Diploma of Business Management Report 2022

DIPLOMA OF BUSINESS
MANAGEMENT

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Executive Summary
Every company in the age of competition are trying to cross borders so as to improve their
growth. This report suggests that Mini has opportunities to enter into the Indian Luxury car
market. There will be discussion about the external environmental factors of India where it
was found that the external environmental factors are giving them the opportunity to target
the growing numbers of rich people in the nation. However the market environment is also
creating threats such as downfall in the growth of Indian car market. These threats can be
removed with the help of their owners such as BMW who has so many years of experience of
doing business within the country. In this report there will be discussion about the best entry
mode where it was found that they can chose strategic alliance as their entry mode. This is an
effective entry mode strategy as it allows the firm to understand the challenges that might
confront their business in the starting phase. This report will also be discussion the market
segment for the company where it is found that this company’s major target segment will be
the people that are rich and lives a luxury lifestyle. At last there will be discussion about the
porter’s generic strategy and the suggested porter generic strategy that this company can use
is cost focus as it will allow them to attract more and more targeted customers.

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Contents
Introduction...........................................................................................................................................2
PESTLE analysis...................................................................................................................................2
Opportunities and threats...................................................................................................................4
Market-entry option...............................................................................................................................5
Market segmentation.............................................................................................................................7
Porter generic strategies.........................................................................................................................8
Conclusion.............................................................................................................................................9
References.............................................................................................................................................9

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Introduction
The competition in different markets has increased and it is due to this that companies have to
ensure that they are able to enhance their sales and revenue. For this the companies are
choosing the approach of internationalisation. It is critical for the firms to analyse the external
business environment of the country where they aim to move. On the other hand it is also
critical that strategy for entry is chosen wisely. Mini is British automotive marque established
in 1969. It is a subsidiary of the BMW since 2000 (BMWGroup, 2020). They have been
known for their smaller car models. This car can expand in India. In this report there will be
analysis of external environment of India. Market-entry strategies that should be selected by
the Mini in order to expand in India have been illustrated. It also suggests about the market
segmentation of the company along with the porter’s generic strategies that they should use in
ensure to ensure their growth in India.
PESTLE analysis
In order to understand the external market environment it is critical for the firms to analyse
the environment they might face while they expand in India. In order to understand the
external environment the use of PESTLE analysis is critical.
 Political: The government is supporting the new FDIs from different parts of the
world. Government has focused on the development of infrastructure within the
nation. At the same time government has also reduced the complexity of the existing
corporate laws within the firm. At the same time government of India has produced
many skill development centres that would help the company in availing skilled
labourers (Staggs, 2013). However the government has increased the taxes on the
luxury cars. This will have impact on the fast expansion of Mini within India.
 Economic: The Economic environment of the developed market such as European
countries especially Britain is not so good. On the other hand the development of the
Indian market is slow right now but still it is on the positive direction. In the wake of
the global economic downturn it can be seen that Indian automotive market has also
seen a decline but it is a perfect time when the company can make plans to enter into
the market of India as it will give them time to understand the complexity in the
market and when the market will rise then the chance of the company’s growth also

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enhances. It is also the fact that this company has good financial base which will help
the firm in making their expansion plans (Yeh and Choi, 2011).
 Social: There are large numbers of entrepreneurs that are coming up in India and this
can be an effective market segment for the company in the future. If the company is
able to give the EMI option then the chances that lower upper class which is also in
large numbers can also buy the products of this company. There is also large numbers
of people that are skilled that lives in India and the amount of unemployment that
exist in the country it will be easier for the firm to get the skilled employees at the
lower cost. There is also an increase in the demand of the luxury cars which is a
positive sign for the company (Mudambi, Saranga and Schotter, 2017).
 Technology: In the past decade this country has developed itself into the country that
is not only the technology followers rather they are leaders in many ways. People are
highly connected with different types of technological mediums. This will make it
easier for the firm to ensure that they are able to conduct the business operations in an
effective manner. This will also make it easier for the firm to do marketing with lesser
amount of cost. The technological skills of the people has also increased hence this
will help the firm to make sure that they are able to manage the skill requirement in
different business areas (Shende, 2014).
 Legal: Indian government has been trying to reduce the numbers of laws in the nation
so that entry of all the companies becomes easier. However the anti-dumping laws
along with environmental laws have been strengthened to make sure that they are able
to deal with the challenges in an effective manner. Legalities have also strengthened
in the areas of employees rights hence the company will have to ensure that they are
following all the functional related legalities seriously (Atwal and Bryson, 2014). This
is necessary for diminishing any chance of losses or facing any kinds of legal
compliances.
 Environment: It is critical for the management to ensure that they have a plan for the
environment related concerns. This is because in India government has strengthened
the environmental policies hence it is critical for the firms to understand that what
they are producing in the market is according to the environmental norms (Monga,
Chaudhary and Tripathi, 2012). Electric cars will be most welcomed by the people in
the coming years especially when the governments are planning to lift ban on the use
of diesel cars.

