International Business Strategy

The study focuses on the international expansion of General Pants Co. into Canada and Germany. It assesses the positive and negative factors of the retail market of both countries and provides strategies for successful expansion. The study also recommends suitable policies for the company to adapt to the geological risks attached to the foreign expansion.

Running Head: INTERNATIONAL BUSINESS STRATEGY
INTERNATIONAL BUSINESS STRATEGY

International Business Strategy
Executive summary
International business strategies are those strategies that are formulated by the companies,
which plan to expand their business activities outside the nation of their origin, that is, in the
foreign countries. The study has identified Canada and Germany to be the two suitable nations
for the expansion of the Australian company named Global Pants Co. It has identified the
positive and the negative factors of the retail market of both the countries. The study has also
identified strategies that the company, Global Pants Co., needs to formulate for its successful
expansion in the markets of Canada and Germany. Lastly, the study has provided suitable
recommendations to the audience.

International Business Strategy
Table of Contents
Introduction......................................................................................................................................3
Discussion........................................................................................................................................3
A location selection assessment...................................................................................................4
An institutional assessment..........................................................................................................5
An entry strategy selection..........................................................................................................6
A design of the organisation........................................................................................................6
A corporate citizenship approach model.....................................................................................7
A strategic position for the organisation......................................................................................7
Recommendations to the audience in regards to the international implementation and learnings
to others.......................................................................................................................................7
Conclusion.......................................................................................................................................8
Reference.........................................................................................................................................9

International Business Strategy
Introduction
International expansion is defined as the broad expansion of the business activities
carried out by a company into several other countries in the world, which in simple terms
expansion of the business activities outside the country of origin of the company. International
expansion of business requires suitable strategies to be incorporated for successful establishment
of the business in the foreign country (Alexander, Nobbs & Varley, 2018). it does not only imply
that the business is making investments in the foreign Nation but it has a concept of maintaining
the presence of the actual business activities in the countries in which the business has
expanded. Taking the business to an international country and hence facing and chasing the
international market is a capital intensive and risky strategy (Steenkamp, 2017). Therefore
suitable strategies need to be adapted for making the business profitable and popular in the
foreign Nation. The study below will discuss the international expansion of General Pants Co.,
an Australian company, into the foreign nations Canada and Germany. The study will highlight
as to why this location is selected, the assessment of the institution, entry strategy, organisational
design corporate citizenship approach model and a strategic position of the organisation. Lastly,
it will provide suitable recommendations on the gas that were identified.
Discussion
General Pants Co. is the name of a fashion retailer of Australia. Headquarter of General
Pants Co. is situated in Sydney. the main product of the retailer are clothing, eyewear, footwear,
accessories, denim, street wear, surf wear and skate clothing of several popular brand and it even
manufacturers clothing of its own in-house brand. The company is known to provide top quality
and trending fashion to the people based on skate, pop culture, art and music. According, to the
recent records the company has over 56 stores across various locations in its origin country of
Australia. The company reaching out to the people around the globe buy shipping its products
with the help of online platform (e-commerce). The company plans to expand its business to an
international country, which will help it to seek new market. For that reason the international
markets of Canada and Germany is assessed in the section below, which will help the company
decide, whether to expand in the mentioned country (General Pants Global., 2018)).

