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The Challenges of Globalization - IKEA

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Added on  2021-02-20

The Challenges of Globalization - IKEA

   Added on 2021-02-20

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Task 2 Globalisation IKEA
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Table of ContentsINTRODUCTION...........................................................................................................................3TASK 2............................................................................................................................................3The challenges of globalization for global business trying to enter into new markets................3The key strategies complexities faced by the organization while operating globally.................4Recommendations for the chosen organization on how to overcome these challenges..............6CONCLUSION................................................................................................................................7REFERENCES................................................................................................................................8
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INTRODUCTIONGlobalisation refers to increase in trading activities between countries at global level.This consists of the process in which people, government and companies interacted with oneanother globally. Report is based on IKEA. The company is engaged in the business of assemblefurniture and kitchen appliances. Assignment will cover the task 2 in which it will explain the various challenges ofglobalization faced by the chosen enterprise while entering into new market. Furthermore, it willdiscuss the key strategies complexities faced by the company while operating globally. Lastly, itwill provide necessary recommendations in order to cope up with these challenges. TASK 2The challenges of globalization for global business trying to enter into new marketsIKEA is known for designer and stylish furniture range at global level. It is best knownfor providing low prices innovative furnishing but somehow it is facing challenges whileentering into new market. These challenges are elaborate as follows - Language and Cultural barrier – IKEA is facing this challenge while they are trying toenter into new markets. To attain the customer's retention at global level communicationplays an important role. For making them understand about the product features andquality is crucial to talk with them in their mother tongue. Cultural barrier also influencedwhile taking the major decision about the product designing (Gygli, Haelg and Sturm,2018). People of various culture background prefer different custom design in theirfurnishing. This makes harder task for IKEA to match up with the customer's choices andpreferences. Local competition – Locally establish firms are also creating tough though competitionfor the IKEA brand during global expansion. As the local people in various regions indifferent countries are not trusting IKEA easily they are still preferring their local brandinstead (Potrafke, 2015). The company needs to be aware what the competitors are doingin order to take lead from the rival. Building relationships with the distributor and findingreliable partners for their business, it is a harder task to be achieved while entering intonew markets.
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