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Case Study Notes 2: Framework# Enter a market

Entering a new market or not is perhaps one of the most challenging question businesses often have. Such case studies needs to be analyzed in a multi view environment.  For a systematic analysis environmental heads can be categorized as follows –

Market Analysis

  • Size of the market
  • Major players in the market
  • Market share of the major players
  • Growth rate
  • Entry barrier to the market (Capital requirements, access to distribution channel, proprietary product technology, government policy etc )
  • Exit barrier to the market

Customer Analysis

  • Who are the customers & how are they segmented?

Product Analysis

  • USP of our product? How is it different from competitor’s?
  • Product substitutes
  • Product pricing
  • Product Patents

Legal Analysis

  • Regulatory terms & condition prevailing in the industry

Competitor Analysis

  • Competitor’s response in case we enter the market

Financial Analysis

  • Overall project budget vs business function wise budgets (e.g. marketing budget)

Technical Analysis

  • What role does technology play and how quickly does it change?

At the end of above analysis, if the answer is “Yes“, then one should evaluate what would be best way to enter a new market –

  • Start from scratch
  • Acquire an existing player within the desired industry
  • Form a joint venture/strategic alliance with another existing player

Perform cost benefit analysis for each of these options to come to a conclusion.

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