Firms and international trade: Optimal mode of entering foreign markets

Abstract

Multinational companies get involved with global market and expand their territories by choosing the entry mode to get into a foreign market which mayprovide its products and services leading to development of the firm. The types of entry modes are divided between full control modes where companies arecontrolled exclusively by them and shared control modes which are based on collaboration. The final option of the entry mode has a number of implications onbusiness strategy of the firm itself, its competitors and the market it enters in general. All these implications are about to be presented in this thesis.Furthermore, international strategy is associated with the entry mode decision to a foreign market. The effects of the entry mode on firm’s strategy originate in a framework of variables which are analyzed below as they affect not only every decision of the firm on expanding in a certain market but also the type of entry of the firm. On this assignment most of the variables that compose a business research area of a firm are mentioned in order to extend to a foreign market. On theother hand, the market itself is characterized from certain implications that affect the entry mode decision directly. As a matter of fact, this research is not clearly resource-based but its purpose is to present the need to achieve the combination between the ideal markets for each business separately with the most successfulmodel, always matched with the choice of its favor strategy.