Strategic Management in Emerging Markets

This assignment examines strategic management concepts within the context of emerging markets, drawing upon case studies from countries such as Brazil, India, and China. Students will explore how traditional strategic frameworks are adapted to navigate the unique challenges and opportunities presented by these rapidly developing economies. The analysis will encompass factors like political instability, regulatory landscapes, consumer behavior shifts, technological advancements, and competitive dynamics. Furthermore, students will evaluate the impact of global trends, such as increasing demand for sustainable business practices and growing geopolitical complexities, on strategic decision-making in emerging markets.

Running Head: Global Business
Cheers beers
Global Business

Global Business 1
Executive Summary
Cheers beer is a start-up organization dealing in craft beer in Australia. Cheers beers are owned
to the five business graduates of Australia. Their main concern for setting up the business was to
become an entrepreneur and develop their separate entity in the market. They achieved more
than expected success and growth in the initial period of business start-up. The major reason for
achieving success for business was the unique idea of serving Australian people with craft beer.
This type of beer is much demanded in the Australian local public as well as in the international
tourists. Initially, each partner invested $, 100,000 and with the total of $500,000 the first beer
was served in 2010. By the end of the financial year 2015-2016, Craft beer reached to the mark
of $30 million growth. After achieving to this standard of growth, partners of Cheers beer
decided to move towards the international market in terms of the business expansion as more
than the achieved growth in the Australia was not possible. For the same, marketing team of the
Cheers beer researched the global business environment and Brazil and India was selected
amongst the world in terms of expansion of the business. To set up the business in these
countries, appropriate strategies and methods were adopted in order to gain the knowledge in
relevance to the market conditions, macro as well as micro environmental factors, etc.

Global Business 2
Table of Contents
Introduction......................................................................................................................................3
Analysis of Risks and Opportunities...............................................................................................4
Selected Country..............................................................................................................................9
Propose market entry in India........................................................................................................10
Conclusion.....................................................................................................................................12
References......................................................................................................................................13

Global Business 3
Introduction
In order to attain the growth in the career, a group of five students who were friends as well.
They all were graduated in Business from Southern Cross University. After getting bachelor's
degree, they could have been moved towards getting the adequate job but they adopted the
unique way to achieve growth in their life. The business was start-up at the most favorable
location in Australia which is also known as the center of attraction for Australia i.e. Gold Coast.
With the effect of growth achieved in the Australia, partners of Cheers beer have decided to
move towards the India and the Brazil for business expansion purpose. In order to attain
adequate sort of growth rate achieved, all the factors in relation to the entering into the new
market will be covered by this report. Risks and the opportunities available in the Indian and
Brazilian brewery market will be discussed with the view to ascertain the objectives of the
organization. Along with the attainment of the growth objectives for the organization, Cheers
beer has adopted the certain set of strategies in order to achieve adequate success in the new
markets. Along with the risks and the opportunities, all other relevant factors which could affect
the business performance and could help in achieving the targets set up by the management of
the organization will also be discussed. The idea of craft beer is a unique one and it could result
in the advantage for the Cheers beer in the new locations in achieving goals for the organization
and setting up their distinctive place in the market too.

Global Business 4
Analysis of Risks and Opportunities
Risk factors are present in every business environment and these are the major sources for the
attainment of adequate growth as well as this is the major reason for declining the business
performance. Due to risks factors, organizations develop strategies in order to reduce the effect
of those factors as well as the adaptation of advanced and unique methods to perform the
business activities is also due to risks factors present in the business environment. Under this
report, analysis of risk factors will be performed in order to ascertain the risks factors present in
the Indian and Brazilian business environment (Bharwani & Mathews, 2012).
Indian market is full of risks as well as opportunities factors. As Indian economy is rising at the
huge growth rate and with the effect of this, international companies have the chance of setting
up their business in the Indian market in order to establish their adequate position. Apart from
the rising economy, the government of India has invited international companies to invest in
their organization in order to increase the foreign investment. This will also lead to increase in
the employment opportunities in India as well as the GDP of the country will also be increased
with the entry of foreign companies. Apart from these opportunities available in the Indian
market, lot of risks factors are also involved such as India is a Hinduism country and due to this,
large number of Indian public does not consume alcoholic products on occasions and due to
numerous numbers of religions in the country, occasions and the festival season in India never
ends. Apart from this, various states of India are banned in terms of selling, serving and
consuming alcoholic products. Bihar and Gujarat are the examples of states of India where
consumption and selling of alcoholic products are banned. Indian culture is designed in such a
way where traditionally no one can consume alcoholic products but with the effect of time,

