Global Expansion Strategies for Jiffy: India vs China

This report discusses the benefits and challenges of global expansion for Jiffy, an online supermarket company in the UK, and explores the opportunities for expansion in India and China. It includes a PESTEL analysis of both countries, competitive forces, Porter's generic strategies, and entry mode and market selection. The report concludes that India is the most appropriate country for expansion and recommends a joint venture strategy and cost leadership strategy for Jiffy.

Business and
globalisation

Executive Summary
Global expansion is beneficial for any organization because it provides opportunity to
gain higher profitability. Jiffy is online supermarket company in UK offering fast delivery
services to consumers. China and India are two possible markets for international expansion
because of economic opportunities present in these countries. In context of present company,
various strategies such as franchising and licensing can be adopted to expand into China or India.
From analysis of political, competitive environment and internationalization divers India and
China it is analysed that the most appropriate country for expansion for Jiffy is India. Joint
venture strategy can be used by the firm for entering the market and the firm can also use cost
leadership strategy to maintain strong competitive positioning in India.

Contents
Executive Summary.........................................................................................................................1
Contents...........................................................................................................................................2
1 INTRODUCTION........................................................................................................................4
2 Jiffy Overview..............................................................................................................................4
3 The Global E-commerce Supermarket Industry...........................................................................5
4 The Importance of Global Trading...............................................................................................6
4.1 International Drivers..............................................................................................................8
5 Expansion Opportunities in India and China................................................................................9
5.1 India Overview......................................................................................................................9
5.2 China Overview...................................................................................................................10
6 External Environment PESTEL..................................................................................................10
6.1 PESTEL Analysis of India and China.................................................................................10
6.2 Entry into India or China.....................................................................................................13
7 Competitive Forces.....................................................................................................................13
8 Porter’s Generic Strategies and Ansoff Matrix..........................................................................14
9 Entry Mode and Market Selection..............................................................................................16
CONCLUSION..............................................................................................................................18
REFERENCES..............................................................................................................................19
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3

1 INTRODUCTION
Globalisation is process of growing independence among the world's economies and
culture due to cross border trade of goods and services. Globalization enables the local
organisation to buy and sell and their products and services apart from their national borders. It is
the most important and valuable methods which helps to start international trade. There are large
number of benefits are present for international trade which not only enjoyed by businesses but
also enjoyed by nation and their economy. It helps to improve cross border relationship with the
help of common benefits of international business.
Jiffy is an online E-commerce organisation which is taken here for global expansion and the
countries which are selected are India and China. The report helps to understand the impact and
importance of global trade. In addition to this overview of the selected company in context of
globalization is provided in this report. After this, report includes application of different
strategies which can be used to enter the specified market. The last section of report includes
findings and suggestion to selected organisation in regards to entering a new market. The market
which is selected for global expansion of Jiffy is India.
2 Jiffy Overview
Figure 1: Jiffy Logo from Website
(Source: Jiffy Grocery, 2022)
The organisation which is taken here conduct this report is Jiffy which is a London based
organisation and conduct their business locally. It is an Online supermarket which provides
facility of providing fast delivery of their products to the customers. The customers of the
company can order the present essentials and grocery from the application of organisation and
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get the ultra-fast delivery of their products. The company was founded in the year 2020 by
Vladimir Kholiaznikov and Artus Shamalov with an aim to provide quality services to the
customers. The management of company raises £23.2m since their establishment which is one of
their achievement. The concept of business is very unique and effective which becomes the
reason for attraction of investors towards the organisation (Trindade d’Ávila Magalhães, 2018).
3 The Global E-commerce Supermarket Industry
Figure 2: Global Online Grocery market
(Source: Online Grocery Market Size, Share & Trends Analysis Report By Product Type (Fresh
Produce, Breakfast & Dairy, Snacks & Beverages, Staples & Cooking Essentials), By Region,
And Segment Forecasts, 2022 - 2030)
From the above graph it is determined that the global Online grocery market is highly
valued and divided into different segments such as fresh produce, breakfast and dairy. Jiffy
offers consumers faster method of purchasing different grocery products without compromising
on quality of the products. This means that the respective company can earn high profits by
expanding to international market as it has extensive collection of grocery products deliver right
to he doorstep of the consumer.
