Market Entry Strategy Assignment

   

Added on  2020-12-30

48 Pages11035 Words214 Views
RESEARCH PROJECT
Market Entry Strategy Assignment_1
ACKNOWLEDGEMENTI would like to thank to my professor for his kind support. Without his guidance I would notbe able to complete this research successfully. I like to thank to my parents and friends for theirsupport and love. Their encouragement has helped me to complete this research.
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ABSTRACTGlobalization is basically a process or a method through which company, government orpeople intact or integrate worldwide. Its a process of integration and infraction associated withcultural and social aspects. Study uses questionnaire technique for gathering information abouttopic. It is qualitative in nature. Study describes that for raising demand of products franchisorsimplements commercial activities that helps companies in establishing their branch in newlocation successfully. One of the main advantages of implementing franchise option is that entrycost of this strategy is very low. Furthermore, it supports in rapid foreign expansion of business.Franchise is the market entry strategy that supports firm in establishing branch in new locationsuccessfully in limited investments. This is beneficial in order to minimise risk of failure oforganisation in new geographical location. McDonalds is the leading fast food firm thatimplements various global expansion strategies. This aids the organisation in generating hugeprofit and attracting more buyers towards brand. Researcher applies Questionnaire method inorder to gather fresh detail related to subject. Study reflects that franchise market entry strategyis great option for business in order to establish branch in new location and raise performance ofemployees as well.
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TABLE OF CONTENTSTITLE..............................................................................................................................................1INTRODUCTION...........................................................................................................................1Research Aim.............................................................................................................................1Research questions.......................................................................................................................1Research Objectives.....................................................................................................................1Background of company..............................................................................................................1Significance of study...................................................................................................................1LITERATURE REVIEW................................................................................................................2Globalisation................................................................................................................................2Different entry modes..................................................................................................................2Macro environment analyses.......................................................................................................4Specify entry mode......................................................................................................................4METHODOLOGY..........................................................................................................................5Introduction..................................................................................................................................5Research philosophy....................................................................................................................5Research approach.......................................................................................................................5Research strategy.........................................................................................................................6Research choice...........................................................................................................................6Techniques and procedure of data collection..............................................................................7Sampling......................................................................................................................................8Data Analyses..............................................................................................................................8Access negotiation.......................................................................................................................9Research limitations.....................................................................................................................9Ethical issues...............................................................................................................................9Cost..............................................................................................................................................9PESTLE and SWOT for China..................................................................................................10Gantt chart.................................................................................................................................11FINDINGS AND ANALSYES.....................................................................................................11Analyses.....................................................................................................................................23CONCLUSION..............................................................................................................................25
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RECOMMENDATIONS...............................................................................................................26REFLECTION...............................................................................................................................26REFERENCES..............................................................................................................................29APPENDIX....................................................................................................................................30Consent form.............................................................................................................................30Information sheet.......................................................................................................................30Questionnaire.............................................................................................................................31Ethics Form................................................................................................................................33
