Global Strategic Management: Fashion Universe Expansion in Bangladesh

This report provides a comprehensive analysis of Fashion Universe's global strategic management, with a specific focus on its potential expansion into Bangladesh. The report begins with an executive summary outlining the key aspects of foreign market expansion, followed by an introduction that sets the context for the analysis. It delves into the global economic landscape, particularly the rising costs of production, and how this impacts Fashion Universe. The report then explores strategic planning considerations, the economic conditions of Bangladesh, and various market entry modes suitable for the company. A detailed examination of both internal and external business environments is conducted, including a SWOT analysis. Furthermore, the report discusses the role of technology implementation and social media marketing in the context of business expansion. The conclusion summarizes the key findings and recommendations for Fashion Universe's strategic approach to entering and succeeding in the Bangladeshi market.

Running head: GLOBAL STRATEGIC MANAGEMENT
Global Strategic Management
Name of the Student
Name of the University
Author Note

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Executive summary
The purpose of the following paper is to discuss about the different aspects of the foreign market
expansion of the business organizations. For this particular paper, the retail fashion store Fashion
Universe has been chosen. The country in which they are to expand their business is Bangladesh.
As Bangladesh is an emerging power in the Asian continent, many things have to be kept in
focus because of that. There are many developed countries in Asia like India and China. The
reason for selecting this country is the fact that Bangladesh have a huge workforce and Fashion
Universe can utilize that huge workforce for their benefits. These things have been discussed in
the paper along with the economic condition of the country. The strategic planning for expanding
their business into Bangladesh has been discussed as well. Other important things that have been
discussed in this context are the internal and external business environments that affect an
expanding business organization. The need for implementing technology and the use of social
media has been explained in this scenario as well.

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Table of Contents
Introduction......................................................................................................................................3
Global economy and rising of production costs..............................................................................4
Strategic planning............................................................................................................................4
Economy of Bangladesh..................................................................................................................5
Market entry mode...........................................................................................................................6
Business environments....................................................................................................................7
Internal business environment.....................................................................................................7
External business environments..................................................................................................9
Social media marketing.................................................................................................................11
Conclusion.....................................................................................................................................12
References......................................................................................................................................13

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Introduction
The purpose of the following paper is to focus on the manufacturing process in
Bangladesh. This has been regarded as one of the most notable economic powers in Asia and
they have developed their position in a big way. The discussion has to be made by following the
given scenario of the organization that has been selected. It has been noted in the recent years
that the manufacturing prices have been increasing in a great deal in the developed countries.
This is due to the fact that the laborers want more wages for their efforts. Their demands are
higher from different angles. The laborers are much educated and they know about the wages
that are being paid all over the world and the standard wage levels along with the standard
working hours for the laborers. If the manufacturing company cannot provide the proper wages
and make the laborers work for that particular working hours only, the workers will not agree to
work for them (Chen and Sandino 2012). On the other hand, the manufacturing companies will
want to get the most amounts of works within a certain point of time by investing lesser amount
of money.
This given scenario concerns around the Fashion Universe that was founded in 1970 in
Australia. This company manufactures clothing labels with the retail stores. The headquarter of
the company is located at Brisbane. They sell their merchandise all over Australia in almost all
the capital cities. They have built a pretty strong brand reputation for themselves (Roper and Fill
2012). The price to which they have been able to keep their brands is $40 to $399 in Australian
dollars. The problem has arisen that the management of the company is very much worried about
the rising of the costs of manufacture and they have selected Bangladesh where they want to
manufacture their products.

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Global economy and rising of production costs
The production costs of the products have been rising all over the world and almost all
the industries. The demand curve is one of the most important things in this context. The cost
figures have to be displayed by the business companies and discussed over the meetings (Buera
and Kaboski 2012). This organization fashion universe has to decide upon the retail prices of the
products. The cost price of the wholesale buyers and the manufacturers has to be compared and
at one point of time, the cost price needs to justify the sustainable profit the manufacturer will
make. If this profit is not made, the manufacturer will face losses and Fashion Universe has been
going through the same thing (Buera and Kaboski 2012). They are not being able to meet the
organizational objectives in terms of their production and make profits for the organization. The
thing that hinders them is the rising prices for buying the key elements and the raw materials for
the product.
Strategic planning
The business owners have to make the strategic decisions if they want to make the most
profits. In this case, the owners of Fashion Universe are not being able to incur the profits
because most of their income is being spent behind buying the raw materials for the production
process (Barney 2014). They are not being able to supply the proper amount of goods to their
customers that is affecting them in their business figures. The only way to combat this situation
is to outsource their manufacturing to other countries. The supply levels have to be increased and
this can be done only through shifting the production to another country.