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Figure 3: Global Online Grocery Market Size
(Source: Online Grocery Market Share, Size, Trends, Industry Analysis Report, By Product Type
(Fresh Produce, Breakfast & Dairy, Snacks & Beverages, Meat & Seafood, Staples & Cooking
Essentials, Others); By Region; Segment Forecast, 2022 - 2030)
From the above graph it is interpreted that consumers across America, Asia and even in
the middle east are growing to accept online grocery purchase. In addition to this, Online grocery
purchase is also rising across different continents. This is the right time for Jiffy to expand to
international markets and gain the benefit of rise in online grocery purchase.
4 The Importance of Global Trading
The concept of globalisation and international trade is one of most important and
revolutionary concept of the market which helps to maintain peace and effective relations
between different types of countries. There are many businesses are present in market which
reflects great heights and growth in market due to their international expansion in market. The
concept of international trade enables organisation to analyse different types of market of world
so that it becomes easy for them to provide effective returns in the market. It is required for an
organisation to have knowledge of benefits so that concept can be used in organisation in
effective manner. It is also for organisation to analyse the impacts of globalisation on business so
that selection of effective strategies can be made (Ryazanova-Clarke, 2022).
Impacts of global trade to business
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Global trade is a valuable concept for the business under which all goods and services of
organisation are sell in international market which provides them different types of opportunities.
There are large number of factors are present which is required to be analyse so that it becomes
possible to analyse all the impacts. The brief discussion related to these impacts are given below;
 The impact of international trade is positive on management of business as it helps
business to achieve different types of opportunities in market.
 International trade opens opportunities for cost reduction and organizational development
as businesses gain accesses to cheaper labour and resources for reducing cost of the
company (Sutcliffe and Glyn, 2019).
Benefits and challenges
There are number of benefits and challenges are present which is provided by concept of
international trade which enables the organisation to operate their business internationally. These
benefits motivate different types of organisation to set up their business in international markets.
The brief discussion related to the benefits of international trade on business are given below:
 There are large number of customers are present in international market due to
involvement of multiple nations. It provides huge base of customers to company which
helps to improve their revenues (Tolkach and Pratt, 2019).
 It is very helpful for the organisation to achieve their goals of growth and expansion if
their business is established in international markets because of larger number of
opportunities in comparison to local markets.
 The business relations of the organisation become improve due to international trade
because many companies are present in market.
 The financial position of the organisation is positively impacted due to international
trade. The number of investors are very high in international market in comparison to
local market which increases the investment in company (Thorpe and Figge, 2018).
There are also number of challenges are present in market which the organisation has to
face while operating their business in international market and the brief discussion related to the
same are given below:
 One of the biggest challenge which the organisation faced while conducting their
business in international market is level of competition. There are large number of
business giants are present in market which provide stiff competition. It is important for
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company to have strong financial position and effective strategic management to deal
with the competition (Tridico and Paternesi Meloni, 2018).
 The another challenge which can be faced by organisation is excess rules and regulations
in market. There are large number of rules and regulations need to satisfy by organisation
at time of conducting their business in market and becomes negative for organisation.
4.1 International Drivers
Internationalisation drivers are those factors that expresses a need for expanding firm's
market globally or internationally (Milner, 2019). These drivers cut down the cost of several
operations in business such as manufacturing or selling its products or services. Several
internationalisation drivers are given below:
 Cost drivers: Cost drivers includes the need for reducing or cutting cost of an
organisation such as Jiffy to reduce their expenses and increase their profitability. The
economic growth in China and India is internationalization driver for Jiffy. Market drivers: This includes changes in market which leads to creation of growth
opportunities at the company. China and India have prospering and growing digital
infrastructure as well as huge population ready to use better digital solutions making it
market with many opportunities for the respective firm
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 Competitive Drivers: This refers to the changes in competition resulting in upcoming
growth opportunity in the specific market. Both India and China are growing
economically and there is also presence of e-commerce retailers in the country offering
similar quality products and services. This respective company can gain strong loyal
consumer base in any of these markets by offering better products and services than
competitors. Government Drivers: Indian Government has initiated make in India campaign
supporting arrival of international firms in the country. This makes the e-commerce and
quick delivery services offered by Jiffy compatible with the Indian market.
