Global Business Perspective

This report analyzes the market entry for UBER in India, using PESTLE analysis, Porter's Five Force model, and SWOT analysis. It discusses the political, economic, social, technological, legal, and environmental factors in India, and provides recommendations for UBER's business initiative in India.

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GLOBAL BUSINESS PERSPECTIVE
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1GLOBAL BUSINESS PERSPECTIVE
Executive summary
UBER is one of the leading riding car service organisations around the world. The company has
a great number of markets in US and internationally. Recently, the organisation intends to
expand the business in India. Therefore, some strategic tools are taken in order to establish better
business opportunity for UBER. In this regard, the PESTLE analysis, Porter’s Five Force model
is discussed in order to highlight the existing external environment. The OLL factors are also
illuminates to understand the significance of Indian market for UBER. Further, a strategic
comparison is also illustrated into the discussion so that both the internal and external situation
can be evaluated. Finally, the report tries to suggest some measures that can bring future
advantage for UBER in India.

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Table of Contents
Introduction......................................................................................................................................4
Discussion........................................................................................................................................4
PESTLE analysis.........................................................................................................................4
Political....................................................................................................................................4
Economic.................................................................................................................................5
Social.......................................................................................................................................6
Technological..........................................................................................................................6
Legal........................................................................................................................................7
Environmental..........................................................................................................................7
Determinants of OLL factors.......................................................................................................8
Porter’s five force........................................................................................................................9
Threat of entry.........................................................................................................................9
Bargaining power of the buyers...............................................................................................9
Bargaining power of the suppliers.........................................................................................10
Threat of substitutes...............................................................................................................11
Rivalry among the competitors..............................................................................................11
SWOT analysis..........................................................................................................................12
Strength..................................................................................................................................12
Weakness...............................................................................................................................12

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Opportunities.........................................................................................................................13
Threats...................................................................................................................................14
Evolving business strategy........................................................................................................14
Global factory............................................................................................................................14
Recommendations......................................................................................................................15
Conclusion.....................................................................................................................................15
Reference.......................................................................................................................................17
Appendices....................................................................................................................................22
Appendix 1.............................................................................................................................22
Appendix 2.............................................................................................................................23
Appendix 3.............................................................................................................................24
Appendix 4.............................................................................................................................25
Appendix 5.............................................................................................................................26

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Introduction
UBER is popular for its transportation network that includes a great number of ride
services, food delivery and bicycle sharing system. As per the research of Surie and Koduganti
(2016) this transportation network giant has access to 785 metropolitan cities across the world
that provides more than US$ 11.3 billion in 2018. The research of Elliott (2015) advocated that
UBER is estimated to have more than 100 million users with a 69% of market share. Therefore,
this organisation has great influence in the international market. Based on this understanding,
this report aims to analyse the market entry for UBER in India. Henceforth, the PESTLE analysis
is going to use in order to understand the existing business situation in India. Moreover, the
report also puts emphasis on the Porter’s Five Force tool for an in-depth market analysis. The
OLL factors are also incorporated into the assessment so that it will put some light on the
importance of Indian market for UBER. Later on, a SWOT analysis will be carried out with
recommendations that will foster better perception related to the business initiative of UBER in
India.
Discussion
PESTLE analysis
Political
As far as the political situation in India is concerned, it can be stated that India enjoys a
federal republic state based on Parliamentary democracy. There are some threats to the business
organisations across the world in order to do business in India. For instance, corruption is
considered to be the most significant threat for the multinational business organisations. The

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political stability index in India was average -1.14 points with a minimum -1.51 points in 2003
and a maximum of -0.83 points in 2017 (theglobaleconomy.com., 2019). Moreover, the World
Bank data shows that the regulatory quality index is marked -0.37 points averagely with a
maximum -0.16 point in 2000 (heritage.org, 2019). As a matter of fact, the government
effectiveness in India is quiet healthy with an average -0.05 points in an average. Therefore, it
can be argued that despite of volatile political situation in India the government effectiveness is
quite satisfactory that attracts the multinational companies to set their business in India.
Furthermore, it can also be asserted that the standard growth in the efficacy of regulatory
framework also enhances the market opportunities for the Indian market and the foreign
companies can easily relied on the democratic establishment of the country that can facilitate
great deal of help for their business expansion.
Economic
From the economic point of view, India is identified as one of the lucrative markets
around the world. First of all the second largest population makes India one of the major driving
force for foreign companies to visit and invest in a bulk. Nonetheless, there are specific
economic factors that plays pivotal role in order to make India a business-friendly market
internationally and domestically. As per the report of IMF, Indian economic booming witnesses
an increasing development with a rate of 7.3% in 2018 (heritage.org, 2019). One of the biggest
reason behind such economic boom is the industrial activity and foreign direct investment that
make the Indian market more open and optimistic for the foreign investors. It is expected that the
Indian GDP can touch the percentage of 7.7 within the annual period of 2020
(theglobaleconomy.com, 2019). In addition to this, the inflation rate in India is projected to 4.6
within 2020 which is recently marked at 4.7. The economic freedom in the Indian market is

