Report on Marketing Entry Strategy of IKEA
Added on 2020-01-21
19 Pages6838 Words83 Views
Business Project
TABLE OF CONTENTSINTRODUCTION...........................................................................................................................3Factors considering when trading across borders.......................................................................4Considerations should IKEA look at when trying to create Social Impact.................................8Consideration for enhancing business performance of IKEA. and applications of academicdiscussion and theories..............................................................................................................12CONCLUSION..............................................................................................................................14REFERENCES..............................................................................................................................17
INTRODUCTIONGlobal business expansion is an activity in which a business starts operations into otherregions throughout the world. Global expansion is far more beyond than an investment in anoutside; as it’s a concept of creating and maintaining actual presence of business in suchcountries. In the present era, international business has significantly gained attention throughoutthe corporate world as many companies are looking for unique and cost effective ways to expandcompany’s business in the overseas markets. This became possible due to globalization whichhas improved trade, boosted labor market and capital mobility as well as enhanced the level oftechnology and its use. The factors have significantly influenced leaders to expand business inentering markets. The growth of multinational companies depends on various factors affectingentry of business into new areas. In the present scenario, multinational companies are findingnew ways to expand business in profitable foreign markets to gain economies of scale.Nonetheless, there are some trade barriers which are still exists in various marketplace andaffects the growth and international expansion of companies. The business report herewith aimsat carrying out various aspects of international expansion of a leading MNC, named IKEA. Thisis a well-known Swedish furniture manufacturer founded by Ingvar Kampard in 1943 in Sweden.The corporate entity manufactures and sells home furnishings and accessories with uniquedesigns. The products of IKEA are offered at low prices so it can be afford by middle classpeople. The vision statement of IKEA is to create a better life for society and in this waycompany designs furniture’s and offer it at the lowest prices. The business idea of IKEA is tooffers rage of designer furniture products at the competitive and low prices to create a uniquebrand image in the marketplace. The major market of IKEA are the people of middle incomelevel and wants to live a stylish life, therefore, it designs unique, cheap and affordable furnitureso as to carter the needs of people who cannot afford designer products. In present scenario, IKEA is emerged as a powerful brand throughout world in terms ofdesigner and affordable furniture seller. The company has successfully expended its markets intovarious emerging markets now it is looking for untapped markets so as to expand businessoperations. The low cost leadership strategy is incorporated with IKEA’s unique business modelso as to carry effective business practices in different markets. At present, the company is
operating in Europe, North America, Asia and Australia and in future it is planning to expand forexpanding business in emerging markets such as Latin America, Africa and so (Case Study –IKEA. 2016). The report herewith is going to deal with number of factors which are to beconsidered by IKEA when trading across borders. The different factors are to be considered atthe time of business expansion across borders and these are discussed here. The company hasexpanded its business globally and is looking for further business expansion which is a majorreason for choosing this multinational company. Further, this unit is going to discuss on theconsiderations which should company look at when trying to create social impact. Variousacademic theories and models have been used which relates to international business andcorporate social responsibilities considered when to expand business in overseas markets.Factors considering when trading across bordersIn the modern setting, it is constitutional for organization to modify their services andproducts and to deal their products across the boundary line so that they can deliver the goods inthe competitive environment (Ryan and Mulholland, 2014). Moreover, in the globalized periodof time trade among assorted economic system plays vital role within the organization as itassists in enhancing their market share with the certain increase in their profitability ratio. Inorder to become the leading furniture company in the market IKEA must ensure delivering theirquality furniture products across the borders. Globalization process is consider as an integral andintegrated concept whose main perspective is to exchange the merchandise and services outsidethe national frontiers. As per the view of Kayser and Peress (2012) trading across borders willhelp the furniture company in increasing and enhancing their sales and profits with boosting theprestige of company so that they may easily attract the customers towards their furnitureproducts. Moreover, trading across the border also benefit the furniture company in exchangingthe technical know-how that will benefit the company in producing the quality furniture ofdifferent styles that results in increasing their efficiency. On the other hand, Koh Fichman andKraut (2012) has also stated that while trading across the borders it benefit the company inimproving the quality of their furniture products. Through setting up or establishing the IKEAmanufacturing store in the developed countries it results in availability of low cost of labour thatwill benefit the company in lowering the cost of production (Busse, Hoekstra and Königer,2012). On the contrary, there are also some disadvantages of trading across border that is with
End of preview
Want to access all the pages? Upload your documents or become a member.
Related Documents
IKEA's Competitive Strategies: A Focus on Marketing and Operations Managementlg...
|6
|1463
|462
Marketing and Operations Management at IKEAlg...
|6
|1543
|99
International Business - Sample Assignmentlg...
|20
|5101
|23
Competitive Strategy of IKEA in Sydneylg...
|10
|2894
|66
Business Strategy: Analysis of IKEA's Internal and External Environmentlg...
|13
|4145
|62
International Marketing: Strategies and Approacheslg...
|12
|840
|23