Overcoming Common Market Entry Barriers


Whether you’re launching a new business or looking to expand an existing one, you may find that market entry barriers end up upsetting your plans. Advanced research and preparation can help identify these potential problems and allow you to strategize workable solutions.

Common market entry barriers are caused by different rationales; some are designed to protect standards and integrity within an industry sector, others aim to protect resident businesses from imported competition, and some are based on the different legislation covering products within each market. In some cases, the market barriers are just sensible caution to prevent substandard or even dangerous products from infiltrating a market. 

Identify potential problems

Before your launch or expansion into a new market, check whether your sector or product is adversely affected by existing licenses or patents in the new location. Sometimes, these are held by one company, so it can monopolise production. Is the market stagnant, or are customers eager for diversity? A good marketing strategy will let your potential customers know you are there.

Know which agencies will licence your products. Are you looking at a sector where different administrative agencies enforce regulations and issue licences? This is particularly true in the pharmaceutical and healthcare sectors, which are subject to different government organisations. This is one area where consumer safety and industry integrity are central to product regulation. If you are in this industry, there are many different organisations and regulation standards to negotiate, so it’s important to know who to contact ahead of your launch. Medical products for human and veterinary use in the UK are regulated by the MHRA (Medicines and Healthcare products Regulatory Agency) as part of the UK Department of Health. The equivalent in China is the National Medical Products Administration (NMPA), formerly known as the CFDA (Chinese Federal Drug Administration), which is directly under the State Council of the People’s Republic of China.

There is evidence that suggests outsourcing can help small businesses grow. Can you find help to negotiate the different regulation processes? One option is to work with an established manufacturer or business partner with products already approved and on sale. Perhaps you want to break into China’s rapidly growing healthcare industry, with its potential for innovation and profit, but find facing the NMPA regulations on your own daunting. In this instance, seek out a resident intermediary service, which will do the legwork using its expertise to introduce you to selected, established companies across China. With this help, you can avoid the barrier posed by international regulations.

Check for sanctions in your sector. If there are sanctions, research if there are products that are exempt and focus on those. Are the sanctions only for a limited period? Can you hold back until that period ends? Could you diversify into an area unaffected by sanctions? Do any limitations or quotas restricting import and export apply to your product? A list of the active UK import controls can be found on the UK government’s website.

 Are you prepared?

Experts agree that market barriers can be overcome. Innovation is key, so think differently and find the gaps in the barriers. How do your prices compare with others in your field? What can you do to stand out? Plan ahead, assess the problems so that you foresee potential difficulties, and think creatively. There is plenty of sound advice available. Most importantly, research as much as possible beforehand so that you know as much as you can about your intended market before committing to the launch.


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