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Opportunities and threats
Opportunities
 They have opportunities in terms of the fact that India’s luxury car market is on the
growth.
 They have opportunity in low cost car market and India can be the best market to do
this. This is because there is a very large market segment that is available in India that
is looking for new options in the cars that are available at lower cost (Majumdar,
2010).
 They also have opportunities of expanding their market share in the Asian region
where there is huge population and this area is having many emerging entrepreneurs.
India can be their centre for managing their operations in the south Asian and Asian
region.
 They also have opportunities in bringing the electric cars that are of lower cost than
the diesel cars and India can be one of the best markets for it.
Threats
 Right now the Indian car market is not showing the promising growth which can be a
threat for the company in its initial phase.
 They also have threats such as global economic down turn which will have impact on
the investments that they want from other parts of the world (Gilmore and
Patwardhan, 2016).
 The threats such as increase in the uncertainty in the diesel car market hence the
existing products of the company will face sustainability related challenges.
 Threats such as increasing Taxation will have impact on their growth in the coming
years. This will also have impact on their cost and their plans of making India as their
centre in the Asian region.
In order to overcome these threats there are several other things that can be done by the Mini.
Some of these things are:
 They can take the help of Indian investors that can help of them in raising funds
which will allow them to make fast expansions within in India and reduce the threats
of global downturn (Coste-Manière, Panchout and Molas, 2012).

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 In order to reduce the threats such as uncertainty in the diesels car market they can
bring new electric cars in the market that will help them in improving the numbers of
people that comes under their targeted market. It will also help the firm in finding
competitive and strategic advantage in the market (Nunes, Bennett and Shaw, 2016).
 India will be an effective market to reduce their cost of operations and the resources
price in India is on the lower side. This will help them in dealing with the threats such
as increasing cost due to increasing taxation.
 This company can also take the help of their owner firm i.e. BMW which has been
highly successful in the market of India. They can provide them support in terms of
facing the initial barriers of establishment. BMW can also help them in dealing with
the challenges such as competition in the market and also helps in managing the
supply chain operations within the firm (Okulicz-Kozaryn, Nash and Tursi, 2015).
Market-entry option
For an organisation it is always critical to understand the challenges that they might face
when they will enter in the Indian market. In order to ensure that they are able to reduce the
barriers it is critical that they select the entry mode effectively.
Some of the entry mode options available with the firm are:
 FDI: This is an entry method in which Mini can invest directly in the country.
Government of India is also promoting such kinds of investments. In this Mini can
open its manufacturing centre in the nation. This will ensure that they do not face
much of the challenges about how they want to do their business in the nation. The
advantage of this type of investment is that it allows companies to make policies
according to their need and there are very less external factors that can manipulate
them. However, the disadvantage is that they will have to invest higher amount of
money on developing the market for them (Krishnan and Jha, 2011).
 Strategic alliance: This is also an effective method through which Mini can enter into
the India. The major reason for it is the fact they have all the resources and products
necessary for doing business but the local resources such as supply chain, logistics
and human resource management can be easily availed if the company has some kind
of strategic alliances with the companies that are providing such kinds of options. The
advantage of such entry-mode is that it allows a firm to easily avail all the required

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resources and that too on time (Horn, Forsans and Cross, 2010). On the other
disadvantage include the fact that they have to share many details about their business
to their partners which can be dangerous for the strategic advantage that firm has on
the other firms as they can steal some information.
 Mergers and Acquisitions: It is essential for the firms to reduce the challenges that are
faced by the firms in term of understanding the market and generating funds from
within the market. In this regards the use of such strategy where either they could
acquire any firm or they could merge them with any existing firm in India can be
beneficial. The advantage of this mode of entry is that it helps the organisation in
increasing its resources and enlarges their scope (Biswas, Mukherjee and Roy, 2014).
The disadvantages include the fact that it reduces the autonomy of the company in
terms of taking decisions especially when it comes to pricing and policy design.
The nature of the Indian market is complex. This is because people are highly sensitive over
pricing and the cultural values they have. It is also seen that in India the loyalty factor is on
the higher side. In order to understand the market condition, companies might take time
especially when they are coming from different parts of the world where the culture is
different (Srivastava, 2013). This is why they need to select the Strategic partnership as the
entry option. This is because it helps the firm to reduce the challenges that they might face in
understanding the market especially in cultural terms. Strategic partnership also helps the
companies in improving their knowledge in different strategic areas as both the firm will
combine their knowledge for making new products and delivering to the customers as per the
market and hence will give the firms a better chance to gain higher profits (Ray, 2012). It is
also the fact that there is an increase in the competition in the market and hence such type of
mergers will help the companies in improving their efficiency which is very much critical in
the current time. Since one of the companies will be from India hence they will have the
knowledge about the supply chains and people management that could help the organisations
in improving their local efficiency. Strategic alliance allows the companies to speed up the
expansion process. This will help the company in maintaining their brand image and they do
not have to compromise with the quality and the name with which they are doing their
business. Since Mini is known for its high quality luxury cars hence this entry mode strategy
will benefit them.

