Join Doug Ladd for an in-depth discussion in this video L is for "legal', part of Marketing Foundations: International Marketing.
- The U.S. has about 370 lawyers for every 100,000 people in the country. Sweden, has about 50. China, closer to 10. For companies considering a move into a new geographic market, the legal aspect is an important consideration. There are four main legal frameworks around the world and you need to be aware of the differences you may face. Systems of Common law such as those of the U.K. and U.S., are based upon previously accepted customs and precedents set by the courts.
Code law, is another type that is seen in Germany, Japan, and other countries, where virtually everything is covered by written rules or codes. Islamic law is different still. As is the commercial legal system used by Marxist/Socialist countries. Let's say you run a bank in the U.S. and you're thinking of getting a piece of the growth happening in the United Arab Emirates. Dealing with Islamic law where it's not legal to charge interest on loans, might make you rethink your decision.
The respect of patents and your ability to protect your intellectual property, is another key consideration. Countries with a Marxist/Socialist bias, tend not to respect the patent laws of Common and Code law countries. Why is this a big deal? For many brands, the number of counterfeit and knockoff products being sold in non-authorized retailers is alarming. Not all of those Rolex watches you see out there, are real. To prepare for your International expansion, you need to asses the legal environment in the new market.
You can start by visiting buyusa.gov and cia.gov. The website transparency.org is another great source of information. On these sites, you can learn about the legal structure, as well as get direct information on what is required to register your business in other countries. To help organize the information you're going to uncover, I would recommend creating a spreadsheet where you can visually display the considerations important to you and your business.
You start this by listing the items that you need to know about each country across the top. For example, does the country require registration? Do you need to have a local address? Are there laws related to the handling and transportation of products like yours? Are there limitations on disposal or recycling? Does the country have a history of respecting intellectual property laws in your industry? You may come up with several more, but this gives you an idea of where to start. When you combine all the factors in the PESTCL analysis, you now have several sheets where you can aggregate the data and give a snapshot of which country or countries look the most attractive to you.
How did your analysis turn out?
The course also investigates options for global expansion, such as exporting, licensing, joint ventures, and direct investment, and details how to put together a successful marketing mix using distribution, promotional methods, and translation. Plus, learn where to turn for more information about your specific target markets.
- The rise of the global consumer
- Learning about customers in global markets
- Accessing foreign markets
- Adapting products
- Balancing risks and rewards