The authors also state that speed with which the

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Unformatted text preview: ategory Internal category Figure 2.1: Factors influencing market entry mode selection Source: Adapted from Koch (2001), p.353 10 LITERATURE REVIEW 2.1.2 Theory by Brassington and Pettitt (2000) Brassington and Pettitt (2000) discuss two other internal factors. These are Payback and Speed. With payback the authors’ mean the time it takes for the company to create revenue from an investment in a new market that influences the company’s choice of foreign market entry mode. The authors also state that speed, with which the author means the time it takes to reach the target market, also greatly influences the choice of entry mode. 2.1.3 Theory by Hollensen (2001) Hollensen (2001) brings up three more factors of internal nature that might influence the choice of market entry mode. These are: Complexity and differentiation of the product The product complexity and differentiation of the product that the company is about to market to a new international market may very well influence the choice of entry mode according to Hollensen (2001), as it influences the cost of shipping, economies of scale, technology transfer, and already existing know-how, as an example the author brings up the risk of licensee abuse of technical know-how and that it might r...
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