The group are considering two target markets.
Option 1: enter the Asian market
Emma strongly prefers this option. She recently presented IBAT at a medical conference in Asia. Great interest was shown and some attendees wanted to purchase samples at the conference. However, sales in Asia are not possible, because IBAT has not yet met regulatory quality standards there.
Falit also prefers this option because significant economies of scale could be gained. He also fears that other businesses will launch a similar product in Asia. The costs of entering the market would be relatively small for Medimatters. A suitable medical equipment wholesaler who could market and distribute the product operates in the region.
Ahmed and Didi are concerned. Quality issues with the lens manufacturer in India are worrying and should be resolved. They would like market research to be conducted to assess the suitability of Asian, as well as European and American, markets.
Option 2: continue to sell in Brazil
Didi favours this option. Always cautious, he thinks that current difficulties should be resolved before further expansion. He forecasts a reasonable first-year profit – far more than most new businesses. Ahmed likes the fact that he would not have to take on any additional workload or travel across the world: he is already struggling to manage his responsibilities. Carlo prefers this option because he wants to avoid the problems of growing too quickly, because many overambitious new businesses fail.
In preparation for the next group meeting, a decision tree showing both options has been produced.
Using the case study and the additional information in this question, recommend whether Medimatters should implement option 1 or option 2.
You will find it useful to calculate the predicted outcome for option 2 in the decision tree.
Refer to case study: Medimatters