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TITLE "Effectiveness of franchise market entry strategy for establishing branch in China successfully”.INTRODUCTIONGlobalization has changed the scenario of market. Geographic dispersion has helpedbusiness in increasing their revenues and dealing with mass audience. Entry strategies areconsidered as methods that are used by firms to establish their business in other location.Research Aim“To identify effectiveness of franchise market entry strategy for establishing branch inChina successfully: A Study on McDonalds”.Research questionsWhat are the challenges McDonald’s cloud face in China?What are the benefits of franchise?Why is franchise the best entry strategy?Research ObjectivesTo understand conceptual framework of globalization To explain types of market entry strategies for businessTo determine factors that create issue for McDonalds to enter in global marketTo analysis impact of franchise market entry strategy and its relationship with employeesperformanceBackground of companyPresent study is based on McDonald’s that operates its business across the world andhave developed unique brand image in fast food industry. It has strong chain of fast foodrestaurants. Company is operating in approx. 37241 locations and has generated 22.820billion profits in the year 2017. McDonald’s has employed 235000 employees globallythose who are servicing consumers well. Its main agenda is to become leading fast foodbrand and serve to mass audience globally.Significance of studyThis study will be beneficial for companies that operate in fast food industry as by this waycompanies swill be able to know effectiveness of market entry strategies and will be able tochoose correct strategy for entering into Newmarket. Furthermore, this research will be1
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beneficial for other scholars as well, as they will get brief idea and will be able to conduct studyin the future.LITERATURE REVIEW GlobalisationLee and et.al., (2015) There are various kinds of tools through which enterprises canenter into new market such as export, franchises, joint venture etc. All these have their ownsignificance and disadvantage. It is essential for enterprise to select the best method throughwhich it can meet with its objective.According to (Hollender, Zapkau and Schwens, 2017) Globalization is basically a process or amethod through which company, government or people intact or integrate worldwide. Its aprocess of integration and infraction associated with cultural and social aspects. Its one of themost important part of modern society and also one of the hardest one to grasp. It resultsremoving barriers among all notional economies to encourage flow of goods, capitals, servicesand labour. Many organizations have either been evolved or created into key roles inglobalization process.As per the view of Lee and et.al., (2015) There are many impacts of Globalization onbusiness like: Increased competition: Flow of foreign investment in countries, removingregulations which makes it possible for a business to enter market which was one impossible forthose companies.Greater Awareness and react to needs of customer: Customers nowadays arevery selective for quality, price or service which is being provided to them. Scale economies:large scale production economies can be acquired by selling good across many nations. Becauseof this they become even more competitive.Location flexibility: Many techniques or servicescan be made available and allocated almost at everywhere. Because of this they can gain lowcost labour and many other resources at even lower price.Increased mergers and joint ventures:Allows access to cost advantages and bigger market more freely.Different entry modesFranchising is the method in which firms sell their goods and services throughpermitting other firms to sell their goods (Hollender, Zapkau and Schwens, 2017). Forexample McDonalds is working in many locations across the world, it has implemented thisstrategy that has supported business in making connections with mass audience and2
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increasing profitability of the organization. There is strong relationship between franchiseentry strategy and business performance. Kotabe and Helsen, (2014) argued that If companiestake support of this methodology then it would help in minimizing financial risk of firm.Companies give rights to other firms those, which are local at particular geographic area tosell their goods and services by taking their name. As these big firms have strong reputationin market thus, other local retailers become able to attract more people by using the name ofthese big organizations. This assists entity in establishing their brand in other locationsuccessfully and increasing number of customers as well. This supports firms in maximizingvalue of enterprise with minimum investment. As brands are not required to invest anythingby implementing this franchise market entry strategy.Hollender, Zapkau and Schwens, (2017) stated that through franchise enterprise caneasily enter into new location and can know about standard of that place. This would help inimproving level of performance of its employees. Cavusgil and et.al., (2014) argued that it isnot good strategy because it increases chances of spoiling brand image of the firm. There aremany small retailers those who have taken franchise of big brands but fail to serveconsumers well. This has affected overall reputation of brand to great extent. It is veryessential for business that to give franchise to correct firm which has strong customernetwork and successfully operating operations in particular area. If entity gives franchise tosuch companies that have poor reputation then people will not buy products from that firm.This will affect its operational efficiency and my impact on expansion plan of enterprise aswell.Hollender, Zapkau and Schwens, (2017) stated thatLicensing: It is an arrangement whererights to use a service or product is transfer to another company. It is one of the most usefultechnique to enter into a desired market if that company or organization has large market share.Licenses can be of two types i.e. marketing license or production license. Kotabe and Helsen,(2014) argued that Franchising: It is typically an American process for fast market expansionwhich is growing in other parts of the worlds (Franchise your business, 2018). It is mostly usedfor food industries which has common business model which a company can easily transfer inother market. There are few conditions which comes into picture if we are using this model. Firsteither your brand should have a strong congregation globally or its business model should beunique so that can be utilized globally. And second future competition may be created in future3
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