Internationalization of Davison Canners in the United States: Analysis and Recommendations

This report provides an analysis of the internationalization of Davison Canners in the United States, including the rationale for going international, recommended country, typical barriers, and approach for internationalization.

International

Table of Contents
EXECUTIVE SUMMARY..................................................................................................................
INTRODUCTION................................................................................................................................
ANALYSIS AND DISCUSSION........................................................................................................
1 Overview of the organisation and rationale for going international.........................................4
2 Critically discussion and Reasons to Recommend Country.....................................................5
3 Typical barrier that will be faced as the organization expands internationally........................6
4 Approach for Internationalization.............................................................................................8
CONCLUSION..................................................................................................................................
REFERENCES...................................................................................................................................
BIBLIOGRAPHY..............................................................................................................................

EXECUTIVE SUMMARY
Internationalization of business always refers in terms of capital expansion as well as the
growth of the organization, where recent trends are widely expanding competitively on wider
horizons significantly. Following research has presented detailed analysis on internationalisation
in businesses, usage of best strategies and focus on vision for channelizing effective resources. In
this report the case study on Davison canners took place, the discussion has rationalized behind
the motive of international expansion in USA, the barriers company has faced within the
different culture of other country. The research further focused upon the global approach strategy
company has used for the internationalization of their business, to enhance growth and
competitive market establishment.

INTRODUCTION
Internationalization refers to the plan or strategies for trading outside the domestic
country with the motive of increase in sale and having large number of customers Going
international develop the business in many ways. Davison Canners Limited is food production
company which has its market only in United Kingdom It is successfully running the local
market. This report will discuss the current position of the company, reasons for going
international and critically discussion along with the trade relation between the chosen country
and United Kingdom. Report will also discuss the typical barriers that will be faced while
internationalization of the Davison Canners. With the help of analysis on all the topics it will
also show what approaches a company should take for its internationalization and the reason
behind that will also be critically discussed below.
ANALYSIS AND DISCUSSION
1 Overview of the organisation and rationale for going international
Davison Canners limited is a private local company produce speciality food, jams, bakery
fillings and preserve fruit and vegetable (D&B Business Directory, 2021). It is a medium-sized
business with number of employees between 50 and 250 located in the country of UK. It
provides variety of food products in unique range of flavour. Davison canners is active in the
field of the rental of investing property, canning, distribution of apple products pudding
production and sales. Company is successfully leading the local market in field of food
production.
Davison Canners is a successful company in local market and it keeps innovating its
products which is one of the main rationale for going the selected firm internal. Delivery services
if this firm is quick and maintain quality of food. Company also had created jobs for 50 new
employees by introducing new dessert range after securing 4.2 Million dollars financial package
from HSBC (Stones, 2017). Going internally will benefit company as well as people and country
as they will have a new variety in the food product. Davison is investing and reinvesting in the
business along with the customers. Business always catch up to the trend and try to provide new
products and flavour to its consumers. Unique flavours of Davison Canners is the strength of the
company to expand itself into other countries. It will create a new competition to the other

