Target Countries for PMC International Sales
In order to progress with the international business plans of Physical Movement Company, the top three countries to target must first be specified. Research was performed which indicated that the countries of Japan, Germany, and the United Kingdom would be ideal candidates based largely on the percentage of elderly in the population and other health-related statistics and spending data. Each country and its corresponding opportunities and risks will be examined in the body of this report. Japan Twenty percent of Japan’s overall population is aged 65 and over.
As well, the country’s latest statistics from Nation Master show a 3. 9% increase in healthcare expenditures annually and 7. 9% of the country’s GDP is spent on health. Public healthcare funding averages $1,542 per capita and per capital total expenditure on health averages $2,133 per person spent. Japan is ranked number one throughout the world in life expectancy, with citizens reaching an average age of 75 years old. In Japan, there are two practicing physicians for each 1,000 people (“Health Statistics by Country”, 2008).
Additionally, 15% of the world’s economy comes from Japan as do 10% of Internet users (“Business in Japan”, 2007). These statistics show that Japan is the number one market to reach as it is home to the largest amount of potential customers for PMC – both physicians and workers in the healthcare field and the families of elderly citizens are numerous. Although the Japanese are normally not receptive to outsiders, the prior established relationship between countries makes it easier for American companies to gain a foothold. The prevalent use of technology is also a helpful factor in easing communication over a long distance.
According to the World Trade Atlas (2006), the United States is already the largest trade partner of Japan, thus the working political relationship between the countries has already been well established. Medical equipment is the fourth largest import into the country. From the World Investment Report (2007) it is noted that “Its [Japan’s] strengths include a huge domestic market, skilled human resources and advanced technological capabilities, a safe and comfortable living environment, and the potential to function as a business hub for the entire Asian market” (International Business Information, 2008).
PMC can rest assured that its products will be protected; Japan’s economic infrastructure incorporates a great deal of protection involving intellectual property rights. The Japan External Trade Organization was developed to help and support foreign companies which desire entry into the Japanese market. As well, the availability of medical services is undergoing reform with the government beginning to allow more outside services in conjunction with its public health plan (US-Japan Investment Initiative, 2004), which can only mean good news for companies offering products related to healthcare.
From a cultural aspect, the Japanese highly value masculinity, avoid risks and place little value on personal freedom and individualism; personal space, however, is valued. Business cards which are printed in English on one side and Japanese on the other side are perfectly appropriate to distribute. One of the most important things to remember when doing business with Japanese buyers is that the answer of “yes” often means no. It will be critical to use other clues to determine the actual response to PMC’s sales efforts.
Long term orientation is a huge factor in the culture of Japan, thus it will require a great amount of time to establish relationships with principals in the country (Williams, 2008). Buddhism and Shinto are the prevalent religions in Japan. According to Hofstede dimensions (Williams, 2008), this makes the Japanese society highly averse to uncertainty which may result from political, government, business, or social pressure and lead to conflicts or disagreements. This is an important factor to remember when selling products to the Japanese.
There are certainly risk factors to doing business in Japan as well as opportunity, however. Since customers there are very demanding, the products may have to be modified to conform to Japanese standards. Buyers tend to be loyal to local companies, so it may be difficult to breach the local competition’s advantage without a proper selling strategy formulated beforehand (“Business in Japan”, 2007). A substantial investment in time and money will be required, and the risk may or may not pay off.Sample Essay of StudyFaq.com