CHAPTER 1
INTRODUCTION
1.1 Background
With
the
globalization,
international trades
have been growing at a
faster-than-ever rate.
One of the
factors that
had contributed to the growth of international trade would be the
growth
of
service
industry. Although
the
service
industry
plays
an
important
role
in
global economy, literature on service internationalization remains sparse. As for Country
of Origins,
most of
the
studies on COO are about products
where study of COO effect
on service is little.
Indonesia,
amongst
the
fastest
growing
developing
countries,
has
huge
business
potential. Therefore, many foreign businesses seek opportunities to enter Indonesian
market.
However,
not
all
foreign
businesses
will
succeed
in
Indonesia.
Foreign
businesses before entering Indonesia have to evaluate factors such as their target market,
economic
condition,
company
reputation,
and country
of
origins
effect.
Different
industries have different perceived risks, and trust on foreign companies depending on
company
reputation
and
country
of
origin.
Ethnocentrism
would
be
another
important
factor to be considered about.
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