International Expansion Strategy for Woolworths in China

Report 1
Business International: Woolworths

Report 2
Executive Summary
This report is designed for purpose of developing an appropriate international expansion
strategy for Woolworths Plc. The target market, in which the company has planned to expand
its business, is China. China is the largest market from the point of view of market size. There
are different marketing objectives of Woolworths, which are anticipated to meet in the
Chinese market such as to enhance the efficiency and to gain larger customer base. The core
focus of this company will also be on gaining the customer loyalty for ensuring the consistent
and long term business growth.
According to the findings of this report, it is very important for Woolworths Plc to invest in
marketing and promotion strategies for purpose of gaining the success in business. The
localization strategy should be adopted by company for advertising and promotion of its
products and services. In addition to this, the company should also focus on presence of its
website in local language or Chinese language for showing the respect for Chinese culture.
This would contribute in the long term success of business in China. It is also important for
the company to invest in research and development activities for getting knowledge of
feasibility of different markets for its business.
From the macro-analysis of business environment of Chine, it is observed that China is an
attractive marketplace for the expansion of Woolworths Plc. The GDP of China is recorded
as 12014.61 billion US$ in 2016. In addition to this, the changes in GDP of China in last five
years are observed positive. These data are showing great growth opportunity for
Woolworths, as the high level of GDP is showing high level of purchasing power of Chinese
population.
As per the findings of this report, joint venture strategy is appropriate market entry strategy
for Woolworths Plc for the international expansion of business in China. In addition to this,

Report 3
the company is recommended to focus on warehousing operations to gain superior business
growth in China. There are different international human resources challenges that may be
faced by the company while running business in China. Example of these challenges includes
the fierce competition for talent hunt, lack of qualified candidates for any vacant positions
etc. Due to these challenges, the company may need to hire the qualified employees for
different at higher level of remuneration packages as compared to other countries.

Report 4
Table of Contents
Executive Summary...............................................................................................................................2
Introduction...........................................................................................................................................5
Brief description of Woolworths...........................................................................................................6
Macro-Economic Analysis of China......................................................................................................7
Recommendations regarding production.............................................................................................10
Marketing and R&D Considerations:..................................................................................................12
International HRM Issues and Considerations:....................................................................................14
Conclusion...........................................................................................................................................16
References...........................................................................................................................................17

Report 5
Introduction
International business is the term which includes all commercial activities taking placeto
promote the sharing of goods, services, people, resources, and ideas across the globe. This
report is designed to provide useful information about the globalization of businesses and
their potential impact. The study evaluates it in context of a well-known supermarket chain,
Woolworths Australia introduced in 1924. The report also analyse the environment of China
where Woolworths is planning to expand its operations, using PESTLE tool. The objective of
the report would be to identify the effective business practices and strategies which the
organization would use to become successful in Chinese market. Apart from this, some
valuable recommendations to the company would also be made so that it can compete with
the competitors efficiently.

Report 6
Brief description of Woolworths
Woolworths has been the biggest retail company in Australia since its establishment. For
more than 70 years, the company has been able to sustain in the market successfully with 900
stores and 12000 members across the world. Due to its excellence in product delivery, quality
and customer services, Woolworths has grabbed a significant market share in the supermarket
over Coles and Wesfarmers. It deals in a wide range of goods and services such as food,
clothing and grocery, home instruments and electronic products, loans, and other financial
services (Chimhundu, 2018). The company also proudly collaborates with the Australian
framers so as to offerpure and quality products to its consumers. Now, Woolworths plans to
operate in China as well to achieve the organisational goalworldwide presence and reduce the
overall costs while maximizing the productivity.Woolworths focus on the concept of offering
products at costing not more than five cents. This became agreat idea to attract the consumers
and the sales continued to grow gradually. The concept of applying a range of low priced,
non-perishable products helps the company to build an empire of more than 1000outlets with
turnoverof more than $119 million each year.
Marketing Objectives of Woolworths in China
In Australia, Woolworths has been successful in maintain a leading position in the retail
sector for many years. The marketing objective of Woolworths to expand in Chinese market
is to enhance its efficiency and gain a large customer base. In this regard, the company needs
to strengthen its marketing policies and strategies for lowering the risk of entering into the
new market. Also, there is great demand of daily-use products in all countries and
Woolworths aims to fulfil customers’ needs and wants in order to attain customer loyalty and