Crafting a comprehensive growth model in the Middle East region: the case of Chabros s.a.r.l. entry into the Dubai wood trade industry

Abstract

Firms attempting to seize new business opportunities for growth through foreign market investments often face complex strategic decisions. The complex international environment is affected by diverse variables, creating risks that are not encountered in the domestic market. This study investigates both country-specific and market-specific factors that should he studied before the expansion strategy is implemented, and formulates a risk assessment and decision making model, applied to the Middle East region in particular. Thus the research hypothesis states the following: This model provides a basic strategic direction upon which the company will base its entry mode and risk dissemination decisions. For application, a specific industry was chosen and studied, the wood trade industry. taking the case of a specific Lebanese-based company, Chabros s.a.r.l., aiming to expand its operations to Dubai, United Arab Emirates. To test the research proposition, a survey was conducted comprising businessmen and academic persons who were chosen as to be familiar with both Dubai as a business investment center and the Dubai wood market and/or construction industry, as the two being directly and closely related industries. Analysis of the means and the normal frequency distributions of each variable studied, generated a clear idea on what are the most critical country-specific and market-specific variables affecting the Middle East region, and thus on which the expansion strategy must be based. The variables were integrated in a comprehensive model resulting in both a country and market attractiveness index grading. In summary, the results supported the country and market specific factors included in the survey as valid indicators to include in the strategic planning process for international market expansion in the Middle East region. thus providing a basic direction for entry mode decisions.