Market Entry Strategy Essay Example | Topics and Well Written Essays - 2000 words

Market Entry Strategy - Essay Example From the Porter’s five forces, the study has identified that South Africa’s accounting industry is highly competitive and the bargaining powers of suppliers is low and that of buyers is high. The market has high skilled experts in the industry, which is a critical factor attracting accounting and consulting firms in the market. From the analysis done on the market, this study has recommended Rodl & Partner to invest in the market using licensing and has guaranteed that the market is a viable one for foreign investors who are willing to expand their international market presence. However, it is recommended that the company explores the market to ensure compliance with national and international standards for the company that will be chosen for licensing agreement. This will help in ensuring that the company’s reputation is maintained. Introduction Different market entry strategies can be used to enter a new market, these strategies include mergers, acquisitions, j oint ventures, exporting, Greenfield project, strategic alliances, franchising/licensing and whole subsidiary ownership (Janssen 2004, p. 556). Some of the factors that influence the choice of a market entry strategy include price localization, trade barriers, competition, export subsidies and localized knowledge (Grunig & Morschett 2012, p. 151). Globalization and foreign direct investments have been vital in global expansion of companies (Hill 2005, p. 67). This study suggests licensing as a market entry strategy that could be adopted by Rodl & Partner in its entry to South Africa (Rodl & Partner, 2012). South Africa is one of the well known markets that have well developed accounting, auditing and consulting industry and this makes the selection a suitable one for Rodl & Partner. South Africa enjoys a stable and developing economy and this has been a key attraction for foreign investors. Rodl & Partner Ltd Background of the company Rodl & Partner is an international consulting an d accounting firm with German origin. The company has established and built unique capabilities in the global consulting industry particularly in accounting, tax planning and attestation services for companies across various continents. The company has about 3200 partners located in about 130 countries across globe. The company provides customers with distinctive and high quality service in the various categories of accounting services (Rodl & Partner, 2012). Rodl & Partner has its strengths in tax, assurance and specialist advice. Rodl & Partner will be entering South African accounting and consulting industry in July 2012 and this will require the company to be well prepared in expanding its business in this new market so as to be able to promote its brand awareness in the global market. PESTEL analysis Economic environment: South Africa has risen from international isolation and economic stagnation caused by apartheid era. The new phase of economic reconstruction has received enc ouragement and acclaim internationally (Thompson 2001, p. 23). The country was rated 25th in terms of advanced industrial sectors in the world in 1990s and has since then marked increasing growth. Political and legal environment: South Africa has had stability in its political and legal systems. Policies made by government are focused on strengthening economic power of the country and this makes