international company in the field of food products specially in Jam variety because it has its
own occupied land for growing foods which are used for manufacturing and business always
maintain the quality of food. Consumers feedback of the company is very good they are satisfied
with the products. Internally Davison canners can lead the market its innovations, quality and
wise range of food products (Shams, And et. al., 2021).
2 Critically discussion and Reasons to Recommend Country
There are many countries in which Davison canner can trade successfully and lead the
market in terms of food products. Some of them are United States, Germany and France. To
grow internationally smooth along with low barriers, company should start its first international
trade in the United States of America.
One of the main reason behind that is United Kingdom has very strong trade relation with
United States. It will help the business to trade easily. It can be critically discussed that
geographical distance between US and UK is too far as compared to Europe which will increase
cost of transportation but still it will be easier for the company to trade in US because of the two
nations negotiated a Free trade agreement. It will help the business to expand its production
internationally with low cost of tax on import or export. Europe could have been a better option
for the business but after Brexit it has become harder and costlier for UK companies to trade in
Europe.
Davison Canners is popularly known in UK which will help the business to go
internationally in US too. United States is the world's largest economy country and largest
exporter and importer of goods and services which will benefit the company to have bigger
market. In a critic way company will also have to struggle with other food companies as larger
economy comes with larger number of business firm or competitors. Benefit of choosing United
states of America for international trade is also that it has huge number of consumer in the
country. US also import the large no. of food products including fruits and veggies which is also
an opportunity for Davison to trade in this country (Sinha and Chowdhury, 2021). The Quality
food products that is provided by the business will also help the business to grow in US.
However, it can be critically discussed that problems will also arise in starting international trade
in US because of expensive raw materials or property in the country and risk of failing is always
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there. People of US are likely to try new things specially in food products, It will give a good
start to the business to have a good start.
Trading in united States makes the business learn. As US is world's largest economic
country, companies of other country trading in US learn a lot from it in so many terms including
technology, marketing skills, customer behaviour and much more. Although the market of US is
so wide that company may not rise or may lose the efficiency because of the increase in the
demand but it will help the business to understand the economy or the various aspect of
international trade. With the new free trade agreement between United Kingdom and United
States of America the trade barriers for UK are reduced by 50 percent (Conley, H., 2020). This
will help Davison Canners to sale its products at low price by which it can create demand in the
market and can run effectively. Anglo-American Free trade agreement can be the most effective
reason to choose US for international over other countries.
Once a business is proved success in US it becomes easier to expand it in other countries.
Presently Davison Canners is only dependent on local customer after going internationally in
united States company will have larger market so it will not have to depend only on local market.
Business will have new things to innovate as wide economy has more trends, there will also be
change in technology. In a critical discussion US has different culture as compared to UK's
culture, change in culture will arise challenges to the company in different ways such as taste of
people, their perspective. Market change in the country of US is unpredictable this may lead to a
huge fall for a company which just has started business in the country but probability of having
good success is also there. Davison Canners is a successful company in the country of united
kingdom having upper hand in the market of food product which is one of a great reason to
choose United States to expand the business internationally. Company has an advantage to trade
in the selected country because of its product, large economy, demand of goods and trade
relation (Zettinig, and Nummela, 2020).
3 Typical barrier that will be faced as the organization expands internationally.
An organization faces lots of challenges as well as the issues on the expansion across the
border of the country. Davison Canners is an UK based company that deals with canned and
frozen foods with the speciality in fruits, jams, bakery fillings etc. The company is planning to
expand its business in the United Sates of America. As there are lots of changes exist in the

