Chain Reaction

Need To Know

What to ask before you launch an international chain.

Experts agree, launching a new chain of stores in America is risky enough. But what if your aspirations prompt you to debut your concept in a foreign land instead? We asked Wesley Johnston, a professor of marketing at Georgia State University in Atlanta, to highlight the factors that can either make or break your business.

  • Will the product sell well in the targeted culture? Think market research. The good news is most American products and services are embraced overseas. But, for example, if many of your potential consumers are typically lactose-intolerant, you'd want to steer clear of opening an eatery that sells cheese pizza, says Johnston.
  • Is your target market familiar with your product or service? If not, be prepared to invest a lot of time and money in consumer education. On the flip side, if you're the first one to introduce a new and exciting concept, "The product then becomes synonymous with your company name or chain," Johnston explains.
  • Do you feel comfortable in that country? Since you'll probably have to temporarily live there to operate the chain in its early stages, you'll need a working knowledge of the language and culture.
  • Consider the infrastructure. Can you get Western-style accommodations and support? How good are the roads? Is your supply guaranteed? What about the reliability of hot water?

"It's a big, big world out there," Johnston contends. "I don't think there's any one idea that won't work somewhere."

Contact Source

Mike Shogren, c/o Siberia-New York Pizza, 3020 Irving Ave. S., Minneapolis, MN 55408, (612) 844-6434

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This article was originally published in the April 1998 print edition of Entrepreneur with the headline: Chain Reaction.

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