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Internationalization strategies: identify target markets

Internationalization strategies: identify target markets

To develop internationalization strategies effective, it is essential to start by identifying the foreign markets with the greatest opportunities for companies intending to expand internationally. This process requires a careful evaluation of the company's strengths and areas for improvement, as well as the analysis of any non-conformities and competitive advantages in relation to the global context.

A crucial step is to conduct an in-depth analysis that examines the company's positioning in the market, the distinctive characteristics of its products and potential opportunities for collaboration with foreign partners.

To respond to these needs, Octagona has developed the service Internationalization Radar. This tool allows companies to better understand their potential and peculiarities, facilitating access to new markets and optimizing their internationalization strategies. In fact, the Radar offers a clear and structured guide to successfully expand activities globally, through a targeted selection of target markets.

Let's take a closer look at this service, analyzing in detail all the aspects it considers.

internationalization strategies

 

Internationalization radar: a targeted service for companies that intend to expand their business beyond national borders

In a context of growth in Italian exports, expected to increase of 2.1% for 2024, it is essential to identify the foreign markets with the greatest potential. The Internationalization Radar is a tool designed to analyze a range of economic and logistical factors, providing a clear hierarchy of the most promising markets for expansion.

This tool plays the role of guide for Italian companies wishing to expand internationally, helping them determine where to invest time and resources to maximize results.

Let's examine in detail the factors taken into consideration by Radar. One of the main challenges for exporters is certainly that of selecting the most promising international markets. But how to identify these markets and make the most of their potential?

The objective is not simple, as there are various and crucial factors to consider. It is therefore essential to develop a structured action plan in different phases to identify the key elements that determine success in a new market.

Internationalization strategies, the key indicators to understand the potential of foreign markets 

For each sector they belong to, companies that intend to expand abroad must first understand their potential and areas for improvement. This allows us to identify what differentiates them from competitors, both nationally and internationally.

To identify the target market, it is then necessary to consider various factors such as the following.

Geographical and cultural proximity

A first fundamental criterion is geographical and cultural proximity. Considering logistical distance is essential to evaluate transportation times and associated costs. For example, export to neighboring countries such as France, Germany or Spain generally involves road transport costs, which are lower than those needed to ship goods to China, where a greater investment is required for sea transport.

Furthermore, understanding cultural differences is crucial, especially if you intend to export agri-food, where it is essential to take local food preferences into account. For example in this case, it is essential to know if there are specific food restrictions in a certain country or if there are ingredients that are not commonly consumed.

It is also important to remember that the communication with target countries it must be adapted to the cultural peculiarities and characteristics of the local population, to ensure effective and respectful interaction.

Economic growth

A key indicator to consider is the economic growth of the destination country. A significant increase in Gross Domestic Product (GDP) can indicate a promising export market. For example, ASEAN countries such as Vietnam, South Korea, Indonesia, India, have shown considerable economic dynamism in recent years, making them potential markets of great interest for exports.

Costs related to certifications and duties 

It is essential to consider the presence of customs duties and the regulations of the destination country. Evaluating product requirements, necessary certifications and associated costs is essential to making informed decisions regarding the end market and setting the right internationalization strategies. For example, to export to India, you may need to obtain the BIS certification, while for themechanical export Specific product certifications are required.

internationalization radar

 

Operational planning for the choice of foreign markets

After considering these initial factors, it is important to focus on a series of operational steps.

Enhance previous experiences for export

Even if you are exporting for the first time or have only a few experiences with foreign clients, these experiences can provide valuable insights. Using these experiences as a starting point can facilitate entry into new markets.

Furthermore, the background of employees with international experience represents a highly valuable resource.

Competitive analysis

Studying the markets in which competitors operate can provide valuable indications for winners internationalization strategies, identifying the best markets to focus on.

Most companies plan their global expansion choices through in-depth studies that are included in a business plan detailed.

Perform thecompetitor analysis it can reduce risks and provide useful information to optimize time and resources.

Identify countries that are part of free trade areas

Focus on groups of countries that are part of free trade areas or customs unions can bring significant benefits. For example, establishing a base of operations in countries such as Canada, Mexico, Japan, United States, or Vietnam for ASEAN, it can facilitate access to a large number of growing markets.

The Octagona Radar is designed to identify optimal internationalization strategies for companies in any sector. Exploring the case studies of Octagona, you can appreciate the tangible benefits and valuable assistance offered to companies interested in expanding their export operations. 

Don't hesitate to contact us for more information.

 

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