5 Expansion Opportunities in India and China
5.1 India Overview
India is the second highest populated country in the world with growing economy and
developing infrastructure. It is important for an organisation to consider the language which is
being spoken in country where firm is planning to expand (Cohen, 2018). The solve this issue
managers of Jiffy can recruit local people in their stores at China and India to avoid language
differences as well as smooth flow of work. Each nation has its own legal laws and rules which
can restrict any organisation to expand itself in other countries (Gravina and Lanzafame, 2021).
The laws and regulations in India are different from UK. The managers of Jiffy need permissions
from government and follow legal laws to operate in these countries. To solve the issues of legal
laws managers of Jiffy can get a better understanding of laws that are prevailing in India.
Figure 4: Index of Economic Freedom: India
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(Source: India, 2022)
5.2 China Overview
China’s growth rate is reduced significantly in recent years because of COVID-19. In
addition to this, the country is also facing downturn in terms of economic stability because of
trade war between China and USA. Since China is ruled by a communist dictatorship party, the
entry of new businesses in the country, specifically from western regions is challenging. Factors
such as limitations on Hong Kong’s autonomy, the oppression of China’s Uyghur minority, and
Beijing’s cyberwarfare activities have lead to reduction of global trust in the country and created
difficulties for trading with the country.
Figure 5: Economic Freedom Index: China
(Source: China, 2022)
6 External Environment PESTEL
The markets which is selected to demonstrate this report is India and China which are
both the developing countries but there are some factors are present in these countries which
makes them favourable. These factors of the markets are described with the help of PESTLE
analyses and brief discussion related to the same are given below:
6.1 PESTEL Analysis of India and China
Factors India
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Political The political factors of India are very positive for new and international
business. The government of country has developed number of programmes
related to international investment and holding in country. The authorise of
country has increases the percentage of holding of international investors on
Indian companies. It also eases many restrictions for entry of international
country.
Economical The government of India focuses on production in India under different
schemes. Then organisations which established their manufacturing units in
country provides different types of tax relaxations. The present corporate
rates for international organisations is 15% which is negotiable as per the
different measures.
Social The population aspect of the country is their core strength. The peoples of
country are very possessive and reactive towards their beliefs or traditions.
It is required for organisations to have dynamic approach towards their
tradition.
Technological The technological background of the company plays important role for
success of any organisation in market. The people of India prefer to use
those services in their working which reduces their efforts. It becomes
positive for management of Jiffy to operate their business in same country
because whole structure of the business is depending upon technological
aspect.
Legal This section of the analyses is depending upon the impact of rules and
regulations made by government (Tushnet, 2019). There are different types
of regulations and rules are present which organisation need to satisfy for
conducting their business which becomes hectic for management
sometimes.
Environmental It is important for companies to follow such environmental rules so that it
becomes possible to operate their business without any problem.
PESTEL Analysis of China
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Factors China
Political The government of China has faced different types of losses due to their
trade war with US. Many companies of USA start to shift their businesses
from China to another country which negatively impacts their economy. The
entry of Jiffy becomes beneficial because it gets the support from the
government to compensate their losses.
Economical The tax rates charges by government of China is slightly high than other
countries which is 25%. The sale and the opportunities of market can helps
the organisation to compensate the so. It becomes easy for the organisation
to get cheap labour in country which helps to maintain the profit margins for
the organisations.
Social The People of China followed their tradition and belief strictly which makes
compulsory for the organisation to have effective approach. The traditional
aspect of the country should be reflected from business functions of
company which helps to protects them from number of criticism.
