Foreign Major Markets
Week Five AssignmentJacob T. BierbaumAmerican Military UniversityBUSN601: Global Management PerspectiveJune 7, 2015AbstractThis paper will focus on the three major markets that are present in every foreign market that businesses deploy into, which are the consumer, industrial, and government markets. Furthermore, I will explain the significance of each of these markets, as well as why they are important to a business looking to enter into any given foreign market. Finally, I will discuss the comparative impact that each of these markets can have on a business’ chances of success in a new foreign market.        The understanding of foreign markets prior to entering into them is a factor that can make the difference between success and failure for a business as a whole. Collecting valuable information about the various aspects of the foreign market, including how the specific culture’s values impact them in every sub-section of the market, is something that major industries look very deeply into prior to committing to a certain new foreign market (Kertesz et al, 2011). This includes not only looking into the three main markets present in every foreign market, which are consumer, industrial, and government, but also all of the factors and aspects that feed into making those major three markets into the important players that they are (Gaspar et al, 2014). The knowledge of these three key markets can translate directly into success for a company in any given foreign market.
The first market section present in every foreign market is the consumer market. In developed countries, this often comprises over 50% of the entire market, making it a key driver to understand when a business may be moving into new territory (Gaspar et al, 2014). This market is, as its name implies, generally comprised of the market’s consumers that purchase goods for themselves, and not for resale (Kertesz et al, 2011). This includes a wide variety of products that may be popular at any given time within the market, including clothing, food, transportation, entertainment, and banking services (Gaspar et al, 2014). Given that the consumer market can vary so widely from one foreign market to another depending on the cultural tasted of each market, this market is extremely important to understand prior to moving into any given foreign market.        The second market section present in every foreign market is the industrial market. This market generally purchases industrial-grade machinery, heavy equipment and supplies, raw materials to be used for production, and things related to marketing a major business (Gaspar et al, 2014). Generally, this market will be filled with industrial-level consumers that produce products from one or more raw materials. Given this fact, this market will often consume partially finished products, as well, that they intend to complete and sell into another market. Although this market may seem less important statistically than a consumer market, this market is important in that it often deals with large and more consistent purchases (Turnbull & Valla, 2013). This is different from a consumer market, which may involve one-by-one sales that require much more overhead cost.