1. The export entry method
is the way for manufacturing enterprises to export domestically produced products to the international market. It is the simplest and most common form. There are two main ways:
(1) Indirect export. It means that the enterprise does not directly participate in any activities in the international market, nor does it need to have specialized knowledge, expertise and specialized institutions for external operations. Instead, it sells or hands over products to domestic export trade agencies, who are responsible for selling to the international market. . This is the initial learning process for enterprises to enter the international market, and is mostly adopted by small and medium-sized enterprises that have not yet established their own sales networks in the international market. The advantage is that there is less investment and less risk. The disadvantage is that the company is only responsible for the production of products and has no direct contact with the international market. It is almost impossible to master and control international marketing activities, and at the same time, it earns very little profit. There are three ways to export indirectly: domestic exporters; domestic export agents; and entrusting a company with a sales agency abroad to sell on your behalf.
(2) Direct export. Refers to companies selling products directly to independent distributors or importers in foreign markets. In this way, a series of activities for the enterprise to develop the international market are completed by itself, thus enabling the enterprise to obtain more market information, partially or fully control the international marketing plan and modify it in response to changes in demand. It also helps preserve the value of trademarks, patents and other intangible assets. Its disadvantage lies in the potential threats of large investment, high risks and high expenses. There are four main ways: setting up domestic export departments, overseas sales branches, roving export sales representatives, foreign distributors or agents.
2. Contract entry method
The contract entry method is a long-term non-equity relationship between an international enterprise and a legal person in the target country, with the former transferring technology or skills to the latter. This method allows enterprises to enter the international market and choose the most flexible method that is most beneficial to them based on the specific conditions of the contract, reduce risks and maximize profits. There are many ways to enter into a contract, such as license trading, franchising, contractual arrangements, etc. Pay attention to understand the meaning and characteristics of these methods.
3. Investment entry method
Investment entry refers to the way in which enterprises invest in production abroad and sell products in the international market. This method can be used when the company already has rich international marketing experience, corporate strength and great international market potential.
Investment has many advantages: first, it can reduce costs and obtain higher economic benefits, because enterprises can obtain cheap labor and raw materials in foreign markets, which can save international transportation costs; secondly, it can bypass Market barriers erected by the host country. At the same time, local production and local sales will help product marketing adapt to local consumer demand and market environment. Its main disadvantage is that the risk is relatively high, and investment entry is divided into two types: sole proprietorship and joint venture.
(1) Sole proprietorship
That is, an enterprise independently invests in setting up an enterprise abroad, operates independently, and is responsible for its own profits and losses. The business has full ownership and control.
The main advantages of sole proprietorship are: ① It can strengthen the control of the sole proprietorship, fully integrate the foreign subsidiaries into the company's international marketing strategy, and make the subsidiaries obey the overall interests of the company and arrangements; ② It is beneficial to prevent the transfer of intellectual property rights outside the enterprise and avoid the rapid growth of competitors; ③ It is beneficial to the sole proprietorship of the enterprise to obtain all operating profits. However, this method is the riskiest of all ways to enter the international market. If the host country encounters confiscation, expropriation, inflation, price restrictions, etc., the enterprise will suffer great losses.
(2) Joint venture
It is a domestic enterprise and one or more foreign enterprises that jointly invest in and establish an enterprise at a certain ratio, jointly produce and operate and bear operational risks. , a way to obtain operating income. Its main advantages are: ① The political risk is small and you may enjoy more preferential treatment; ② Using the local relationships of foreign partners, it is easier to obtain local resources and open up the local market.
Its disadvantages are: ① It may cause the company to lose control of technology; ② It is not conducive to the company's implementation of a global unified coordination strategy, and it cannot enable the company to obtain the control of foreign subsidiaries needed to coordinate global competition; ③ Joint ventures It is difficult to coordinate between parties in management, and conflicts are prone to arise in profit distribution and use.