Foreign market entry modes

For international trade, Foreign market entry modes are the ways in which a company can expand its services into a non-domestic market.

There are two major types of market entry modes: equity and non-equity. The non-equity modes category includes export and contractual agreements. The equity modes category includes joint ventures and wholly owned subsidiaries. Different entry modes differ in three crucial aspects:

• The degree of risk they present.
• The control and commitment of resources they require.
• The return on investment they promise.