Week 5: Decision Points in SME Internationalisation Flashcards
What are the four components of value proposition?
- What is your offering?
- What makes your offering stand out?
- How is your offering different and better from competitors?
- Why should customers come to you?
What research/data is required for a firm to decide whether to internationalise?
Internal primary and secondary research
External primary research, secondary research and utility
What are examples of external secondary research?
Looking on websites like MPI, NZTE, marketing sites, MFAT market profiles, MB research on specific markets or products.
What are the four channel options of going international?
Direct channel, indirect channel, online channel, and daigou (informal e-commerce channel).
What is small domestic competition?
Domestic SMEs operating in the country we seek to enter. They may receive government support e.g. access to funding, incentives, tax breaks and subsidies.
What is small international competition?
In most cases, international competitors are large relative to NZ SMEs
What is large domestic competition?
Large domestic firms operating in our target country. They have inherent advantages in size and market knowledge
What is large international competition?
International firms come with significant reputational capital.
One decision to make is knowing what your capacity and capability is. What is capacity and what is capability?
Capacity is the resource base required to support internationalisation.
Capability is the product and process related competencies.
What are the main three compliance requirements for SMEs to go international?
Registration, permits/licenses and certification
What are the two costings needed to know before going international?
Marginal costing and absorption costing
What is marginal costing?
Marginal costing includes incremental costs. Incremental costs are separating the export venture costs from the rest of the SME costs.
What is absorption costing?
Absorption costing includes total costs. These can be calculated once we know our own capacity and capability of what it costs to get this product to market.
What are the pricing options for an internationalising SME?
Cost-based pricing, every day low pricing, value-based pricing, competitive/going rate pricing, new product pricing, and premium pricing.
How do SMEs raise money/get funding?
Internal, open market, policymaker assisted