country culture, rules, strategies, company faces lots of these expansions related issues on the out
of the border expansion (Davies, Haugh and Chambers, 2019). Some main difficulties are
described as :
 Risk of supply chain: International expansion is one of the biggest challenges a
company can face as well as can not be rushed. It needs time to plan a solid strategy that
can work effectively in the future as well. This factor includes all the operations such as
exports, imports all the logistics as well as the shipping of products. Davison Canners is
planning the expansion in the terms of the puddings, hot to eat bakery products as well as
the canned fruit products. The organization have to understand the laws related to the
local trade, common influences as well as all the material sources. The shipping cost, the
time included in the ship or the time taken to refill the shelf also affects the services an
organization is providing. This throughout understanding can lead to the solution of
supply chain threat on the business expansion.
 Risk involved in talent acquisition and new trainees : As the organization's success
depends upon the employees' talent, skills, productivity as well as the quality of the
services. Whereas the fundamental skills of a talented employee can influence the other
employees of an organization. In the manner of expansion, training of talented employees
also plays an important role as the hiring of new ground staff in the to be expanded
country. As an example Davison Canners have to hire the new staff in USA as well the
training of the existing employees so that they can better involve in the unique on
boarding process otherwise it would be difficult enough as on boarding process operates
remotely (Brummer, 2018). An organization such as Davison Canners can also work with
the Global PEO (stands as professional employer organization) to help find the new
talented employees overseas (Spence, C. and et. al., 2017).
 Legal compliances: Another barrier a company can face is compliances as well as the
rules and regulations. Expanding over more than one country leads to the rules restriction
such as tax, tariff of trades, extra payable fees to the respective country government.
Proper research and the diligence towards the regulation can lead to easy dealing of the
legal factors. Again the global PEO can help the organization to stay updated about the
changes in regulations over the countries. Davison Canners should have to be fully aware
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of the all specific USA trading standard and their procedures so that can can easily deal
with the laws without hampering its expansion with the additional detrimental cost.
 Threat with existing competitive market : Substitutes or the similarities in products as
well as the services can lead to the unwanted competition among the market and became
one of the main threat during expansion (Rosen and et. al., 2021). USA has many of
existing companies that deals with the product list same as the Davison Canners, so that
the company will face rivalry for sure. As the existing companies already have a
customer base so it will become a major challenge to the Davison Canners to attract the
customer towards its products, so it can be a better way to have the knowledge in the
favour of batter market understanding.
There might be other barriers as well to be avoid to have an easy and healthy expansion
including immigration and screening of the employees, pay roll of the employees, HR
complications as well as the obligations, language, culture etc (Li, Zhang and Shi, 2020).
Meeting with all the barriers of the internation expansion is pretty tough, it can be avoided with
the proper preparation in the right way to achieve the growth. Moreover, the organization needs
to define their case of business , customer type, regulation research and strategy to avoid all the
obstacle in the path of international expansion.
4 Approach for Internationalization
International Strategies refers to the plan through which a business can sell goods or
services outside its domestic market. Target Market refers to a particular group or generation of
consumers for which business mainly produce goods or provide services. Before selecting an
appropriate approach for selected business, Target Market need to be observed and the main
target for the David Canners is Youngsters or Teenagers. Company always have to keep in mind
that the senior management of the chosen country keep up with the trend (Palalić and et. al.,
2021). There are various Approaches for Davison Canners for Internationalization in United
States. Following are three main international strategies available for the company to start
business in the selected country :
(1) Multi-domestic Strategy
(2) Global Strategy(3) Transnational Strategy

