A manufacturer of children’s clothing is considering expansion into international markets. Outline the process which this organization could use to systematically analyze and compare potential markets. Highlight any problems which could arise when collecting information to help with this decision. (300 words) Answer: Most comprehensive process to acquire insight on making progress on international corporate ventures is through market research and analysis. Foremost, the company should understand the market requirements in the international market.
This is through information and market survey through available date and the mother country liaisons’. Information about the children clothes is more commonplace in journals about parenting and internet resources. However this serves as general references and analysis data, the most sufficing intelligence is based on surveys and market research. Company executives should visit the countries which they have analyzed as viable markets. Executives will meet the investment secretaries in these countries and discuss their incentives and have information on requirements of investing or directly exporting their products to this market.
The executives should be able then to understand the economic implications, standards and health of the market. They should check on inflation, economic growth to avert forex losses and capital value. The process of coming up with strategic market policies will come from this market survey. If the market seems viable and that the clothing industry within the market is ready for fair competition with international brands, then the company will evaluate the long-term financial commitment required in the venture over a certain period so as to assess growth of this foreign investment venture potential growth rate and profit gain margin.
The company will look at the checks and balances of the quality and market share of the other international brands, hence, have a general overview of the competition level and the brand market share so as to comprehensively poise their products for the market. The company should be keen on market requirements and regulation requirements. Inflation could force value of investment to go down while there could be un-welcome reception by the local competitors who enjoyed monopoly.
This applies within the scope of the British Tesco issue with Kenyan flower exports, whereby Tesco was complaining about environmental implications by the flowers but had no genuine case in particular. 2 Critically assess the reasons why it might be more difficult for service organizations to be successful in new international markets than it is for manufacturing organizations. (300 words) Answer: The change of corporate governance policies and service provision regulation by various global economies projects the versatility of the market and also the aggressiveness of the companies in the service industry.
This means there is more profound market share in terms of corporate establishment and tenure in the market. This creates a complex where in it is very difficult to penetrate the service industry market else where due to this aspect. In fact, competition level is far higher due to quality of service and similarity of the services to the extent that the issue is no longer quality but the truly profound is the price and outlook of the service. This makes manufacturing to have a more diversified portfolio in terms of corporate diversification.
It means it is easier to establish subsidiaries or sell products abroad than establishing service provision subsidiaries abroad. Manufacturing’s great leverage is from the technology point of view. The need for technology is very high especially in growing economies where manpower is available but technology and fiscal power is absent. This is a vacuum which manufacturing sector takes advantage of and makes quick entry in comparison to service provision. An example is the insurance sector, whereby companies struggle for years to make gains and subsequently collapse while a company like General Electric quickly makes entry and profits.
Service provision is less convectional and has no client based assurance. Economic weather might force bad economic weather and reduce client’s fiscal power to purchase a service. This obviously is pre-empting insulation and gradually the service company wears away and collapses. On the other hand there is more insurance due to requirements in the manufacturing industry. Customers want to have products and varying reasons force them to consume more or to have needs that required the products. Please answer these two questions individually, by using International Marketing theory and relevant examples.Sample Essay of PaperHelp