International Market Entry: A Joint Venture Analysis for Bistro Rex

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Risks and benefits of a joint business venture to enter international
markets
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Executive Summary
The report has been undertaken through the aspects of finalising the allocation of the concepts of
joint ventures and the organisation of Bistro Rex has been the organisation of the study. The
aspects of the company have been inclined to the development of the business in the
international market and the company could assert on the market entry strategies of joint
ventures to alleviate the profitable purposes. The detailed analysis of the joint ventures would be
reflected on the outcomes of the research and would be inclined to the provisions of result in the
terms of the benefits reaped by the prospects of the joint ventures.
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Table of Contents
Task 1...............................................................................................................................................4
Task 2...............................................................................................................................................9
References......................................................................................................................................25
Appendix 1.....................................................................................................................................27
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Task 1
1. Explanation of the research topic and reasons for choosing it
Globalisation is considered currently as the talk of the town and there are of course some of the
significant factors, which have contributed to this. In the words of Baylis et al. (2017),
globalisation may sound as a simple term, but there is actually more to it. Globalisation brings
people and business closer. It brings the people and the on one common platform and thus
contributes towards the overall development of the place. However, the advantages of
globalisation cannot be listed in a few words; the benefits that are obtained from it are indeed
many. Globalisation is linked mainly with the market entry strategies and it often plays a
significant role, in assuring that the organisations are effective enough in entering the market.
However, there are indeed a number of things, which make the whole of globalisation indeed an
interesting one (Li et al., 2017).
The particular research topic has been chosen for providing an effective idea as to what
globalisation is and how it has affected the international business world in a positive or in a
negative way
2 Aim and objectives of the research
Aim of the research
To determine the risks as well as benefits that is associated when a joint business venture
attempts to enter the global market.
The research objectives
 To identify the risks that are associated with joint venture
 To identify the benefits that are associated with joint venture
 To identify the influence of joint venture on globalisation
 To identify the risks that are associated with the sector and also provide proper mitigation
strategies
3. Scope and the limitations of the project
Included scope
The research that will be conducted below will provide an effective idea as to what globalisation
is and what role do joint ventures play in case of globalisation. The different benefits and the
risks that are associated with joint ventures will also be discussed in the below sections.
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Excluded scope and limitations
The excluded scope identified those things that will not be covered in the research. However,
globalisation will be discussed in the sections and there are of course a number of ways apart
from joint ventures, which are in use. These will be not covered in the below sections.
4. Resources and cost considerations
There are of course a number of resources that will be needed for conducting the entire research
project effectively. The resources as well as cost considerations have been included in the below
sections.
Activities to be considered Time
Estimates
Expenses per hour
(in dollars)
Total expenses
Deciding on the aims and
objectives of the research
5 days $50 $250
Conducting the literature
review
10 days $100 $1000
Deciding the survey
questionnaire
2 days $25 $50
Conducting an online survey 4 days $ 30 $120
Recording the results 1 day $10 $10
Analysing the results 3 days $25 $75
Interpretation and the final
submission
5 days $10 $50
Total days 30 days $1550
Table 1: Resources and cost considerations
(Source: Created by the Learner)
5. WBS and Gantt chart
Work Break down Structure
Activity Start Date
Duratio
n End Date
Researching the topic of the research 01-03-19 2 03-03-19
Inferring the aims and objectives 03-03-19 5 08-03-19
Reviewing the literature 08-03-19 10 18-03-19
Discussing and deciding the research
methodology 18-03-19 1 19-03-19
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Collection of the primary data 19-03-19 2 21-03-19
data analysis 21-03-19 4 25-03-19
Drawing the recommendations and the
conclusions 25-03-19 2 27-03-19
Filing the report and considering the
feedbacks 27-03-19 2 29-03-19
Report submission 29-03-19 1 30-03-19
Table 2: Work Breakdown structure
(Source: Created by learner)
Gantt chart
Researching the topic of the resaerch
Inferring the aims and obejctives
Reviewing the literature
Discussing and deciding the resaerch methodology
Collection of the primary data
data analysis
Drawing the recommendations and the conclusions
Filing the report and coinsidering the feedbacks
Report submission
2/2 2/12 2/22 3/4 3/14 3/24 4/3
Figure 1: Gantt chart
6. Risk Register
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Risks Occurrences
probability
Level of Risk Significance of
Risks
Effect on the
project
Strategies
developed for
mitigation
Not specific
aims and
objectives
Medium High Since the
project aims
and objectives
were not
developed
hence it caused
delays in the
initiation of the
project
The project
was delayed
to some
extent
The existing
aims and the
objectives of
the research
were revised
Ineffective
literature
review
Low High This lead the
research in a
complete wrong
direction and
hence
considerable
time was lost.
Since the risk
was identified
in the initial
stages, hence
the affect on
the project
was not much
detrimental
The literature
that was
collected was
reviewed
again and
proper
secondary
sources were
selected this
time
Poor resource
allocation
Medium Medium There was
ample
confusions
The project
was
temporary
slowed down
and it also
affected the
budget of the
project
The overall
resource
allocation was
reviewed and
were again
allocated .
Table 3: Risk Register
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(Source: Created by learner)
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Task 2
CHAPTER 1 Introduction
If the words of Bayne (2017) are considered then globalisation has indeed brought about
immense changes in the industrial world. The concepts of globalisation rotate around the idea of
bringing the people as well the business closer in one common platform towards the achievement
of a common goal. The advantages that are obtained from globalisation are actually mani-folded.