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moderate where most of the other developing countries are suffering with the flexible market.
The business environment ranking identifies a score of 6.08 with a world ranking of 57 out of 82
countries which is not so bad for a developing country for doing business.
Social
The social equation in India is diverse and primarily dominated by the religious
underpinnings. In this context, it can be stated that diversity is the most identifiable aspect in the
Indian society with more than 10 religions are prevalent within the country. In this context, it can
be stated that the Indian society is well known for their friendly attitude and amicable relation
with other religions and culture. Most of the prominent religions in the world are intensely
practiced in India that create a friendly environment to make effective business orientation in
India. In this regard, it can be stated that there are some fractured event of riots and separatism
inside the country. Moreover, it will be a problem to maintain the products of new organisation
based on the cultural differences of India. Despite of the fact, Cooke, Saini and Wang (2014)
opined that the Indian society is highly adaptive in nature and it is effectively committed to
assimilate with different culture in a spontaneous manner. Theft rate in India is quite low with an
average of 24 thefts per 100,000 people. It will be quite satisfactory for UBER as theft in
transportation services is a grave risk factor.
Technological
The growing need of technology in India facilitates a better environment for the business
organisations to use advanced technology in Indian market. For an example, cloud based
transactions, artificial intelligence, big data analysis and the use of augmented and virtual reality
are the key factors that lead India’s growth in technology to the next level (Berger and Herstein,
2014). As a matter of fact, technological advancement can be seen in every sphere of the

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business sectors existed in India. With the help of the global technology based organisations,
India becomes one of the major hubs of advanced technology user nowadays. As per the current
statistics, it can be stated that the number of mobile phone users is growing such a high pace that
will reach the number of users to 813.2 million within 2019 (Calo and Rosenblat, 2017). It
proves that the Indians are well enough to connect with the trending technologies and they have
high expectation to get new technologies as well. Moreover, it is also important to understand
that the Indian market has highest exposure around the world and the demand of advanced
technology will deliver strategic advantage for the business organisations to implement effective
measures.
Legal
The regulatory framework for business is highly detailed in India and the government
initiatives are highly associated with making better and effective measures in order to create
transparent business environment in India. As a result of that the business organisations can feel
relaxed and safe enough to do business in India. However, less government interference in the
business environmentis also encompassed a great deal of impact on the private business
organisations and encouraged them to take decisions freely. As per the report of Guttikunda and
Mohan (2014) business freedom in India is rated at 57.1% with a moderate approach. Moreover,
labour freedom is quite restricted and the monetary freedom is also witnessed a descending
curve.
Environmental
Environment freedom is identified as one of the major factor that boosts the image of
Indian business market effectively. In this context, Ojha et al. (2016) advocated that there are
huge change in the mind of the Indians regarding environmental protection. People are more

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concerned about the environment and the rapid government initiatives in association with the
local, national and global organisations would facilitate the practice further. In response to this,
Aithal (2015) articulated that it will be a strategic advantage for the business organisations to
foster effectiveness into the practice of making sustainable business scenario.
Determinants of OLL factors
For doing business in India there are some Ownership advantages, location advantages
and internalisation advantages that facilitates a global multinational company to visit and doing
business in India. As far as the ownership advantage is concerned, the Indian government takes
necessary actions for safeguarding the rights of the business owners. Henceforth, the Banking
Laws Amendment Law was enacted in 2012 that facilitates the business owners especially the
foreign companies to protect their rights in the high competitive market and business rivalry. It is
the constructive action of the Indian government that encourages the multi-national companies to
invest in India. Besides this, the strategic location of India provides further assistance to the
global business giants to invest in the country and get location advantages. For an instance,
India is the biggest and most promising countries across the South East Asia region with a geo-
strategic location that connects the rests of South-East Asia with India. Furthermore, this
homogenous market witnesses a steady growth in the infrastructure development program. The
government takes huge responsibilities to connect every corner of the country through quality
roads. Therefore, it is highly lucrative for UBER to settle down business in India.

