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Unformatted text preview: importance when choosing a market
entry mode, thus contradicting the theory argued by Bruhno and Schilt (2001). Furthermore,
our findings in case two revealed that Purac, even though they consider themselves as market
leaders, always assess the competition before entering a new international market, as a way to
measure if a successful market entry is possible and through which way the entry should be
performed. If the competition is regarded as high, the company does not use entry modes that
demand heavy resource commitment, thus verifying the theory stated by Bruhno and Schilt
(2001). 43 DATA ANALYSIS 5.3.4 Additional theory by Root (1994)
Root (1994) has also summarized the influence of external factors on the choice of entry
mode as shown in Table 2.1 in chapter 2. As stated in our conceptual framework we will use
this theory to show the connection between the external factors and the actual choice of
market entry mode. The companies in case one and case two, selects an international market
through stating a set of terms that has to be fulfilled in order for them to take interest in that
particular market. This has been taken under consideration when placing the companies in
Root’s (1994) table to be able to perform a relevant analysis of the theory.
TABLE 5.3 External factors influencing the Entry Mode Decision
External Factors (Foreign Country):
Low sales potential
High sales potential Case two
Purac Preferred entry mode X X Branch/ subsidiary exp...
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This document was uploaded on 03/22/2014.
- Summer '14
- The Land