A Thought on Foreign Market Entry Processes: From the Cases of Japan’s Service Businesses

Abstract

This study examines decision-making processes of Japan’s service-related companies entering emerging markets. Findings include: 1) Entering emerging markets is generally a pre-decided corporate policy, and the decisions are often influenced by specific personal events; and 2) Pre-decision research is not likely to have a substantial impact on decisions. Based on these, two hypotheses emerge: a) Small-Start Hypothesis: Market entry is decided in practice by the time FS is conducted; and b) Loss-Cut Averse Hypothesis: Firms find it difficult not to enter a new market after investing in research. This study suggests a new perspective on foreign market entry.