Can I talk about synergies for a market entry? If no, what's the right term? Thankss

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New answer on Nov 17, 2019
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Anonymous A asked on Nov 17, 2019

Thanks!

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Antonello
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replied on Nov 17, 2019
McKinsey | MBA professor for consulting interviews

Hi,
I would prefer "advantage" or "benefit".

Best,
Antonello

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Vlad
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replied on Nov 17, 2019
McKinsey / Accenture Alum / Got all BIG3 offers / Harvard Business School

Hi,

You can have synergies when the two companies are merging:

  • Revenue synergies
  • Cost Synergies
  • Financial synergies

I don't see how it's applicable to market entry unless you are acquiring a local company.

It's applicable to talk about key capabilities that will allow you to win the market share

Best

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Deniz
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replied on Nov 17, 2019
BCG | A.T. Kearney | University of Cambridge | 350+ coachees | 5+ years of consulting experience in London, Dubai and Istanbul

Hi,

Synergies could be applicable if M&A is involved with the market entry strategy. Synergies can be realized with top-line (additional revenues) or bottom line (lower costs) growth. There are also negative synergies (i.e. additional investments required in marketing etc.) that one needs to think about as well.

Best,

Deniz

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Carl
Skilled
replied on Nov 17, 2019

Look at capabilities.

Best.

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Anonymous B replied on Nov 17, 2019

I agree with the other comment.

When looking at "synergies" for a market entry case, I would rather refer to this as the "current company capabilities". Here, you will be able to look into currently established distribution channels, cross-selling opportunities, connections/relationships, etc.

Naturally, I tend to connect the word "synergy" with M&A activity and you don't want to give the impression that you're mistaken on what the client is looking to do.

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Federico
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replied on Nov 17, 2019
Former Bain (4+ years, UK & Italy) | Ardian (France) | Specialized in Case Structuring, Case Cracking and Non-verbal Comm.

Hi,

the definition of "synergy" will help you. A synergy takes place when the combined value and performance of two companies will be greater than the sum of the separate individual parts.

Depending on the market entry strategy, if it is rolled out by making mergers and acquisitions (e.g. Company X acquires local company Y to enter the ZZZ market), there could definetly be potential synergies to evaluate.

Hope that helps!
Federico

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Antonello gave the best answer

Antonello

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McKinsey | MBA professor for consulting interviews
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