International Business Strategy
A location selection assessment
Fashion retail market of Canada:
According to the Consumer Trends Report, the retail sector of Canada is vital and plays
an increasingly important role in the Marketplace of Canada. It has a huge contribution to the
economy of the country. The fashion industry and the regional market of Canada provides huge
number of opportunities to the companies, which plan to expand into the country. In the previous
year more than 50 foreign companies entered into the retail market of Canada, which was a
record breaking issue (Fashion industry statistics Canada. 2018). The retail market sales of
clothing and accessories stores was estimated to be $ 26,049,959 in year of 2011, which was
approximately 5.7 % of the total retail market share. The retail market of Canada is developing
day by day and the GDP of the country is high and inflation rates are low, which increases the
purchasing power of the customers (Affairs, 2013). The main advantages of International
expansion into Canada are the affluent concentration of customers in the metropolitan areas, the
Geographic proximity of the country helps to reduce the costs of transportation, most products
have duty free access and many more advantages. All these common factors make the retail
market of Canada to be suitable and a preferable location for the international expansion of
General Pants Co (Gain.fas.usda.gov. 2018).
Fashion retail market of Germany:
Retail market of Germany is very attractive. It has over 20% of the total purchasing stock
in Europe. The total turnover of the retail market in Germany is about EUR 512 billion, which is
estimated to be more than the total GDP of Sweden. Retail market of the country is ever growing
although it is highly competitive in nature. The strong growth of the market is in terms of its
value sales in the E-commerce market and specialised goods. The Reader industry of Germany is
very important as it employs approximately 3 million people. There exists more than 366000
companies in the market (Business-sweden.se., 2018). The population of the Germany is
shrinking but digital market of the country maintains a stable and a continuous growth. The
market structure of Germany is oligopolistic market, which means it is dominated by large
number of domestic retailers. The prices are competitive in the retail market of Germany. It
offers multiple opportunities to the new entrants, who desire to gain knowledge about the market.

International Business Strategy
The purchasing power of the people is very high and the country has large base of customers
which is a great opportunity for the retailers to expand into Germany (Jll.de. 2018). The retailers
like General Pants Co., which search for new concepts and brands have greater opportunities in
the retail market of Germany. The changing behaviour of the customers also create multiple
opportunities and new demands. However the trip to the new entrance is that the market is highly
competitive and has a large number of domestic retailers, show the prices of the goods need to be
kept low by the newcomers for gaining a dominating position in the market. Thus, one can analyse
that there is more positive factors than negative in the regional market of Germany for which it would be
a good choice for the company to expand into the country (Bnppre.de., 2018).
An institutional assessment
General Pants Co., Australian Retailer Company plans to expand in the international
market to seek knowledge about the customers in the foreign countries and the new demands and
at the same time to increase their overall profitability and popularity in the world. It has already
been mentioned in the earliest actions that for a company to expand in the foreign country, it is
risky and highly capital intensive (Cuervo-Cazurra, 2016). Thus, companies which plan to
expand internationally, needs a foreign policy, which will help the company to adapt to the
geological risks attached to the foreign expansion. It is important for an organisation to view the
foreign policy in an entirely new way so that they are able to manage it properly
(S3.amazonaws.com. 2018). This requires a good foresightedness for the upcoming future
events. These foreign policies will prove beneficial for the companies who wish to expand
globally. General Pants Co. Plans to expand internationally in order to become popular increase
the sales and also to gain knowledge about the international market.
For this purpose, the truth of the chosen foreign Market by the company are the retail
markets of Canada and Germany. The foreign policies will certainly help General Pants Co. to
protect itself from the sudden changes taking place in the international market, which can cause
serious problems for the business and needs to be overcome within time. The companies need
foreign policies to face the issues and protect themselves from any future issues to prevent
damage. It was assessed that in Canada the customers make sophisticated selections of the
products available and the distributors prefer to work with the Canadian brokers, which could be
an issue for the new entrants (Brydges, 2018). The companies that needs to make a foreign