Globalisation opens up the place to the outside world, thus ensuring the effective utilisation of
resources. There have been instances where globalisation has brought about effective
developments in the place.
It needs to be mentioned in this regard, that there have also been instances when globalisation
has detoriated the social as well as the ecological balance of the place. Hence inferring that
globalisation brings about improvements in the place will always be a wrong assumption to
make. Joint venture is one of the most common methods that are used by the organisations for
entering the global market (Li et al., 2017). However, there are a number of risks as well as
benefits, which are associated with joint venture. For understanding all of these factors, the case
study of Bistro Rex have been selected. The organisation is an example of one of the leading
restaurants operating in Australia. The organisation is now planning to enter the global market
(UK) by entering into joint venture with Ledbury (UK). The current project will consider the
different benefits as well as the risks that are to be considered by Bistro Rex during the entire
venture.
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CHAPTER 2
Literature Review
In the words of Beck (2018), joint venture is one of the common ways through which the
organisations opt for globalisation. In simple terms, joint venture identifies the particular
business collaboration where two or more organisations come together in a joint platform for the
fulfilment of a common goal and objectives. One of the significant characteristic of joint venture
is that it allows both of the parties to enjoy equal control over the business. The profits, risks as
well as the resources are also shared among the parties. However, there are also certain
disadvantages that are related to it. The below section will investigate into the different
advantages as well as the disadvantages of joint ventures as identified in the business scenario.
Advantages of joint ventures
It is quite obvious that when most of the organisations in the business world are opting for joint
ventures, there are of course a number of advantages that are obtained from it. The different
advantages may include
 More new insights and expertise - In the words of Giannakis and Papadopoulos (2016),
most of the organisations opt for joint ventures because it opens up new doors of resources as
well as opportunities for the business. Hence, new insights as well as expertise are always
something that most of the organisations look for in the venture and indeed joint venture
opens up new expertise as well as insights to the business. Briefly, joint ventures helps in
giving new directions to the business.
 More effective utilisation of resources- The joint venture is the process in which two or
more organisations come together to fulfil their own business goals and objectives. It is
obvious that when two business will come together to perform a common goal, they will
need more resources (both in terms of tangible and intangible resources). Hence, it
investigates the local resources and in most of the cases reduces the unemployment rate of
the country extensively (Giddens, 2018).
 Equal participation in risks and profits – When two organisations form a common platform,
the profits as well as the risks are distributed equally among themselves. In most of the
cases, it helps the organisations in overcoming the risks and devising the strategies
accordingly (Giddens, 2018).
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 Relationship building- In the words of Giddens, (2018) business is mostly about building
relationships and maintaining them effectively in the business world. This is exactly what
joint venture does. Since in case of joint ventures two or more organisations come together
towards the fulfilments p of a common goal, hence it aids the development of an effective
relation among the parties.
Brand image- Sharing a common brand image is always one of the greatest advantages of the
process. In the words of Giddens (2018), people are affected more by brand image and since the
brand image of one of the organisations gets shared with the other, it helps the organisations in
attracting more number of customers towards themselves and hence enhancing the sales volume
of the organisation.
Disadvantages of Joint ventures
There is a common saying that every coin has its two sides and taking decisions just by
considering one side of the coin is never the right choice. Hence, before entering the joint
venture, the organisation also needs to consider the disadvantages of the process as well.
Unequal Control – In the words of Grayson and Hodges (2017),l the greatest advantage of
joint venture that it actually allows both of the parties to participate in the process is actually
a hoax. This is actually a ideal case scenario that is never actually identified in the material
world. There are almost no joint venture that enables both of the parties to participate in the
process equally and this turns out to be the greatest disadvantage of the process
Cultural Indifferences- The cultural indifferences however finds the second place in the list.
There are of course some of the cultural differences that persists among the countries when
they opt for a joint venture. In most of the cases, the cultural differences are reflected clearly
in the decisions and hence the joint venture turns out to be a failure at times.
Restricted flexibility as well as the communication gaps – The unequal control along with
the cultural differences brings with it restricted flexibility. These restrict both of the parties to
take the decisions favouring both of the organisations. In cases, the cultural indifferences
even restricts the flow of communication and information among the parties In the words of
Hay and Marsh (2016), this is the place where most of the joint ventures fail
In addition to all of the factors that have been identified in the above sections, since the joint
venture is going to introduce an Australian organisation into the UK market, hence BREXIT
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and its after-effects are something that deserves a special mention in this regard. The exit of
UK from the UN has indeed stirred the whole of the business world (Li et al., 2017). The
social, technological as well as the legal environment of the country has been under drastic
change since then. The laws and the legislations of the country have indeed undergone a
complete reform and in fact, most of the laws are under reformation until now. In the words
of Hirst et al.(2015), analysing which law is applicable and which is not is always a tough
job and has also created immense confusions in the country. These have also affected the
business environment of the country in an adverse manner. Hence, all of these factors needs
to be considered while venturing into the UK market.
Literature Gap
The above section has provided a clear review of globalisation and joint venture along with the
advantages and the disadvantages that are related to the topic, but there are certain aspects that
have not been covered in the above sections. The section has discussed about the advantages as
well as disadvantages of joint venture, but the impacts of these on this particular venture have
not been discussed in the section. For investigating into the practical scenario of these factors, a
proper primary research has been conducted considering all of the questions that are relevant to
the research. It is expected that this will help in filling up the literature gap that have thus been
identified in the research.
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