies from additional orders
    42. 42. Managerial elements:
    43. 43. presence of export minded manager
    44. 44. opportunity to better utilise management talent and skills
    45. 45. management belief in value of exporting
    46. 46. Reactive stimuli:
    47. 47. adverse domestic market conditions
    48. 48. opportunity to reduce stocks
    49. 49. availability of production capacity
    50. 50. favourable currency fluctuations (local made cheaper)
    51. 51. opportunity to increase the number of country markets and reduce market related risk
    52. 52. unsolicited orders from overseas customers</li></ul>.<br />
    53. 53. MCKINSEY 7S FRAMEWORK<br />Structure<br />Strategy<br />Systems<br />Hard Elements<br />Shared <br />Values<br />Skills<br />Style<br />SoftElements<br />Staff<br />
    54. 54. CASE STUDIES OF SMEs <br />
    55. 55.<br /><ul><li>Based in Kidderminster
    56. 56. Corporate leather gifts
    57. 57. Got unhappy with the Indian Suppliers
    58. 58. Established own manufacturing
    59. 59. 100% owned subsidiary in 6 months
    60. 60. 100 employees in first year
    61. 61. 33% growth in UK sales.
    62. 62. Entered markets in Japan, Dubai, Tanzania, Kenya, local Indian House Business markets. </li></li></ul><li>COBRAUK LTD<br /><ul><li>Factory in Waymills Industrial Estate, Whitchurch.
    63. 63. Products for the automotive interior sector
    64. 64. Global economic downturn, which reduced orders by 90%
    65. 65. New products – Help from UK trade and development(turn over increasing by 70%)
    66. 66. Won a major order to provide safety barrier nets, for a Swedish car manufacturer. (8m EUROS over 7 years).
    67. 67. Moving to aviation industry, with lightweight airline seat ( Russian Aircrafts)
    68. 68. 80% of annual turnover is from exports.( £2.35 m)
    69. 69. Expected rise in turnover £4m</li></li></ul><li><br /><ul><li>Based in Vale Business Park, Evesham
    70. 70. Installs and maintains electronic-based systems in buildings such as </li></ul> mental health hospitals, custodial suites and airports.<br /><ul><li> Provided a trial system at a mental health ward in Bentley Hospital, Perth, Western Australia
    71. 71. Invited for a tender for the whole hospital.
    72. 72. Competitive contract which won the order and different hospital contracts in Western Australia.
    73. 73. Demonstrated long-term commitment to its activities in Australia.
    74. 74. £ 400,000 worth contracts, which is estimated to increase by £ 3m
    75. 75. Expanding its services to other states in Australia.
    76. 76. Passport to Export Scheme was one of the helping hands behind the business.</li></li></ul><li>INDUSTRIAL PENSTOCK<br />Specialise in the design, manufacture and installation of penstocks and valves for fluid control.<br />Based in Netherton, West Midlands with 9 employees.<br />2002 Exported in excess £1.8m and awarded a £2m contract<br />
    77. 77. ENTRY TO EXPORTS<br />One of the first West Midlands Business to join the UK Trade & Investments Flagship Passport to export scheme.<br />Access International Markets.<br />Developing International trade potential.<br />Access to Information, advise, Mentoring and Support from UK staff at home and overseas.<br />
    78. 78. RACHEL DORMOR CERAMICS<br />Based in Staffordshire University, Leek road business Village<br />Sells to over 20 high end boutiques and Galleries in the UK<br />Invited to exhibit at the New York gift fair by the craft council<br />(OMIS) Overseas Market Introduction Service report show 12 Potential agents<br />
    79. 79. DEVELOPING IN THE MARKET<br />Trade show access programmes<br />Buyers, agents, distributors, and customers<br />Raising a companies profile and testing new markets<br />Financial support and potential partnership opportunities<br />
    80. 80. ACTIVITY 1<br />
    81. 81. INSTRUCTIONS<br />Divide: Students into 5 <br />From your list, find the country that has the good that you need.(1-3 minutes)<br />Form a circle and use the string to connect the first pair of trading.<br />
    82. 82. CONCLUSION<br />Identify you business needs and develop your companies export strategy<br />Develop your export skills and cultural awareness<br />Research on Market size and segmentation<br />Regulation and legislation, customer need usage and attitudes, distribution channels, trends, competitor activity strategy & performance<br />
    83. 83. REFERENCES<br />Business Victoria (2008) Benefits of Exporting. Available at [Last Accessed on 28th February, 2011].<br />Oxford Dictionary (2011) Meaning of Export. Available at [Last Accessed on 22nd February, 2011].<br />Small Business Canada (2011) 10 Steps to Successful Exporting: Export Shipping, Financing & Regulations. Available at [Last Accessed on 23rd February, 2011].<br />Export Reference Guide (2009) Opening Doors to Export connects you to world-class export assistance. State of Victoria, US.<br />West Midlands Chamber of Commerce (2010) INTERNATIONALISATION SUPPORT FOR WEST MIDLANDS BUSINESS. Birmingham, Midlands.<br />Czinkota, M.R. and I.A. Ronkainen. (1988) International Marketing. Chicago: The Dryden Press.<br />
    84. 84. Welch, L.S and R.K. Luostarinen (1988) Internationalization: Evolution of a Concept. Journal of General Management. 14 (2) 36-64.<br />Banerjee, D and Nikolaos, B (2010) Internationalization Process in developed and Developing Countries. Available at [Last Accessed on 3rd March, 2011].<br />Ellis R. and Williams C. (1995) International Business. Pitman Publishing, London.<br />Strategies for internationalisation within SMEs : The key role of the strategic leader and the internationalisation Web. Available at . [Last Accessed on 5th March, 2011].<br />Buckley, P.J. (1993) Barriers to Internationalization. Business and Economics. 79-106.<br />Global Independence [Online]. Available at [Last Accessed on 12th March].<br />Czinkot (2004) The Drive to Internationalize. The Export Marketing Imperative. Thomson Learning: Texere. <br />
    85. 85. Ansoff, I. H. (1957) Strategies for diversification. Harvard Business Review, 35 (2), 113-124.<br />