A. Country Overview: It is crucial to evaluate the influence of external factors on how businesses are conducted in a country. This includes the legal, economic, technological, social, and political factors. A stable, growing economy may offer opportunities for entrepreneurs, since there is likely to be a greater demand for goods or services. However, political instability can pose a risk to the venture as it might be more difficult to do business there. A company’s ability to operate business in another country may also be affected by legal, technological, and cultural factors.
B. Applying Porter’s Diamond: Porter’s Diamond is a model that is used to analyze the factors that contribute to the competitiveness of a country in a particular industry. These are the four components of the model:
- Factor Endowments refers to advanced production resources a country is able to access, including capital and skilled labor. These factors can be used to give a country a competitive edge by allowing it to use the country’s strengths.
- The spillover effect that allows firms to exploit market opportunities for their benefit is called Supporting and Related Industries. It is possible to identify key supporting industries by using SIC, NAICS, or SITC codes. This can assist in understanding the larger ecosystem where the target industry is located.
- Demand Conditions: This refers to the home demand for a firm’s product or service. Strong domestic demand could provide good opportunities for firms to serve.
- The conditions that determine how firms are managed, created and structured in a country include firm strategy, structure, and rivalry. Analyzing the positions of local competitors using SIC codes, NAICS and SITC codes can give insight into the market and potential opportunities for the target company.
C. Summary: In the summary section, it is important to discuss how the firm will take advantage of the opportunities made available by the country’s resources, as well as how the firm will deal with threats and risks to doing business in the country. It is important to conduct a market analysis and database search in order to locate at least 10 other competitors in the targeted country market. This information will be used to identify the direct competition using SIC or NAICS codes. These data will be useful in creating an entrepreneurial venture within the selected country. They will allow you to identify strengths and weaknesses in your competition as well as market sizes and trends.