Understanding Family Firms’ Entry Mode Choices When Going to China and India: An International Opportunity Identification-Based Approach

Abstract

This chapter uses an international opportunity identification-based approach to understand specific foreign market entry mode choices of family firms. We employ an exploratory case study design based on ten German family firms’ entry mode choices for China and India. Our main findings suggest that for first-time entries, the type of international opportunity identification—accidental or purposeful—influences foreign market entry mode choices. Family firms that accidentally discover international opportunities choose an international joint venture, whereas purposeful searches lead to a selection of the most suitable foreign market entry mode only after careful consideration of different possibilities. Further, the perceived cultural distance of the target market impacts accidental opportunity discovery, a test phase carried out prior to market entry explains the dynamics of purposeful opportunity searches.