Technological The technological background of China is very strong which becomes
essential for any international organisation to established their business. The
government of China has heavy investment in their research and
development department which promotes technology and innovation. It
becomes easy for management of Jiffy to established their business in this
type of environment.
Legal The government of the country has applied number of regulations for
companies. The authorities have followed effective structure which makes
easy for organisations to follow such rules.
Environmental It is important for management of company to have effective approach
about natural environment because there are many penalties levied by
government.
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6.2 Entry into India or China
Score China India Recommended
Political 4 7 India
Economic 5 6 India
Social 7 8 India
Technical 6 5 Neutral
Legal 8 7 China
Total 26 33
From the above analysis it is determined that the most suitable country for international
expansion is China. For the respective company, the political issues as well as the economic
stagnation in China can lead to failure in future. On the other hand the growing economic
environment of India can support the firm attaining higher profitability and success.
7 Competitive Forces
Elements India China
Threat of new
entrant
There are different types of business giants
are present in market which make very
difficulties for new entrants leading to high
threat of entrants. It is very important for
management of Jiffy to have effective and
competitive marketing aspect which helps
them to overcome from these situations.
The authorities of China
prioritizes local organizations
over international firm. This
increases that of entry in the
region to high level.
Bargaining
power of
supplier
The bargaining power of suppliers are
more when there are only few suppliers and
vice-versa. India is an agricultural country
under which there are large number of
suppliers of essentials leading to low
bargaining power that it becomes positive
The agricultural production of
china is not as much effective so
bargaining power of suppliers
becomes low. This negatively
impacts the prices of raw material
and also on profit margins of
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for management of Jiffy. company.
Competition in
existing market
The threat of competition in Indian market
are very high which negatively impacts the
profit margins. The main reason for
presence of this scenario
The level of competition are
slightly high in market of China
which becomes negative for
organisations.
Bargaining
power of
buyers
The bargaining power of the buyers are
very high as they demand new and advance
product which helps the organisation to
operate their business at merit basis.
The customers of China require
dynamic product range which
enables the organisation to make
continuous improvement in their
organisation. There are various
local competitors leading to high
bargaining power of consumers.
Threats of
substitute
products or
services
Substitute products means when a product
used for same purpose by consumers
against another product. There are many
technology firms and start-ups in India
which support online delivery solutions to
firms such as Swingy genie. This increases
threat of substitute to high level.
SF is the largest express logistics
service and solution provider in
Mainland China. In addition to
this there are other various
delivery solution firms. This leads
to high threat of substitutes for
Jiffy in China.
8 Porter’s Generic Strategies and Ansoff Matrix
Ansoff Matrix
Ansoff matrix is a useful tool for marketers to identify opportunities for generating more
revenue by opting for a new product line or entering into a new market. Several firms like Jiffy
uses this tool for growth expansion by entering into new markets of India and China. Ansoff
matrix in context of Jiffy is given below: Market penetration: Market penetration deals with serving existing customers with the
existing products or services. Companies such as Jiffy deals with its existing customers
through online websites and provide them with a wide variety of goods and services.
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 Market development: Market development checks its concerns with entering into new
markets for expansion. In terms of growing its market, Jiffy has chosen the new markets
of India and China for withdrawing raw materials and manufacturing concerns. Product and development: Product and development includes the advancement,
innovation or development of existing products or services. For this context, Jiffy has
shifted some part of its business to online to reach out more and more customers globally. Diversification: Diversification involves various factors related to getting customer
acquisition into new markets. Online channel of Jiffy delivers a wide variety of products
to meet the requirements of diverse population globally.
From the above discussion the most appropriate strategy for the growth of Jiffy is market
development and expanding into India for further growth.