 Multi-domestic Strategy : A multi-domestic Strategy is highly based on marketing
approach based on needs, culture, preferences of the particular group of nation. Group of
People are observed and product is customized according to the needs and it is advertised
accordingly. Benefits of this approach is that Advertisement in respect to consumer's
preferences, culture and need attract them towards the product in the Particular Area. Global Strategy : It refers to the strategy made by the company to develop its growth
outside its domestic area with the aim of increase in their sale with low cost. Business
does not modify their product according to the local culture because of the cost involved
in the change or modification.
 Transnational Strategy : Some Businesses modify their product according to the need
and culture also try to balance the cost involve in the process such approach is called
Transnational Strategy. Balancing the needs and the efficiency along with the cost make
the product a little cheaper also touches the culture of the target market (Luo, 2021)(Rao,
2021)
Based on the analysis and the target market Davison Canners Should use Global
Approach for stepping into the international trade in the United States. Following are the reasons
behind choosing global Strategy most suitable for the given company
 Low cost : Internationalization through global approach has been found successful to
many companies. Target market of the selected firm is youngsters, most of the
teenagers are influenced by the good quality at low cost which is most relevant to this
strategy. Food products are generally preferred by the taste and quality not by the
advertisement. People of USA are living modern lifestyles and youngsters of this
country has less impact of culture.
 Advertising is time consuming and costly : Due to geographical gap between
countries, company should invest more in transportation for the freshness of the
product rather than researching, analysing and investing too much in the
advertisement (Ghauri, Strange, and Cooke, 2021). Service of the company
should be in care because it has greater impact on the target market. Before going
global Company should analysis demand, suitable location for the business and
research about the barriers or challenges mentioned above for the improvement in
the internationalization of the given firm.
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In critically discussion of the global approach business will face issue regarding the
foreign culture but in order to develop the Davison Canners into international market company
have to choose which is best for the firm. Not all consumers have same perspective some will
neglect and some will attract.
 Utilization of resources and time : Company will cover the loss of not preferring
multi-domestic strategy or Transnational Strategy with the saving from the cost
including in the strategies and low priced product will increase in demand. Focusing
on the typical barriers and finding solution like giving culture training to the
employees will make the performance better for the organization.
However In critical discussion of global approach there is always ongoing operational
risk as global strategy is involved in international political partnerships, change in economy or
political party can be a great risk to the company.
 Already succeed Domestic Market : Davison Canners is a food producing company
leading the local market which can beat the global market with a proper strategy in
the field of food products with its innovating nature and unique variety of flavours in
jams and US is very good field for Davison Canners to expand its business
internationally (Ferraro, 2021).
CONCLUSION
From the above discussion it can be concluded that Davison Canners is successful company
known for its quality and variety of food products. UK and USA has good trade relation so
Davison Canners chose USA as its first country for internationalization. One of the main reason
was the free trade agreement between UK and US. Due to long distance between both country
company have to invest more in transportation. US has the largest economy came with both
opportunity and challenges for the business in terms of trading in foreign country. Typical
Barriers faced by the given firm was risk involved in talent acquisition and new trainees and
supply chain, legal compliances and Threat with existing competitive market. Approach for the
business to grow internationally was Global Approach with reasons of low cost, utilization of
resources and time.

REFERENCES
Books and journals
Ferraro, G. P., 2021., The cultural dimension of international business. Prentice Hall.
Brummer, V., 2018., Community energy–benefits and barriers: A comparative literature review
of Community Energy in the UK, Germany and the USA, the benefits it provides
for society and the barriers it faces. Renewable and Sustainable Energy
Reviews. 94. pp.187-196.
Davies, I.A., Haugh, H. and Chambers, L., 2019., Barriers to social enterprise growth. Journal of
Small Business Management. 57(4). pp.1616-1636.
Ghauri, P., Strange, R. and Cooke, F. L., 2021., Research on international business: The new
realities. International Business Review. 30(2). p.101794.
Li, Y., Zhang, Y. A. and Shi, W., 2020., Navigating geographic and cultural distances in
international expansion: The paradoxical roles of firm size, age, and ownership.,
Strategic Management Journal. 41(5). pp.921-949.
Luo, Y., 2021., A general framework of digitization risks in international business. Journal of
International Business Studies. pp.1-18.
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leadership styles. International Entrepreneurship and Management Journal. 17(1).
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Rao, S., 2021., International Business Environment. Himalaya Publishing House.
Rose, L., and et. al., 2021., An Overview of the International Business
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Shams, R. And et. al., 2021., Strategic agility in international business: A conceptual framework
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Sinha, D. and Chowdhury, S. R., 2021., Blockchain-based smart contract for international
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Spence, C. and et. al., 2017., Money, honour and duty: Global professional service firms in
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Zettinig, P. and Nummela, N., 2021., The future of international business research: theorising on
unfolding phenomena in a complex, dynamic world. In A Research Agenda for
International Business and Management. Edward Elgar Publishing.
Online references
D&B Business Directory, 2021. [Online]. Available trough <https://www.dnb.com/business-
directory/company-
profiles.davison_canners_limited.7ade3f774e3c67d6eed09b6852be553f.html>
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trough <https://www.foodmanufacture.co.uk/Article/2017/11/14/Food-firm-creates-50-
jobs-with-3.1M-investment>
Conley, H., 2020. The Strategic Benefits of an Anglo-American Free Trade Agreement. [Online].
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trade-agreement>
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