- •Acknowledgement
- •Abstract
- •International Market Entry Strategies
- •Regulatory Environment
- •Challenges of International Expansion
- •Purpose of the Study
- •Research Objectives
- •Research Questions
- •Justification for the Study
- •Scope of the Study
- •Delimitations
- •Chapter 2: Literature Review
- •Introduction
- •International Expansion
- •Internationalization/Transaction-Cost Theory
- •Eclectic Theory
- •Resource-Based Theory
- •Uppsala Model
- •International Market Entry Strategies
- •Exporting
- •Licensing
- •Franchising
- •Joint-Ventures/Strategic Alliances
- •Acquisitions
- •Wholly-Owned Subsidiaries/Greenfield Operations
- •Figure 2‑1: Selecting Market Entry Mode: Risk Profiling
- •Regulatory Environment
- •Challenges of International Expansion
- •Research Gaps
- •Chapter 3: Research Methodology
- •Introduction
- •Research Methodology
- •Research Methods
- •Research Approach
- •Research Design
- •Choice of Companies
- •International Expansion
- •Host Country Overview: Kenya
- •Company Overview: eabl
- •Table 4‑1: Kenyan Beer Market
- •Source: Irungu (2012)
- •Market Entry Strategy
- •Regulatory Environment
- •Market Performance
- •Market Challenges
- •Case Study: sab Miller (Colombia – Grupo Bavaria)
- •Company Background: sab Miller
- •International Expansion
- •Host Country Overview: Colombia
- •Company Overview: Grupo Bavaria
- •Market Entry Strategy
- •Regulatory Environment
- •Market Performance
- •Market Challenges
- •Chapter 5: Discussion of Findings
- •Introduction
- •Case Analysis: Diageo (Kenya)
- •Case Analysis: sab Miller (Colombia)
- •Cross-Case Analysis
- •Chapter 6: Summary, Conclusions, and Recommendations
- •Introduction
- •Summary
- •Conclusions
- •Recommendations
- •Future Research
- •Chapter 7: References
- •Chapter 8: Appendices Table 8‑2: Common Size Analysis: Diageo and sab Miller
- •Source: Diageo (2013) and sab Miller (2013a)
- •Table 8‑3: Comparison of Market Entry Modes and Performance
- •Source: Diageo (2013a), eabl (2013), and sab Miller (2013)
Challenges of International Expansion
Expanding into international markets are affected by numerous that arise from lack of adequate domestic experience. There are myriad challenges that are faced by the new global organization. An organization has to adopt new rules as part of global engagement and understanding new economic architectures (Lee & Carter, 2012).
Internationalizing firms have to match the dynamic requirements of global customers/consumers. Developing long-term and profitable relationships with partners to sustain strategic initiatives is an on-going business challenge. Cultural diversity based on power distance and uncertainty dimensions differs from country-to-country.
According to Hofstede (1996), the main cultural dimensions include; uncertainty avoidance, collectivism/individualism, femininity/masculinity, and power distance. Usunier (1996) noted that majority of emerging/frontier nations (in Asia, Africa, and Middle-East) exhibited strong power distance and masculinity in their cultural configurations.
The psychic cultural distance affects the expanding firms when approaching the foreign markets. Regulatory challenges such as import taxation, FDI limitations (minimum and maximum), and industries also affect growth. The ability to adapt to domestic business practices as far as labor relations, market access, and legal protection is a huge challenge. Protection of intellectual property affects the ability to innovate and achieve long-term competiveness.
Purpose of the Study
The aim of the study was to investigate modalities that are involved in international market expansion. It analyzed using two case studies the processes that real-life firms utilized in expanding internationally. The literature scope covered; motivations for expansion, market entry modes, and regulatory challenges involved in internationalization.
It undertook a critical evaluation of business practices that are involved in internationalizing. The study offers insights that would be useful for organizations intending to expand their operations to international markets. The illustration of efficacy of various entry modes is useful especially for SMEs intending to internationalize.
Research Objectives
To evaluate the attractiveness of international markets in the globalizing world.
To ascertain the most appropriate international market entry modes and strategies.
To determine the challenges faced by an organization during international market expansion.
Research Questions
What is the attractiveness in expanding internationally in today’s globalizing world?
What are the most appropriate international market entry modes and strategies?
What are the challenges faced by an organization during international market expansion?
Justification for the Study
The research was intended to contribute to expanding body of research on internationalization of business firms. Despite being a widely researched field, the dynamics involved keep evolving. It sought to illustrate paths that were adopted by tow western multinationals in internationalizing operations and their successful.
These MNCs (Multinational Corporations) originated from different countries and leveraged on different approaches to expand. Existing regulatory and market challenges were correlated to the success of the selected market entry strategy. In effect, the study provided practical insights to adapt expansion strategy by examining real experiences.