Porter’s generic strategies
Various companies uses different strategies of approaching several markets to give tough
hand to its competitors (Callaghan, 2021). Companies like Jiffy uses Porter's generic strategies
to satisfy this concern. It may prove to be beneficial for this firm to form alternate strategies and
different approaches to enter into new markets of India and China. Porter's generic strategies in
context to Jiffy is given below: Cost Leadership strategy: Cost leadership strategy deals with cost reduction of the
businesses like Jiffy while they are entering into new markets globally. Differentiation strategy: Differentiating strategy focuses on getting a competitive edge in
the market by differentiating products or services of Jiffy from that of competitors. Cost focus strategy: Cost focus strategy determines the levels of cost per customer for
Jiffy to become the leader in the competitive market. Differentiation focus strategy: Differentiation focus strategy deals with innovating
additional services to sell as auxiliary products in Jiffy.
From the above discussion the most appropriate strategy for the growth of Jiffy is cost leadership
and offering quality services to consumers in India at lower price than rivals to gain
establishment in market. This can be done by partnering with local firms to boost knowledge and
resources for expansion.
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9 Entry Mode and Market Selection
Process of internationalisation provides a global footprint for a business organisation that would
help to expand beyond their domestic markets (Bayne, 2019). There are several strategies formed
while entering into new markets globally to understand the tastes or preferences of the customers
abroad. Jiffy is now planning to expand its market in India or China. Various strategies for Jiffy
entering into new markets of India and China is underneath: Exporting: Choosing a right kind of export channel is essential for Jiffy to expand its
market in India and China. The suggested channel for this company would be indirect
channel with the help of intermediaries for distribution. Joint venture: The another strategy may include joint venture, this includes project based
partnerships which get dissolved after the completion of a particular contract. This would
lead into the hassle free expansion of businesses like Jiffy into the new markets of India
and China. Franchising: This expansion strategy involves allowing a opening outlets of the
company using the IP of the firm in different international market. In context of Jiffy, this
is an effective strategy because Licencing: The expansion of Jiffy in India can also be done by using the licensing market
entry mode because it helps the firm enter international market without the risk of making
huge financial investment. Here the firm needs to give IP license to specific firm so that it
can manufacture and sell the company’s products and services in exchange of specific
payment.
The best strategy for Jiffy is to partner up with best in class local companies in India and
China whose primary focus is to understand potential risks. This includes choosing the entry
mode of Joint venture to expand in India. Another reason for choosing the joint venture is that
according to survey of 253 countries, joint venture strategies implemented for attaining growth
exceed expectations for success for more than 80% businesses (The Secrets To Successful Joint
Ventures, 2017). The market The partners will have best skills, strategies and resources which
can aid Jiffy in navigating new regulations of business, recruitment of local talent, and
understanding local culture of India. It will also aid them in doing comprehensive market
research where expansion can be considered and potential demand can be understood.
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The market which is most suitable for the respective organization is India. Jiffy needs to
expand to India because it offers vast growth opportunities with welcoming political
environment and economic stability. In fact, India is set to become 2.7 trillion GBP economy
(WHY EXPANDING YOUR BUSINESS TO INDIA IS A STAKE WORTH BIG RETURNS?,
2020). This can be highly beneficial for Jiffy. The managers need to keep prices low at the first
in order to increase the demand for their products. Jiffy has several product line which might be
harmful for them to adopt market development strategy for example, offering Indian consumers
faster e-commerce solutions leading to better profitability.
Recommendations
 It is being suggested to managers of Jiffy to adopt the strategy of partnering up with local
companies in India and China.
 The managers of Jiffy should recruit local people at stores in India and China to avoid
language barriers arising in expansion process.
 The managers should keep full knowledge of laws and regulations in India and China to
avoid legal problems in operating.
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CONCLUSION
From the above information it is extracted that the term globalisation refers to growth of
independence in economies and culture to exchange of goods and services. The globalisation and
internationalisation are revolutionary concept which help in maintaining peace and effective
relations between different countries. PESTLE analysis is a framework used by organisation to
evaluate external environment which identifies opportunities and risks involved. Porter's five
forces model is a framework which analyse and identify five competitive forces which provide a
shape to industry and evaluate the strength as well as weakness.
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