The impact of order and mode of market entry on profitability and market share

Market share performance and profitability of overseas business activities has long been an important issue in international business. In this study, we explore the impact of order and mode of market entry into an overseas ma rket. We find that early entrants have significantly higher market shares a nd profitability than late followers. We also find that equity joint ventur es have a higher profitability than either wholly owned operations or contr actual joint ventures. A significant interaction exists between order and m ade of market entry. As expected, firm efficiency and size affect the perfo rmance of firms, These results are based on the business activities of a sa mple of 14,466 foreign firms in China in 1995.