What is the first step in creating a Foreign Market Selection matrix?

The first step in creating a Foreign Market Selection matrix is to identify demand indicators. This step is crucial because demand indicators provide the foundational data that will be analyzed to assess potential international markets. By pinpointing the key variables that reflect market demand—such as market size, growth potential, consumer behavior, and economic stability—companies can make informed decisions about which markets to pursue.

After identifying these indicators, businesses can then proceed to convert the data into a comparable form, weight each indicator based on its importance, and review the results to draw conclusions about market attractiveness. Without clearly defined demand indicators, the subsequent steps would lack focus and relevance, undermining the effectiveness of the matrix as a decision-making tool.