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International Business Strategy (IBM) Contents Purpose 3 Scope 3 Limitation 3 Countries Shortlisted Countries 5 Poland Market Overview

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Added on  2020-05-28

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RUNNING HEAD: International Business Strategy International Business Strategy 2 International Business Strategy Contents Purpose 3 Scope 3 Limitation 3 Overview 3 Selection of Countries 5 Shortlisted Countries 5 Poland Market’s Overview 7 Critical Analysis on Poland 8 Environmental Analysis 8 PESTEL 8 Porter 5 Forces 11 Radar Map 13 Resource Competency Analysis 13 Key Success Factor (KSK) 14 Consumer Analysis 17 Competitive Analysis 18 Positioning Map 18 Competitive Analysi 18 Xiaomi (2013) in Poland 19 Cultural Analysis- China Versus Poland 21 Strategic Objective in Poland 21

International Business Strategy (IBM) Contents Purpose 3 Scope 3 Limitation 3 Countries Shortlisted Countries 5 Poland Market Overview

   Added on 2020-05-28

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RUNNING HEAD: International Business StrategyInternational Business Strategy
International Business Strategy (IBM) Contents Purpose 3 Scope 3 Limitation 3 Countries Shortlisted Countries 5 Poland Market Overview_1
International Business Strategy 1ContentsPurpose............................................................................................................................................3Scope................................................................................................................................................3Limitation........................................................................................................................................3Overview..........................................................................................................................................3Selection of Countries......................................................................................................................5Shortlisted Countries....................................................................................................................5Poland Market’s Overview..............................................................................................................7Critical Analysis on Poland.............................................................................................................8Environmental Analysis...............................................................................................................8PESTEL....................................................................................................................................8Porter 5 Forces........................................................................................................................11Radar Map..............................................................................................................................13Resource Competency Analysis.................................................................................................13Key Success Factor (KSK)........................................................................................................14Consumer Analysis....................................................................................................................17Competitive Analysis.................................................................................................................18Positioning Map.....................................................................................................................18Competitive Analysi...............................................................................................................18Xiaomi SWOT in Poland...........................................................................................................19Cultural Analysis- China Versus Poland...................................................................................21Strategic Objective in Poland........................................................................................................21Recommended Strategies...............................................................................................................21Basic Strategy............................................................................................................................21Generic Strategy.........................................................................................................................22
International Business Strategy (IBM) Contents Purpose 3 Scope 3 Limitation 3 Countries Shortlisted Countries 5 Poland Market Overview_2
International Business Strategy 2Entry Strategy............................................................................................................................22Recommended Tactics...................................................................................................................22Recommendations..........................................................................................................................22Conclusion.....................................................................................................................................23References......................................................................................................................................24