Global Business 5
consumption of alcoholic drinks has risen at the huge rate in recent years. Consumption of beer
in India is not much in comparison to the consumption of whiskey and other alcoholic drinks. In
the 18th century, Indians used to consume beer made of rice and millet but later on, it gets
replaced with European drinks. In terms of consumption of beer, India stands at the second stage
because consumption of alcohol has risen at the huge rate over there. As per the survey report,
consumption of alcoholic drinks has increased in India and it has reached the mark of 57 liters
per capita consumption and the rate of consumption of alcoholic drinks is rising at 7.5%. Apart
from these factors, advertisement and the promotion of alcoholic and tobacco products is banned
in India whereas it is allowed in Brazil. Hence, setting up the goodwill in the consumers' mind in
the Indian market will be bit difficult task for Cheers beer as the only way to promote its
products will be through the bars, restaurants who serve alcohol as well as the wine shops
(Binod, et. al., 2013).

Global Business 6
(Source: Jourbal.beer, 2017).
In terms of beer consumption, Brazil stands at the 3rd rank whereas India is in the 20th position
and these are the figures of 2012-2013. These figures have been continuously rising with the
increase in the population of these countries (Bourke, et. al., 2012).

Global Business 7
Consumption of beer in Brazilian market has been increased with 5% in 2014 while comparing
the figures with 2013. The hike in the average consumption of beer in Brazil has increased with
the effect of various reasons such as positive climate, the World Cup, and the Carnival. Due to
these factors, various tourists have visited Brazil and therefore the consumption of beer has
increased since the last 10 years (Wheelen & Hunger, 2011).
Brazilian brewery market is also filled with various risks and opportunities factors. There is no
limitation imposed on any part of the Brazil in terms of consumption of alcoholic products. The
biggest risk involved in the Brazilian market is the 98% market share is covered by the one beer
brand only i.e. Standard Lager beer. Brazil is the third largest beer consumption country across
the globe. Consumption of beer on the basis of per capita is 61 liters in 2016. Reviewing these
points, Cheers beers have the bigger opportunity in comparison to the India for expanding their
business. Brazilian tax system may create some disturbance while entering into the Brazilian
market. New organizations need to adopt various techniques for taking the permission for
entering into Brazil for trading activities. While comparing the Indian brewery market with
Brazilian market through considering all the relevant factors, it is observed that Cheers beer may
evaluate certain advanced factors through which clearly understanding in relevance to the
selection of the adequate country could be done (D'Aversa, 2016).

Global Business 8
(Souce: Unnikrishnan, 2013)

Global Business 9
Below are some of the advanced relevant factors in terms of Indian as well as Brazilian brewery
market:
 Promotion: Cheers beer will be able to promote its beer through any medium in Brazil
market whereas; this function will not be able to perform in the Indian market. Indian
culture does not promote the consumption of alcohol products hence; consumption of
alcohol is banned in some states. Apart from the Indian market, Brazilian market does not
have regulation in terms of promotion of alcoholic drinks or in relevance to the
consumption of alcohol (David, 2011).
 Legal aspects: In terms of legal considerations, Cheers beer may need to take determine
various aspects while taking entry into Brazil whereas; while entering into the Indian
market, the relevant formalities will be required (Successive, et. al., 2014).
 Growth rate: Indian market is growing at the high rate as Indian economy stands on the
second position in terms of rising economy whereas; Brazilian market is also in the same
stage of rising economy but it is far away from Indian economy (Somdaka, 2014).
 Market Entry: While entering into the Indian brewery market, an organization may opt
for the joint venture, direct exporting, partnership firm, etc. Apart from these factors,
Cheers Beer needs to evaluate and fulfill the particular country's legal considerations in
order to meet the goals of the organization. But in the scenario of Brazilian brewery
market, Cheers beer needs to take permission from various departments. Before this, once
an organization tried to enter into Brazilian brewery market, Standard Lager organization
which has the huge market share in Brazil shows them the aggressive competitive
strategies and due to this, no organization is being able to develop its separate entity
against the Standard Lager beer. Hence, reviewing this case, Cheers beer needs to

