The paper "Atlas Copco Market Entry " is an outstanding example of a marketing assignment. Market entry holds an important aspect for every business looking towards entering into a new marker as it helps to shape the manner in which the performance of the company will be evaluated. The success and failure of a company greatly depend on the mode and manner in which the companies are able to use it in the most effective way. The market entry mode chosen and managed by Atlas Copco can be termed as excellent because the company looked towards differentiating their products and having different franchise agreements so that the franchise didn’ t compete with one another.
This entry mode will ensure that franchisees will get a good return on their investments and will be able to identify their target customers better. Atlas Copco has decided their market entry strategy where the risk and control is in the midway as shown from the highlighted red color in the chart below (Doole & Lowe, 2001) Atlas Copco by choosing a strategy of entry where there was an equal concentration of both risk and control had ensured that their market entry strategy helps them to have control over the business at the same ensure that they are able to provide the different franchise with an advantage to control their market. Atlas Copco has ensured that they differentiate between the franchise by having something different offered to them but hasn’ t been able to receive the same response as their market share has not grown substantially.
Atlas Copco has just been able to increase in market share to 10% from 1% over a period of 10 years highlighting the fact that the company hasn’ t been able to utilize the entry to garner maximum market share. Atlas Copco while entering the market has used the franchise model to ensure that the cost remains low and has looked towards vertical integration which should ensure that Atlas Copco is able to sell its products more effectively (Cateora & Graham, 2002).
Atlas Copco has also ensured proper delivery of goods to the franchise but the model chosen by Atlas Copco hasn’ t fetched the expected results.
This has resulted in the sales to be slow and hasn’ t provided the same benefit that the model should have. Atlas Copco was able to identify the fact that the US market is a very promising market and provides an opportunity to tap on. This made Atlas Copco look towards the franchise model and look towards vertical integration. This is supported by a study that states that the entry modes chosen in an international market should be based on the requirements and core competency of the business (Malhotra, Agarwal & Ulgado, 2003). This was a strategy that was adopted by Atlas Copco and resulted in an appropriate strategy to enter the market but wasn’ t able to garner the same advantage that the market should have provided to them. 2.
Companies also need to look towards having a model that will ensure that the franchise agreement helps the distributor to ensure maximum efficiency in their operations so that they are able to develop the business accordingly.
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