International Business Strategy
policy to fight that and survive in the market. On the other hand, in Germany, there are already
many domestic retailers hence the company needs some strategies, so that it can give same
amount of competition to the existing companies (Rahman, Wong & Yu, 2016).
An entry strategy selection
To facilitate be successful entry into the markets of Canada and Germany, some
intelligent entry strategies must be selected (Vicari, 2016). The company Global Pants Co. need
to hire an international trade specialist, who will analyse the markets to find out suitable
strategies that will enjoy successful establishment of the company in the foreign Nations Canada
and Germany. as it was discussed in the earlier session, the customers in Canada specifically
make sophisticated selections from the good available at the Canadian Stores, the retailers and
the distributors of the country are more comfortable to work with the Canadian brokers which
makes it difficult for other companies to established themselves (StuDocu. 2018). German retail
market is highly competitive with the large number of domestic retailers, which also needs a
specific entry strategy selection. The company, Global Pants Co., can form allies or Collaborate
with a domestic retailer which will help the company to gain new customers (in the name of the
domestic retailer) and successfully established itself (Ayers & Odegaard, 2017).
A design of the organisation
Global Pants Co. in order to survive in the international market of Canada and Germany
may become a multiunit Enterprise. A multi-unit enterprise is defined as an organisation that is
geographically dispersed and developed from several standard units such as service centres
branches Store and few others, which are combined together into large Geography grouping such
as regions, division and district (Lawrence, Pietrafesa & Kaufmann, 2017). Each division has an
onset of managers to take care of the respective departments. Profit and loss statement will then
be based on the number of units that are operating to report to the managers. The departments
responsible for meeting the target that are set by the headquarters of the organisation. The
management levels irresponsible to frame several policies, make strategies, budget, marketing
decisions, and developing programs and pricing, which will help the organisation to succeed in
terms of its behaviour, priorities and actions. The organisation that needs to offer to the people of
the foreign country (Canada and Germany) with more innovative goods and services that match
their needs and are not available in the existing market (The Multiunit Enterprise., 2008).

International Business Strategy
A corporate citizenship approach model
The corporate citizenship model if something which comprises of the social
responsibilities that the businesses needs to undertake (Causes and Effects. 2003). It is also
referred to as the extent to which the organisation meet the ethical, legal and economic
responsibilities, which are established by the shareholders. The charitable activities that are
undertaken by the organisations may not be profitable to them but it helps them to enhance their
brand in front of the people (Crane & Matten, 2016). When companies take up social
responsibilities, for example, doing charity, providing food or clothing to the old and poor
people, child education and few others, it helps the company to gain reputation in the eyes of the
people and thus become popular (Ssc.wisc.edu. 2018). This strategy of adapting social activities
certainly proves to be beneficial for the company. Global Pants Co., after expanding into the
markets of Canada and Germany may undertake several social responsibilities to help enhance
their brand in the foreign countries, which will certainly help in their successful expansion and
establishment (Heald, 2018).
A strategic position for the organisation
The most powerful way to deal with the competition in the market is still not visible to
various companies. Competition prevails in the foreign markets of Canada and Germany, where
there exist many domestic retailers (Scott, 2017). In order to deal with the heavy competition in
the market the company needs to adapt several strategies, they should identify, cultivate and
exploit the core competencies, which will facilitate the growth of the business activities in the
foreign market (Willart, 2015). Global Pants Co., need to identify the demands of the customers
in the foreign country and manufactured good according to that to deal with the competition and
hence increase the sales of the company (Prahalad & Hamel, 2006).
Recommendations to the audience in regards to the international implementation and
learnings to others
Although international expansion is beneficial to the companies, there lies several gaps.
The strategies needs to be selected properly to cater to the demands of the foreign market. The
two foreign markets chosen in this case are Canada and Germany. Both the market have different
threads so Global Pants Co., needs to adapt different strategies for the international expansion.

International Business Strategy
Suicide the competition in the German retail market, the company need to keep its prices
reasonable and in case of Canada the company can form allies with the domestic retailers.
Conclusion
The study above makes it easy to understand the concept of International Expansion of
Business. It focuses on the international expansion of the Australian retailer, Global Pants Co.,
which plans to seek knowledge about the needs of the customers in the foreign market and thus
increase their sales by expanding globally. For this purpose the study assess the markets of
Canada and Germany and highlights the positive and negative factors of the retail sector of both
the countries, which will help the company to formulate strategies for its international expansion
in both the countries. Lastly, it provides relevant recommendations for the process of
implementation of the strategies.

International Business Strategy
Reference
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International Business Strategy
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International Business Strategy
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