International Business: The New Realities, 5th Edition

Screening Countries to Identify Target Markets

1. 12.3 Describe the method firms use to screen countries to identify target markets.

Screening to identify the best countries is an essential task. It is especially important in the early stages of internationalization. For most firms, it is also the most time-consuming part of opportunity assessment. Failure to choose the right countries not only results in financial loss; it also incurs opportunity costs, tying up resources the firm might have used more profitably elsewhere.

Exhibit 12.2 depicts the McKinsey Global Institute’s Global Connectedness Index. This tool ranks countries with respect to their inflows and outflows of goods, services, finance, people, and data and communication. For example, ...