Global Strategy for Primark: Reasons for International Expansion, Strategic Choices, and Choice of Location

Global Strategy

Table of Contents
INTRODUCTION...........................................................................................................................1
MAIN BODY...................................................................................................................................1
Reasons for International expansion............................................................................................1
Possible strategic choices for the parent company......................................................................2
Reasons for the choice of location...............................................................................................5
Strategic methods of entry...........................................................................................................6
Problems of operating internationally..........................................................................................7
Strategic advice for the overcoming of problems........................................................................7
CONCLUSION................................................................................................................................9
REFERENCES..............................................................................................................................10

INTRODUCTION
Global Strategy refers to the various types of plans which are prepared by an
organization which helps in ensuring that the implementation of various types of
strategies can be done in a highly effective manner within the organization (Arnaud and
et.al., 2016). This report is based on Primark. It is looking forward towards expansion in
Romania. In this report, detailed analysis will be made on reasons for parent company's
international expansion, possible strategic choices for the parent company, reasons for
the choice of location, strategic methods of entry and possible consequences, potential
organizational and managerial problems. Additionally, specific analysis on strategic
choice for the subsidiary to overcome the problems will be discussed as a part of this
assignment.
MAIN BODY
Reasons for International expansion
There are various types of reasons due to which Primark wishes to expand its
operations in Romania. Some of these reasons are-
Evaluation of the company's historical performance- In 2019, Primark generated
a revenue of 7.79 billion pounds. However due to the impact created by the COVID-19
pandemic the overall profits of the company have taken a hit. This has resulted in the
reduction in the level of revenues as well as profits effectively and efficiently (Collinson,
Narula and Rugman, 2017).
Products/Services Range- There are a wide range of products and services
which are offered by Primark to its different types of customers (Cuervo‐Cazurra, Doz
and Gaur, 2020). The range of products and services which are offered by the company
to its customers are baby and children's clothing, womenswear, menswear, homeware,
accessories, footwear, beauty products and confectionery. Thus in this way, it can be
said that a diverse range of products and services are provided by the company to its
different types of customers in the market.
Share of the market- Before COVID-19, Primark had an overall market share of
13% in the market. After the reopening of its stores, the share is down to 8%. Thus it
can be said that due to the impact of the COVID-19 pandemic the overall market share
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of the company has reduced. This has created an impact on the level of revenues and
profitability in the market of the company.
Competitive Position within the industry- The different types of competitors of
Primark are Mothercare, Select Fashion, M&S, New Look, Hansae, Pimkie, M&Co.,
Loavies, Crew Clothing and Terranova. Thus it can be said that due to the use of
appropriate strategies and techniques Primark has been able to make sure that it
acquires a superior position over its different types of competitors within the market
(Cuervo‐Cazurra, Mudambi and Pedersen, 2019).
Thus it can be said that Primark is a company which has been able to ensure
that it has maintained a superior position over its different types of competitors within
the market (Solodova and Golubyonkova, 2017). This has created an overall level of
impact on the profitability and revenues of the company. Thus the company is looking
forward to expand into Romania. This is so because Romania is a country which offers
plenty of scope to the businesses because of the attractive offers made by its
government to these businesses thereby enabling them to be able to ensure that they
are able to enhance the overall level of profitability and revenues in the right manner.
Thus Romania is a country which offers the right opportunities to the businesses so that
they are able to make sure that they can attain their wide range of goals as well as
objectives quite effectively and efficiently. In this way they can progress in the market
and can make sure to acquire a much-required strategic and competitive edge over the
competitors in the market (Wall and Minocha, 2015).
Therefore, after the study of the data it can be determined that Primark is a
company which can strategically expand its wide range of operations within the market
and therefore can attain the specific goals and objectives in the future. Thus, it can be
said that by using the strategy of Internationalization, the company will be able to make
sure that the attainment of the goals and objectives can be done in Romania which will
help in maintaining its own level of efficiency and effectiveness (Agarwalla and
Mukhopadhyay, 2017).
Porter’s Diamond Model is a model which can be used to focus on the
explanation of why certain industries in a particular nation are competitive internationally
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