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Report of ALDI business Expanding from EU to China - Desklib

   

Added on  2020-06-05

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An analysis report of ALDIbusiness expending from EUto ChinaAs part of StrategicMarketing (MG624) module
Report of ALDI business Expanding from EU to China - Desklib_1
EXECUTIVE SUMMARY This is to demonstrate the nature of this report that was based on the adopted strategies of aselected retail business operator called Aldi. The findings of this report were based on varioustheoretical models that was applied to acknowledge the existing position of the chosen firm. Thisnot only assisted in analysing both its internal and external elements but has also helped inassessing its contending position in the market in comparison to its competitors. This alsoinvolved the specification of strategies like porter’s generic, segmentation and targeting, etc. Forthis purpose, China was chosen as the newly proposed market for a successful implication ofAldi’s expansion in a specific region called Shanghai. The end result of this report has shownsome favourable aspects with positive consequences of expansion in Shanghai, China.The first part has carried out the pestle analysis of China so as to check whether Aldi’sexpansion to Shanghai will be beneficial or not. This has revealed some beneficial aspects ofexpansion for Aldi with some major scope of development in the newly proposed market. Secondly, various market entry options have been investigated in this section by firstlyconsidering all accessible alternatives and lastly choosing the most suitable one. Herein, thelicensing approach has been found to be the most effective strategy for Aldi to expand into thenewly selected market of China. Another section of this report has demonstrated the accessible options of segmentationfor Aldi in its newly chosen market in China. This has also discovered some potential aspects oftargeting some specific groups so as to quickly spread their services and cover the entire market.Lastly, porter’s generic strategy has been applied to acknowledge the current state ofcompetition in the newly chosen market. This is basically to know about the contending aspectsof Aldi to beat any intense state of rivalry in the retail sector of China. This has presented somevital findings where Aldi may have a similar rate of risk due to competition, as in its presentmarket.
Report of ALDI business Expanding from EU to China - Desklib_2
TABLE OF CONTENTSINTRODUCTION...........................................................................................................................4PESTLE ANALYSIS OF ALDI:.....................................................................................................5MODES OF MARKET ENTRY.....................................................................................................7Start up a new business in CHINA.........................................................................................8Partnership..............................................................................................................................8Franchising.............................................................................................................................8Greenfield investment strategy...............................................................................................9MARKET SEGMENTATION......................................................................................................10Geographic segmentation.....................................................................................................10Demographic segmentation..................................................................................................10Behavioral segmentation......................................................................................................107 P’s applied on Aldi’s expansion to Shanghai-...................................................................11Product..................................................................................................................................11Pricing...................................................................................................................................11Place.....................................................................................................................................11Promotion.............................................................................................................................12People...................................................................................................................................12Process..................................................................................................................................12Physical Evidence.................................................................................................................12PORTER'S GENERIC STRATEGIES..........................................................................................13Cost Leadership....................................................................................................................13Differentiation......................................................................................................................14Focus.....................................................................................................................................14CONCLUSION..............................................................................................................................15REFERENCES..............................................................................................................................16
Report of ALDI business Expanding from EU to China - Desklib_3
INTRODUCTION Management is the core unit of the business organization, as it helps in managing andmonitoring the functions which helps in assessing the organization. It involves various aspectsthat are inter linked with the company like its evaluation, modification, enhancement etc., Aldi isone of the top leading supermarket chain based on Germany, it has more than 10,000 stores inapproximately 20 countries, as per the reports the overall turnover of the company is 50 billionapproximately. The main aim of this report is analyzing and evaluating each aspect of thecompany based upon the internal and external factors. This analysis is apparent to assist Aldi inacknowledging the strategies that are required to be adopted while operating in China’s newmarketplace, Shanghai with effective policies. It is basically to comply by the industrial normswith another concern of fulfilling the acknowledged requirements of the customers in China. In March 2016, Aldi has established the physical store network in China to expand itsworking in Chinese market. As per the plans administrated by the company, Aldi Sud is going totake the operations of the China. The stores are going to introduce in the Shanghai region ofChina. Aldi Sud is going to build the new distribution center to supply local stores in theShanghai region of China. As because of the different market culture Aldi is searching for someChinese managers and staff members who has experience of working in European Market.While since last one year, Aldi has online presence in China and its operating in web shop on Tmall in China. As the Chinese market and its customers are very critical so it is very importantfor the company to analyze the internal and external environment before evaluating itsoperations. Identifying the strength, weaknesses, threats and opportunities of the market is veryimportant before entering in the new business environment (Pestle, 2014). The growth of the Aldi is rising very rapidly; it sales are increased by 19.8 % in comparison tothe other supermarket stores. The reputation and the goodwill of the Aldi plays keen role inmaintaining its top leading position in the competitive market. As per the reports of 2017, Aldi isawarded as one of the best supermarket for the fourth time. The customers of china are not verycost effective and it can turn to be the strength of the company over there. Also, Aldi is known tohave simplified operations that is in turn evident to assist the company to perform easily in theChinese market. This is also on referring to its decentralized structure with quality productswhere the Chinese consumers are more conscious about the quality in comparison to price.
Report of ALDI business Expanding from EU to China - Desklib_4

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