Risk and Benefits of Expanding Business in India

KNOWLEDGE EXCHANGE
PROJECT

Table of Contents
INTRODUCTION...........................................................................................................................4
Literature Review.............................................................................................................................5
Theme: Develop the understanding of project management for business expansion. ................6
Theme: Analysis the risk and benefits of expanding business....................................................6
Theme: Strategies to overcome the risks.....................................................................................7
PROJECT OBJECTIVES................................................................................................................8
PROJECT METHODOLOGY.........................................................................................................9
Project Planning and Resourcing Phrase.......................................................................................12
Project results and findings............................................................................................................14
Evidence of Activity..................................................................................................................14
Objectives Achieved..................................................................................................................17
Impact on Business....................................................................................................................17
Sustainability Plan.....................................................................................................................18
Reflection.......................................................................................................................................19
CONCLUSION..............................................................................................................................20
REFERENCES................................................................................................................................1

INTRODUCTION
Aldi is one of the leading supermarket founded in Germany in 1993. They are widely
spread in many countries like United nation, Belgium, Netherlands, France, Poland, Spain and
many other countries and had over thousands of store all over the world. To increase the market
share of Aldi, company is looking for expansion in Asian market where consumers demand is
being seeing very high. Whereas, Indian market is one of the potential market that are
developing and good investment option for the company. To meet the demand and supply of
Indian consumers, Aldi expand their business in an Indian market.
For expanding Aldi business to Asian market particularly in Indian market, Aldi face
some of the challenges and issues before coming into the market. These challenges are from
competitors which are already taken major of the market shares and having their loyal customers.
Major competitor are Walmart and Tesco which are already in Indian market and provide with
the same goods and services. Aldi has to be very effective in offerings and attracting the
customers towards the company over the competitor. Another major issue is the government
rules and regulation are very strict for the foreign companies. Penalties to annual charges by the
government are very high in Indian market which affect the operation of company. Lastly, major
issues is to meet demand and supply for the product through various offers to attract more of the
customers. The Indian market is very dynamic and changes occurred very rapidly which can
affect the company flow of work to meet the demand and supply of goods dealing by Aldi.
Cost benefit Analysis is a method to know the benefits and cost of new projects and
indicate companies that need to invest or not in a particular project. For expanding business in
Indian market, Aldi cost benefit analysis is being made and shows the following results:
COST
Category Cost for One year.
Lease of land and Building $15,000
Workstation include Furniture and hardware, technical software $7,500
Salary including incentives for store and recruitment cost $50,000
Cost of Training and development $2500
Total $75000

BENEFITS
Category Benefits within One year.
Increase in Total revenue with 50% in India $190,000
Indian labour is 15% less than UK $40000
High productivity in Indian labours by 10% $42000
Total $272,000
It can be seen that, if Aldi invest in Indian market they will earn good enough profit in
their first year and also cover full cost within their first year of investment. From the above
analysis is shows that all the cost that are incurred at a time of investment in Indian market, other
market shows quite high cost for the same. Whereas, benefits that are generated from revenue is
increase to 50% from the market and due to cheap labour and high productivity it increases the
benefit part from the company by saving cost from Indian market. The net benefit from the
Indian market investment is $103,000 for their first year which is quite good when it compares to
other market which give average return from those market. However, it shows the good
investment decision for Aldi to invest in Indian market and to expand their business.
Literature Review.
Theme: Current trends in Indian market.
The Tripathi, Gautam,and Lal, (2017) state that, Indian country is one of major
developing market where consumers are demands are increased with time. There are larger
number of suppliers which are providing grocery items in market with high cost. There are only
few numbers of companies which are providing high quality products with effective price.
Whereas, consumers are willing to purchase from big brands that provide high quality product
with effective price offers on the consumer products. Foreign direct investment had increase in
Indian market share where foreign companies are willing to serve in Indian market. As India is
developing country, high employment is available in market and cost of investment is very low
when it compares to other market. In support with above statement Farooqui, and et.al., (2018)
state that, India in now one of the most developing countries which had high amount of
investment return to all investor. For company's who are looking for expansion in India is one of

the great option. The cost of investment is quite low when it compares to other countries like
labours are very cheap and productivity of labour is high as compare to other country labour.
While the return on investment is quite high for the investors due to increase in economy of
India.
Kumar, Prakash, and Kumar, (2021) contradict the above statement, as Indian is the
developing country that is looking for investment for foreign companies and have very dynamic
economic stability in the market. It can affect the company's investment and cause with losses if
the market changes. Whereas, local producers had taken major of the market that are restricted
foreign companies to create loyal customers. In order to attract the customers, company
sometime face losses to sell the product which are non-durable in nature for longer terms.
Theme: Develop the understanding of project management for business expansion.
As per the review of Zolfaghari, Aliahmadi and Mazdeh (2017), for expansion in new
market by company adopt project management technique for proper implementing the project of
company in new market. Project management stages shows the 5 major steps that are followed
by company. Where initiation stage is the process to identify the trends, demand and supply,
behaviour of consumers and economic changes that are occurring in new target market. This
stage also analysing the risks and challenges that can be faced by company before investing. But
author argued on next step is planing for investing in new market. Through analysis of various
risks and challenges by company that faced in market effectively planning in considering all
risks. This stage shows the process and direction that need to be followed by management in
order to get successful in project.
As noted by Marović, and Hanak, (2017), execution is the most important step that allow
company to get success in the project. This step allows company to implement the planned
project in market to get achieve the target final target. This steps shows the roles and
responsibilities assign by company to their employees to complete project on time and operate in
new market. While, author illustrated on last two steps which are monitoring and project closer.
To achieve the aim of company with new project, proper monitoring by the project manager and
company leaders is very important to avoid the losses and risks that are uncertain in nature. It
allows company to complete the company's project efficiently that save cost and time and
wastage of resources that are used in project. However, last step shows the completion of project