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Porter’s five force
Threat of entry
In an apparent scenario it can be stated that entry in the Indian market is quite flexible for
UBER as there are limited companies that are entitled to make business like UBER. Moreover,
the technological advancement turns out to be an effective matter for UBER to offer exclusive
service. However, the present establishment of UBER can state that UBER is primarily focused
on the demand generation. Therefore, it is obvious that the initial service cost will be high.
Moreover, the automobile industry is highly flourished in India where giant automobile
manufacturers like Volkswagen, Suzuki, Honda, Ford are dominated the Indian market (Singh,
2016). Therefore, it must be benefitial for UBER to enter into the Indian market extensively.
However, a potential threat can be occurred from the local transportation market. The local
market is powerful because political influence on the local transportation unions is a basic
feature for Indian transportation market. Furthermore, another prominent threat can be found in
terms of getting efficient drivers and skilled employees. These two factors are highly and
dominantly influence the Indian market and gradually becomes a culture. Therefore, in its
inceptive face it can be a grave problem for UBER to get accustomed with the existing working
culture in India.
Bargaining power of the buyers
As far as the bargaining power of the customer is concerned, UBER gets a reasonably
high range power range of customers and having strong competition. In course of doing business
in India, it is important for UBER to make a better price position because the demand side is
highly low due to high price tags. Moreover, the value proposition for the customers strikes at a
low transactions and search costs with a shorter waiting time. It can be an effective facet for

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UBER to attract more customers while expanding market in India. Moreover, the Indian buyers
are already knew the transportation services (Panda, Verma & Mehta, 2015). Therefore, it is not
new for them to get unique UBER service. Moreover, it can be argued that the Indian buyers are
more dedicated to deal with less pricy services with an expectation of getting good quality
service. As a result of that it becomes a major challenge for UBER to settle down with the
specific behaviour and demand of the Indian customers (Leighton, 2016). Moreover, it can be
argued that the existing transportation services companies are already provide similar services to
the Indian customers as UBER does in other existing market. Therefore, having no unique
feature can jeopardize the entire process of maximising the customers.
Bargaining power of the suppliers
The existing transportation market in India is highly controlled by the unions. In other
words, the unions plays the deciding role in the Indian transportation system. As a result of that
the transportation market is highly coloured by politics. In this context, influencing the suppliers
is quite problematic for UBER while expanding market in India (Edelman & Geradin, 2015).
Proper shift timings for the drivers and no monthly wages is the basic characteristics of the
Indian market. Moreover, unionisation is also considered to be an important aspect for the
drivers to get exploited. Therefore, it can be argued that the power of the suppliers is quite low in
India. As a matter of fact, different strategies to lure the drivers UBER generally use reservation
wages and hourly wage system to maximise the suppliers in terms of the drivers (Dudley,
Banister & Schwanen, 2017). There are enough skilled drivers in India and it must not be a
problem for UBER to recruit drivers effectively. In fact, the competition is seen within the
supply side and the lower switching costs make it easier for the drivers to join effectively in
UBER.

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Threat of substitutes
Substitutes are considered to be played a major role while doing business in India. The
magnanimity of the market with a huge number of other alternatives can jeopardise the business
establishment of UBER. In this regard, most of the Indian people are fond of low rate of
transportation costs therefore it will be a problem for UBER to adjust its cost price as per the
Indian market. Moreover, the problem will be extended further where it can be found out that
substitution in Indian market is demarked as the best possible feature to encourage the business
organisations introducing more exclusive products and services in the context of offering unique
materials (Crespo, 2016). Therefore, the problem can be identified in terms of establishing a
better marketing mechanism for UBER in order to expand the business efficiently.
Rivalry among the competitors
All those previous factors can easily identify the existing rivalry among different business
organisation in Indian market and mark out different approaches so that it will resolve the
problems effectively. The competition in the transportation sector in India is quite low for UBER
is compare to other countries because there are limited organisations that are responsible to
create pressure on the massive market capitalisation by UBER in Indian market (Das & Ara,
2015). However, the local transportation authorities can cause huge impact on UBER because of
empowering by political parties. Moreover, those local transportation services have more
experience and idea about the local market that can be a barrier for UBER in order to capitalising
Indian market. In addition to this, the service cost is relatively high that UBER charges in
compare to the different transportation services. Therefore, it will hamper the business
establishment for UBER in India. Nevertheless, it can be argued that creativity and introduction
of unique service facility can usher a new experience to the Indian people with more time

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effective measure which is identified as one of the best policy for UBER to sustain in the Indian
market (DeBruyne, 2017).
SWOT analysis
Strength
 The global exposure of UBER and its international presence make UBER one of the
significant transportation service organisation across the world. In fact, UBER has
already crossed the automobile giants like Ford, Honda and General Motors.
 The low fixed investment strategy is quite effective for UBER to do business globally. As
a result of that the company is able to add more cities into its network (Tiwari, Jain &
Rao, 2016). It is also associated with the expansionist strategy and ready to provide
enough exposure to the profitability of UBER.
 Prioritising Customer satisfaction is another strategy for UBER as the organisation
belongs to the service industry. Moreover, it can be stated that the organisation
understands the importance of its customers and always stay concerned about
maximisation of customers.
Weakness
 Having enough dependency on manpower is a serious weakness for UBER in the
technologically advanced world. First of all the behaviours of the drivers is always a
concerned problem for UBER to check on. High chances of uncontrollable situation can
damage the image of UBER. Moreover, in the technology driven world it is essential for
the organisation to put more focus on introducing advance technology (Nallusamy,
Balakannan, Chakraborty & Majumdar, 2015).