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Economy of Bangladesh
In the given scenario, the company Fashion Universe will be looking to shift their
manufacturing process to Bangladesh. This country is considered to be one of the rising
economies in Asian continent and they are preparing to become one of the strongest ones (Lewis
2013). In the present business context, they will be looking to invest their capital in that country
just because they will be able to get the cheap labor there. They will also be able to make the
laborers work more than the working hours in Bangladesh than in Australia itself. The laborers
are also not as much educated as the Australian ones (Lewis 2013).
It has been noticed in the past years that the economic development has been sometimes
steady and sometimes threatening as the country is under a fragile rule of law. The problems in
that country are related to the fact that the economic management in that country is not always
up to the mark and sometimes very poor. The per capita income of that country is $3.607 and the
GDP of the country is about $576.5. It has an economic growth around 6.4%. The economy is
very much informal and it is driven by the poor political condition and corruption within the
country. The economic dynamism is also very much responsible for this as well (Wiens and
Jackson 2015).
These things are very critical for the company as they have to develop some strategies to
confront this situation and export their manufacturing process. The Bangladesh economy has
been suffering from many setbacks in the recent years. The Australian company Fashion
Universe investors will help the Bangladesh economy to improve on certain grounds. This will
be very helpful for both the sides (McNerney, Fath and Silverberg 2013). The Fashion Universe
can capitalize on this by getting their work done by investing less money but getting the
production done within a certain period of time and on the other hand, the Bangladeshi economy

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will be re-energized. Most people in Bangladesh do not have any particular or permanent
profession. Either they invest their time in agriculture or they do part time professions. Most of
the money from the Bangladesh government comes from tourism and agriculture. The need for
income is an evident thing for the Bangladeshi people (Islam 2012). Fashion Universe can get a
big market in the neighboring countries of Bangladesh like India, China,. Sri Lanka, Malaysia
and others.
Market entry mode
If Fashion Universe tries to get into the market of Bangladesh and produce their goods
there and then again export it back to Brisbane, they have to apply the different market entry
modes (Grünig and Morschett 2012). These market entry modes are indeed vital for every
organization. The Fashion universe organization has targeted the vast population of the Asian
contingent and they will look to utilize this opportunity in the best way. The management is
concerned about the production of the goods in Australia and they will be very jubilant when
they grab this opportunity.
The market of India and China is the largest in Asia. In Bangladesh, the laborers will
agree to work on a lower wage because they have to feed their families. There are different types
of market entry modes. They are exporting, licensing, joint venture and direct investment
(Grünig and Morschett 2012).
Exporting
Exporting is the way or the strategy in which goods are produced in another country by
exporting the manufacturing process and machines there. Exporting is one of the most traditional
and conventional way to reach the foreign markets (Fabling and Sanderson 2013). It does not

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require the goods to be produced in that particular country so the need for foreign production
facilities is not required by the organization. In this case, Fashion Universe will be implementing
this same strategy as well because they are rest assured that they do not have to take the help of
the production facilities of Bangladesh. The most of the investments that are required in this case
is related with the marketing expenses of the company (Fabling and Sanderson 2013). This
process of exporting can take place only when four types of players are present in the process.
These four players are exporters, importers, transport providers and the local Government.
Business environments
Apart from the focusing on, it is of utmost importance for Fashion universe to focus on
the business environments for understanding the business context over there and the business
culture of that particular country (Pulver 2012). The business environments include the internal
environments and external environments. These things are the measure sticks for any company to
understand how they will be operating in a different countries and what things they need to
concentrate on.
Internal business environment
When the internal business environment of an organization is analyzed, the need to
evaluate the strengths, weaknesses, opportunities and threats of the organization along with the
organizational culture of the company is very much significant. In this case, the SWOT analysis
of Fashion universe has to be done as well (Kuratko, Hornsby and Covin 2014)
Strengths
 The policies of the Fashion universe are very customer friendly so it will help them to
gain a wide range market in Bangladesh (Grant 2016).