Global Business 10
evaluate all the factors while entering into the Brazilian brewery market (Enderwick,
2012).
 Trade Relations: Cheers beer belongs to the Australia and they are planning to move
towards the Indian and Brazilian market through reviewing the opportunities and the
challenges available in those particular markets. Both are rising economies and moving
the developed countries at the fast rate, hence; achieving the adequate position in both
these countries will generate favorable results for the organization in terms of growth and
the expansion (Flynn, 2011).
Australian and Indian trading relations are from the times of Commonwealth of Australia
and Republic of India. They both were the part of British Empire hence; trading activities
between those countries are conducting since that period. After British rule, both these
countries are connected through various other mediums such as sports activities and
cricket is one of the biggest factors in maintaining good relations between Australia and
India. Hence, Cheers beer will be able to enter into Indian brewery market very easily
(Sheth, 2011).
Trade relations between Brazil and Australia are also very effective as they both have
their embassies in each other’s country. A large number of exports and import activities
are conducted between these two countries. Australia and Brazil have various joint
ventures in the investment field, agriculture, mining, energy, science, etc. Hence,
Australia has good trading relations with both selected countries i.e. India and Brazil
(Haimes, 2015).

Global Business 11
Selected Country
In terms of the expansion of the Cheers beer organization in a global market, a various analysis
in relevance to the risks and the opportunities have been conducted in the selected two countries
i.e. India and in Brazil. Reviewing all the factors relevant to the expansion of the beer business
for achieving adequate growth, Indian brewery market was selected (Seidenstricker, Linder &
Schmitz, 2014). This decision is taken on various aspects such as investment invitation by the
government of the India, simple rules and regulations in terms of entering the market, better
chances available as craft beer will be the new and unique product for India, etc. Apart from the
above factors discussed, labor rates and the land rates will also affect the success of the business
and while performing the trading activities in India, these factors will consume fewer factors in
terms of any other country. Due to the huge population, unemployment is the biggest issue for
the country and this is the reason for low labor cost. Combination of all these factors helps the
Cheers beer to set up its distinctive image in the competitive business environment and along
with this, the development of the goodwill is in the organization’s hands only because this will
be based on various purposes such as quality of the product, price of the product, etc. (Holden,
2011).

Global Business 12
Propose market entry in India
Proposed entry strategy consists of various aspects such as selection of the available options of
market entry strategies (Kim & Mauborgne, 2014). Along with the section, numerous numbers of
legal and political considerations need to be fulfilled while submitting the papers to the
government of India for taking the permit to enter the market for selling alcoholic drinks. In the
scenario of normal products' trading, the formalities are not much as compared to the policies
included in the proposal entry plan for the trading of alcoholic drinks. Cheers beer needs to
create a budget and the financial statements need to be submitted to the authorized body i.e. to
the RBI (Reserve Bank of India in terms of acquiring the permit from the organization. There are
a number of entry modes available in terms of international businesses which are as follows:
 Direct Exporting: Under this method, an organization could sell its products and
services to another country through any agent available in the host country and through
fulfilling certain legal as well as trading requirements. This mode of entry is not possible
for Cheers beer as this will not help the organization to attain the goals set up by the
management (Laïdi, 2014).
 Licensing: This method requires adequate documentation part. Cheers beers need to
submit its all relevant documents to the authority of the country in order to gain the
permission to perform the business activities. Cheers beer needs to follow and adopt this
type of market entry option.
 Joint venture or Partnership: Cheers beer could also choose this market entry option in
Indian brewery market. Under this method, Cheers beer needs to find one local brand of
beer in India and by entering into the partnership or in joint venture type of business,

Global Business 13
they could enter the Indian market. This will help them to reduce the risks factors
involved in the Indian market as well as the investment and the profit sharing will also be
shared amongst the partners or the members of the joint venture (Lane & Shambaugh,
2010).
Amongst the above entry modes, Cheers beer could adopt the Licensing mode of entry
into the Indian brewery market. This will help them to fulfill requirements of the
organization as well as it will help the organization to develop its separate image in the
competitive business environment of India with the unique product and unique idea
(Saad‐Filho, 2015).

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Conclusion
This report reflects the assessment of risks and the opportunities factors available in the brewery
industry of India and the Brazil. Cheers beer is seeking for expansion in these two countries and
for this purpose; this assessment was conducted in order to establish the adequate platform to
enter into the suitable market amongst the India and the Brazil. The expansion of the firm was
done to achieve higher growth and the objectives for the organization. Various techniques were
used to evaluate the risks and the opportunities factors available in the brewery market of India
and the Brazil. After reviewing all the factors, organizational management decided to move
towards the Indian brewery market in order to achieve the expected growth rate through selling
their craft beer in the Indian market. For entry purpose into the Indian market, the organization
selected Licensing policy.

Global Business 15
References
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brewing in Australia”.

Global Business 16
Kim, W.C. & Mauborgne, R.A., 2014, “Harvard business review Press”, Blue ocean strategy,
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