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 Moreover, UBER is highly dependent on the internet connectivity and this procedure is
also followed in other countries. Using internet and Google tracking device is considered
to be highly sophisticated for the users in developing countries. Therefore, the tech savvy
people can handle such an interface that can be an obstacle for countries where digital
literacy is too low.
 There are huge controversies leading to the business orientation of UBER in several
countries. As a matter of fact, UBER drivers were also accused with molestation charges.
This affects the image of the company highly and diversifies the mind of the potential
customers dominantly.
Opportunities
 It can be stated that the unorganised cab market is really an advantage for UBER to get
entry into the Indian market. As the taxi and bus unions are very strong and corrupted
therefore no such measure for the customer satisfaction is generated in this aspect.
However, companies like UBER started this kind of business strategy and it can be a
strategic advantage to do business in India.
 The government programs like Digital India’ make India a tech savvy country and most
of the Indians are now have fundamental knowledge of internet access. Therefore, it will
be no problem for UBER to establish its market in India (Jarboui, Forget & Boujelben,,
2015).
 Besides this, alternate transportation services like bicycle rides and bike rides are also
available in UBER. For countries like India it will be a great advantage for UBER to
penetrate into the market effectively.

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Threats
 However, the government regulations are serious concern for UBER while doing
business in India. The stern government intervention and the role of trade union can
affect the liberty of decision making for an organisation.
 Low profit margin for the drivers can be a challenge to get efficient and skilled drivers.
Apparently, it seems that the drivers can get high number of rides but the shared profit of
rides is less for the drivers as most of the profit margin is accounted for UBER (Tiwari,,
Jain & Rao, 2016).
 Unauthorised market is a grave challenge for UBER before establishing business in India.
The more the transport union is strong the more it will be fatal for UBER to survive in the
Indian market. Therefore, a sense of political threat is always there in the Indian market.
Evolving business strategy
In this regard, UBER started to create effective business strategy in terms of the
transnational strategy. Based on this strategy, the company puts emphasis on both the domestic
elements as well as the international behaviour where dynamic customers can be the target
customers of UBER. As a matter of fact, the transnational strategy helps UBER to enhance the
acceptability in both Indian and international market.
Global factory
As far as the global factory of UBER is concerned, the organisation puts emphasis on the
both the domestic needs and imbibes the changes in the global market so that it will deliver
strategic advantage for the organisation. However, there is challenge that UBER is facing in
India in terms of shortage of infrastructure in the Indian market in compare to USA. However,

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technological innovation and unique business strategies are the key components of effective
business establishment of UBER in India.
Recommendations
 At first, it is essential for UBER to set a bar for the enrolment of the UBER drivers. In
this regard, a skill checking and behavioural evaluation is highly required in order to
appoint efficient drivers in India.
 Hike in the profit margin for the UBER drivers is also an important aspect that can get a
number of interested drivers to enlist their names in UBER. With the help of the high
profit margin strategy UBER can resolve the problems regarding trade union pressure in
the Indian market and also help the government by providing a future scope of
employment.
 Using both online and offline service will be considered as another effective strategy for
UBER in order to maximise the customer base by incorporating the technologically
disabled people. The prime or star drivers should get this facility and get some scope to
earn a lot. It will also encourage other drivers to provide good service.
 Reducing the cost is also an important aspect for UBER to maximise customers and
reduce the threat of alternatives. Providing rental or coupons will help for the promotions
and UBER can develop its market in India effectively.
Conclusion
From the above point of view, it can be stated that both the external and internal
environment are discussed that will influence the business operations of UBER in India. As per
the external environment the PESTLE analysis is implemented thoroughly. Moreover, the

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Porter’s Five Forces analytical tool is also used in order to get a clear market assessment and
exposure in India. Besides this, the SWOT analysis is also introduced for comparing the internal
and external factors. The recommendation part suggests UBER to take some initiatives for
getting a strategic advantage effectively. Therefore, it can be concluded that the report rightly
discusses the opportunity and scope for UBER to maximise profitability through effective
marketing strategy.

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Appendices
Appendix 1
Figure 1: Government effectiveness in India
(theglobaleconomy.com. (2019)

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Appendix 2
Figure 2: Political stability in India
(theglobaleconomy.com. 2019).

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Appendix 3
Figure 3: regulatory quality for business in India
(theglobaleconomy.com. 2019).

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Appendix 4
Figure 4: theft rate in Inda
(theglobaleconomy.com. 2019).

26GLOBAL BUSINESS PERSPECTIVE
Appendix 5
Figure 5: Mobile users in India
(theglobaleconomy.com. 2019))