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Market segmentation
For any organisation that aims to expand their business in the new markets, they need to have
knowledge about the preferences of the customers in that country. For this they need to
segment their market according to different parameters. Mini also uses different kinds of
parameters to ensure that they are able to segment the market perfectly and ensure that when
they target the people they are able to generate the sales which they have expected
(Altenburg, Bhasin and Fischer, 2012). The segmentation also has impact on the strategies
being made within the firm. The segmentation for the mini and on the basis of the parameters
has been illustrated in the table below:
Types of Segmentation Segmentation Criteria McDonalds target segment
Geographic Region India
Density Urban
Demographic Age 25-65
Gender Male and female
Life-cycle Stage Newly married couples as
well as young bachelors
Income High
Occupation Entrepreneurs and business
owners
Behavioural Benefits sought Time efficient
Degree of loyalty Switchers and Hard core
loyal
User Status Luxury car lovers
Personality Careless & Easygoing
Psychographic Lifestyle All the mainstream people
that are having higher salary
or income and the ones that
wants to live a luxury life.
Social Class People from higher class of
the society.
This type of segmentation has been done by the company in order to ensure that they are
targeting the right kind of people. In this their major target segment is the people that belong

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from high class society and also the people that are having luxury demands in the car
manufacturing market. Their major reason of focus will be the metropolitan cities in the
market. Since the entrepreneurs in the country that owns their business is increasing and
hence the chances that the sale of the luxury cars will enhance (Chakraborty and Sheppard,
2016). This will also help them in positioning them as the company that is building luxury
cars at the luxury prices but lower than their other competitors. Mini does not have such
luxurious brand image in the country as their other competitors like Aston Martin has. It is
due to this they will also have to invest on the marketing strategies that will improve their
position in the market.
Porter generic strategies
In order to ensure the growth in the market the use of porter generic strategies can be highly
critical. These are the strategies that help the companies in making fast penetration in the
market which is very much critical for the company. Porter generic strategies are as follows:
 Cost leadership: It is a strategy in which firms reduces their cost of the products to the
lowest level or say to the level that they become the price leader in the market among
all the competitor’s products. This is an excellent strategy to attract new set of people.
In India where the people are highly sensitive towards prices this strategy can be
highly effective (Verma, 2015).
 Cost focus: This is the strategy in which company brings the pricing that is focused
towards attracting people that they have targeted. The pricing are being set to attract
the potential customers which enhances their chances of higher sales. This is a better
strategy especially for the people that are thinking of purchasing the car
(Roychowdhury, 2010).
 Differentiation leadership: This is also an effective strategy that helps an organisation
in differentiating them from their competitors on the basis of the products. If the
company will be able to differentiate them in front of the competitors they will be
able to attract the people as well because they will offer the people what no one else is
offering (Jain, Roy and Ranchhod, 2015). In the car industry this is very much
effective strategy especially when the innovation is driving this industry. Technology
and safety is the major point of differentiation that most of the car companies they are
focusing on.

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 Differentiation focus: It is a strategy that is being used by the firm to give options to
the people that are actually their target segment. This helps the company in
differentiating their products on the basis of what consumer’s demands are. Higher
focus is given on the demands of the people whom they have targeted. This allows the
company to achieve desired numbers of sales (Hilliard, et al 2012).
The porter generic strategy that this company must select while entering into India is a cost
focus strategy. These because as stated earlier also Indian purchasing behaviour is guided by
the cost and people are highly sensitive towards the price at which the company is offering
their products. If the company is able to bring products in the Indian market according to the
price that is demanded by the customers then the chances that they will succeed in the market
increases (Enderwick, 2012). The pricing should be lower in the luxury car segment. This
must be supported by the extensive marketing campaign that could help the firm in improving
the brand presence in the country. This is also necessary because like their competitors this
company is not very much known and the customers that will purchase this product will be
on the basis of the fact that it will show that they own the luxury car. In order to carry on with
this marketing strategy they need to ensure that their cost of production in the nation is on the
lower side.
Conclusion
From the above based report it can be concluded that Mini is one of the luxury car makers
from United Kingdom and India is an effective market for their growth. The PESTLE
analysis suggests that they have the opportunity to enhance their sales in terms of the fact that
there are many rich people that are coming up in the country which can be a market for Mini.
It also suggests that threats such as global economic crisis can be a challenge. For removing
this they need to attract investors from within the nation. They need to choose strategic
alliance as an entry mode strategy. They need to segment and target people that are rich. The
porter generic strategy that they can choose is cost focus.

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