INTERNATIONAL_BUSINESS - Essay Example

Companies investing in foreign markets are ultimately inhibited by the underlying antipathy of the local firms and dearth of local traditions and norms awareness thus suffer constraints owing to their alien status. There are already many established foreign firms that have apparently penetrated the market hence will offer ready competition but also provide us with an insight of the market strength. Peng et al (2009) through their integrated global trade model propose two approaches in discerning global industry frameworks.

These are the institution-based outlook in which overseas enterprise corporations concentrate on studying the domestic trade situation; and the resource-based outlook whereby the corporation uses its customary competitive advantages like advanced equipment or merchandise to add a toehold in the domestic markets. China as one of the top growth emergent markets offer a vastly developed latent platform for establishing an global market to cater for the many foreign travellers including investors and tourists in addition to the local traders.

This will provide the firm a viable entry point into the nascent ASEAN regional market for ABC PLC. According to Porter (2009), a firm’s external competitive advantage is mostly dependent on location of the business. He observes that even with the advent of globalisation the cost of doing business in China has appreciated due to high energy and other logistical expenses. Beizhong (2009) cites three criterion used by firms intending to venture into foreign markets. These include “the competitive ability in the international market, the competitive advantages and competitive risks” (Pg.2). International development will enhance our hotel chain growth by cushioning the current economic recession in our other ventures with the sustained growth always prevalent in China.

The marketing model to be followed will be as outlined in Bothma (2008)