How to Analyze International Opportunities

As the world is becoming more interconnected in this current age of information, businesses are required to be agile in analyzing international opportunities. However, the international market is marred with numerous challenges and troubles that may affect the operations of the business. If owners are not keen about how they operate in the international market, they may easily fail or lose out in competitive environments ( Wild, Wild, & Han, 2003) . As a result, having an effective entry mode is critical for a business to survive and maintain itself in the fast food market. This does not always mean that challenges in the market place are bad. Depending on the resilience of Betty’s Burger, its competitive strengths and challenges in the market place should act as a stepping stone for the success and growth of any business. Since the uncertainties of international business environments are numerous, the business has to establish a strong footing in the market. This means that they can either select good partners for cooperation or choose other means that they would be able to survive in the competitive business environment ( Wild, Wild, & Han, 2003) . However, in case of a partnership, the involved members need to be committed to the project and business ventures they have undertaken. On the other hand, determining the best country suitable for expansion requires an adequate market analysis. This is because deciding on several potential economies to invest in is crucial before businesses decide to choose one. 

Step 1: Basic Appeal 

The uncertainties of the international market and numerous and marred with problems ranging from different cultures, unfavorable policies, and harsh economic environments. The factors are significant influencers in business operations and negotiations since business need to first understand the cultures of the environment they want to operate in ( Wild, Wild, & Han, 2003) . At the same time, harsh economic conditions such as inflation, labor force and low-income among consumers would affect the growth of the business and its stability. In most instances, businesses would have countries that have cheaper labor force in order to manage their operational costs at a low level. In order to reduce the expense and financial burden of firms, Betty’s Burger would likely choose Asian countries that have a high labor supply. China and India rank among the top two countries in the world with a high labor force than other countries in the world (CIA). 

Step 2: The National Business Environment 

On the other hand, legal elements such as high taxation for foreign companies and other restrictive business policies for practicing in newer markets also make it difficult for a business to succeed and thrive as it was originally intended. The legal entry of businesses in foreign markets would, therefore, be hindered, expensive, and difficult ( Vogel, 2018) . Different cultures such as languages, beliefs, customs, and religion also significantly affect the way businesses operate in the international market. For instance, operating a business in China would require a full mastery of the language and their customs in order to carry out their marketing activities. In order to get to the locals, the business has to translate their language and make it easier for their locals to understand. The business also has to adhere to religious practices in order for them not to offend the locals who are their potential customers ( Wild, Wild, & Han, 2003) . For instance, restaurants opened in India would have to sell products that are non-beef since the majority of the Indians do not eat beef products due to their religion. Businesses should also understand the political stability of the nations they are engaging with in a bid to secure their growth and sustainability in the future. A firm would invest in a country that is politically stable such as the France, Japan, or Germany. The possibilities of businesses falling out or failing completely from the ventures are low. 

Figure 1: Country Comparison

Step 3: Market or Site Potential 

Apart from the U.S., the Chinese Economy has experienced an astonishing economic growth to be recognized as the world’s second largest. Since the 1978 economic reforms, the country has become a manufacturing hub with a nominal GDP of 9.2 trillion Japan closely follows in the third position and followed by Germany, the U.K, India, and France (Kiprop, 2019). The countries also rank among the top with a high GDP purchasing power parity. China leads with highest industrial output followed closely by Japan, Germany, India, and France (CIA). Therefore, fast movement of goods and services makes it suitable for Betty’s Burger to invest in since there is a high likelihood of people requiring fast services and products such as fast foods in order to work. The quality of infrastructure is also good thereby making it easier for goods and people to move freely across different regions without delays. 

Step 4: Market or Site 

In an already established market, competition is higher and gaining a good market share as a single entity would be challenging. Risks also increase since there is no back up particularly with respect to finances. With firms such as McDonalds in every country, competing with them would require a stronger competitive advantage that align with the region’s cultural practices. Some of the region’s spices such as Sushi in Japan could also be modified or added in the menu in order to attract more clients. However, the business has to strategically place itself new urban places that are fast moving and people may not have enough time to prepare home cooked meals. Location near industries would, therefore, be suitable and major centers. 

Entry Mode 

A business should also analyze the entry modes they want to penetrate the international market. They might either be fully owned subsidiaries, joint ventures, partnerships or take other legal business structures. Businesses may operate under the authority of a single parent company or combine efforts with another. Wholly owned subsidiaries enable managers to have complete control of their business operations ( Wild, Wild, & Han, 2003) . Complete control reduces the possibilities of Betty’s Burger tapping their full potential and realizing their growth without having to share their returns and profits with others. Unfortunately, they are expensive and require heavy investments for them to operate fully in achieving the established objectives. Therefore, obtaining funds for small and medium-sized companies is difficult and the risk of competition is higher. 

In most instances, business joint ventures in international markets are suitable for small to medium-sized firms that are exploring their business for the first time in foreign markets. Joint ventures make operations easier and reduce the risks of having to share losses alone. A company that is created and jointly owned pols resources from different areas and makes it easier for operations to be undertaken. Joint ventures also save the trouble of having to look for resources since there is a greater possibility of there being diverse talents and sharing of information pertaining to the undertaken venture ( Wild, Wild, & Han, 2003) . However, due to different organizational values, cultures, and interests, conflicts may arise and disrupt the flow of business as it was earlier intended to be. On the other hand, the death or bankruptcy of one party will cause the dissolution of the entire business venture. Therefore, the risks of business failure are high coupled with the uncertainties of the international market. 

In this regard, strategic alliances provide the best solutions for businesses entering international markets. Strategic alliances are formed in a manner that would facilitate the successful implementation of the project in international markets. Fortunately, strategic alliances are established businesses and their suppliers or distributors. Therefore, there is no risk of having conflicts or worries about the other taking over the entire business in the international market. Two entities only cooperate to achieve common objectives while still operating as different business entities ( Wild, Wild, & Han, 2003) . In the process, businesses share costs thereby making the process less costly and easier to start and maintain while marinating growth in the international space. However, an alliance requires that both parties become transparent and share details that may be risky and foster competition in the future. Participating in strategic ventures may provide the other party with an advantageous position. 

Conclusion 

Betty Burger should consider investing in China, India, Japan, Germany, and France where there is political stability, high economic performance, good and affordable labor force, excellent infrastructure, and good legal business environment. Since the business aims at growing the business further by tapping into new markets, they should realize the importance of having a critical analysis before venturing. Analyzing international space and contributing factors is important. Gaining full access to the market is a competitive advantage to the firm but requires agility and accuracy. A business should be careful in deciding the type of legal structure before venturing into any business in the new market. The best venture among the three types is a strategic alliance. This is because the mutual benefits are higher and businesses do not lose their identity and processes. At the same time, they have to be careful about the political, cultural, and economic factors in foreign space. 

References 

CIA. The world Factbook: Country comparison. Retrieved from https://www.cia.gov/library/publications/resources/the-world-factbook/fields/385rank.html 

Kiprop, V. (2019). Top 10 countries with the highest Industrial outputs. World Atlas. Retrieved from https://www.worldatlas.com/articles/10-countries-with-the-highest-industrial-outputs-in-the-world.html 

Vogel, S. K. (2018).  Freer markets, more rules: Regulatory reform in advanced industrial countries . Cornell University Press. 

Wild, J. J., Wild, K. L., & Han, J. C. (2003).  International business  (p. 342). Upper Saddle River, NJ: Prentice Hall.