International Business Strategy (IBM) Contents Purpose 3 Scope 3 Limitation 3 Countries Shortlisted Countries 5 Poland Market Overview_3
International Business Strategy 3PurposeThe basic purpose of this report to assist Xiaomi management in their objective of expanding their market in Europe with the help of appropriate consultation.ScopeMethodologies framework such as PESTEL, Porter’s 5 forces, Porter’s generic strategy and marketing mix strategy are covered under the scope of this report.LimitationThis report does not make the use of primary data. The study and analysis of this report is based on the secondary data.OverviewThe maintenance of global market sales may become a tough task for Xiaomi from October 2017due to sales slump. The phone component order has been reduced by Xiaomi due to 10% decline in its online sales.Xiaomi is considered as the 3rd most-valuable tech-company in the world, worth USD 46 billion. In the year 2014, Xiaomi achieved a growth rate of 227% and marked its name among the top 5 smartphones as a result of its low price smartphones and quality products (Santos & Williamson, 2015).Moreover, Xiaomi’ ability in flash-sell lead it towards selling 2.11 million smartphones in a single day and therefore has set a Guinness record (Zhu, 2018). The global market expansion of Xiaomi was supported to a great extent by the global business vice president, Hugo Barra. His efforts also made India the second largest market for Xiaomi (Tse, 2015).The following figure depicts the global market share for smartphones.PeriodGlobal Market ShareSamsungAppleHuaweiOPPOXiaomi201424.70%15.00%5.80%1.20% (Based onQ3 2014 data)4.80%201522.50%15.90%8.40%3.80%5.60%201620.50%14.40%8.90%5.70%4.3% (Based on Q1
International Business Strategy (IBM) Contents Purpose 3 Scope 3 Limitation 3 Countries Shortlisted Countries 5 Poland Market Overview_4
International Business Strategy 42016 data)Global Market Share of smartphone makers.Sources: (Bicheno 2015), (Lomas 2016), (Gartner 2015), (Miller 2017)The effective global expansion of Xiaomi along with its competitive products has maintained its position in the top 5 market players since the year 2014.However, in the year 2016, Xiaomi faced tough completion from OPPO and lost its 4th position due to 1.3% decline in the worldwide market share. Even Samsung scandals did not benefitted the sales of Xiaomi. The smartphone share of Samsung was conquered by Huawei and OPPO and achieved 2-3% growth in the market share (Glowik, 2016).The following figure depicts the profits and revenue of the main smartphone makers.CriteriaSmartphone Markers Profit from Smartphone Devices RelatedSamsung(Electronics)AppleHuaweiOPPOXiaomi (In Year2014) Revenue(In BillionUSD)91.350157.33025.90020.0704.410Profit (InBillionUSD)18.53061.4801.8300.4400.566Profit toRevenueRatio0.2030.3910.0710.0220.128Global smartphone makers revenue and profitSources: (Samsung 2017), (Apple 2017), (Enterpriseitworld 2017), (Yarrow 2014), (Ghoshal 2016)The above figure shows that the profit to revenue ratio of Xiaomi was recorded at 0.128 which stands in 3rd place among the profit to revenue ratios. Even the market share of Xiaomi was smaller in comparison to Huawei and OPPO, still it enjoyed similar market share .
International Business Strategy (IBM) Contents Purpose 3 Scope 3 Limitation 3 Countries Shortlisted Countries 5 Poland Market Overview_5
International Business Strategy 5However, such advantage was unsustainable. The online store model of Xiaomi was copied by its competitors as a result of which Xiaomi started losing its advantage in online stores to them. OPPO, which is one of the competitors of Xiaomi, somehow manage to exceed the market share of Xiaomi by developing strong online and offline sales. 50% of the online sales of smartphones in China is still held by Xiaomi (Yang & Wos, 2017).The processor required for the production of Mi 6 created certain issues for Xiaomi as the same processor was in high demand from the same supplier. Furthermore, the production cost of Xiaomi was increased as a result of the purchase of patent from Microsoft due to the restriction caused in sale of the Xiaomi smartphones in the Indian market (Paik & Zhu, 2013).The maintenance of distinctive competency created issues for Xiaomi after quitting of Hugo Barra who played a key role in global expansion (Gupta & Dhillon, 2014). This also created the requirement for expansion in the new markets as the growth in the global market share was significantly affected. Selection of CountriesShortlisted CountriesOut of the Europe’s 50 countries, Poland, United Kingdom and Romania was shortlisted.Xiaomi took the decision on the basis of Ease-of-doing-Business-Index in which these countries scored below 36. However, the risk to business was less as these countries had positive 0.2 political-stability-index. The below figure depicts the determination of the country for expansion in Europe on the basis of analysis among three countries.Scale, 5 = Very Favorable, 4 = Favorable, 3 = Min in Favorable, 2 =unfavorable, 1= Very UnfavorableCriteriaWeightagePolandRomaniaUnited Kingdom(UK)Score, ScaleScaleScoreScaleScoreScaleScoreSmartphonePenetrationRate0.341.230.951.5Population of0.341.241.230.9
International Business Strategy (IBM) Contents Purpose 3 Scope 3 Limitation 3 Countries Shortlisted Countries 5 Poland Market Overview_6

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