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 The brand recognition of Fashion Universe is quite strong so they need to focus on gain a
better customer group under their disposal by using this brand recognition (Huang and
Sarigöllü 2014).
 The designers who work for the company are much innovative and their innovativeness
will drive the organization to be a popular one among their rivals.
 They produce their clothing apparels at such a price range that the middle calss buyers
will also be able to avail them (Grant 2016).
 The potential customers will have to be targeted by using their customer profile and
Fashion Universe is an expert in these things.
Weaknesses
 Fashion Universe sometimes puts in some unnecessary costs that hinder the average or
low income buyers to buy their apparels.
 Their presence in Asian continent is not much known so they will have some primary
problems before kick starting their business effectively (Grant 2016).
 They have appointed some inexperienced designers in their retail branches in the past that
has affected their business in great ways.
Opportunities
 The area in which they are planning to operate is very much open to the activity of retail
stores as there are not much retail stores in Bangladesh.
 Raw materials will be very easily available with a cheap labor force. So Fashion Universe
will have large opportunities to spread its business (Grant 2016).

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 The loosened commercial restrictions of Bangladesh will add to the benefits for Fashion
Universe.
 They can use the technological advancement in Bangladesh that will give advantage to
their operations as well as improve the economy of Bangladesh.
Threats
 Internal politics is one of the major threats for Fashion Universe because the current
political condition of Bangladesh is not proper enough to start a new business (Trimi and
Berbegal-Mirabent 2012).
 The struggling economy will be a threat to gain the expected support from the
Bangladesh government.
 If the political problems and movements continue to grow, it will be extremely difficult
for the Fashion Universe to get the raw material supply within a certain point of time.
External business environments
The main component of the external environment of a business is to discuss about
different aspects that have to be analyzed in the PESTEL analysis (Gupta 2013).
Political factors
The political condition at Bangladesh at present is not stable enough so that Fashion
Universe can make a sustainable entry at the moment. However, they can expand there in spite of
these uncertainties because they will be able to get the support of the Australian Government by
mutual settlements. As this is potentially a huge market they cannot ignore this market at all. The
political unrests will stop at one point of time and they must wait for that. As this is a democratic
country, the conditions will surely to be improved (Gupta 2013).

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Economic factors
The Bangladeshi economy is going through a crisis period and the claws of global
inflation are looming large on the trade industry. There is corruption all over the country and the
poor people die of hunger and suffer from malnutrition. In this scenario, Fashion Universe
should be investing in Bangladesh however critical the scenario is because this will help to
improve the economic condition of the country. They can perform their CSR activities to a new
level that will be able to transcend the economic barriers and strengthen the economy (Lee, Park
and Lee 2013).
Social factors
Bangladesh is by far a Muslim dominated country by majority and they are divided
between certain social classes mainly based on their income levels. Fashion Universe should aim
to launch some customer-friendly design with a range that can be affordable by their potential
customers of all classes. People in the country are not much educated so Fashion Universe can
launch some academic programs for the poor people as part of their CSR activity (Lee, Park and
Lee 2013).
Technological factors
The technological factors have to be utilized in the country of Bangladesh because they
are not much accustomed to the technologically advanced. One thing Fashion Universe can do is
to introduce the new technological advancement tools in the Bangladesh market and be the
pioneering organization to sell their products through the help of technology. They can introduce
the digital payment options and the ways they can improve the system is to make the customers
avail their products through online marketing via mobile apps.

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Environmental factors
The various environmental factors including the climatic features and effect of the
cyclones that affect the country very often have to be kept in mind by Fashion Universe. They
must set up their retail marketing outlets at such places where the urban population can avail
their fashion accessories (Czinkota and Ronkainen 2013). This will be very helpful for them.
They should also set up a good logistics supply chain network by which they can dispatch the
apparels purchased online to the shipping addresses. Choosing the right location is a very
important matter in this aspect.
Legal factors
The legal factors are very important in the case of Fashion Universe as of any
organization who is expanding their business into a foreign country (Erdoğmuş and Cicek 2012).
All the legal frameworks regarding business expansions should be maintained by Fashion
Universe so that they will not be facing any legal hazards in the coming times. The local
employees will have to be paid according to the law if they are hired (Erdoğmuş and Cicek
2012).
Social media marketing
Another important aspect in the marketing of Fashion Universe is to segment their target
markets and appeal to them by using the social media (Tuten and Solomon 2014). As social
media is a very popular aspect among the young generation and they are quite aware of the
popular fashion trends in the recent times, they can be targeted in the urban areas of the country.
Thus, Fashion universe will be able to gain the support of the young community by being hugely
present in the social media platforms and connecting to their target audience.

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Conclusion
This paper can be concluded by saying that as Fashion Universe has been a successful
fashion retail brand in Australia; they will be quite interested to expand their business in
Bangladesh as this is a very populous and emerging country in the global sphere. There may be
some primary obstacles and barriers for them to shift their business, they have to concentrate on
the various market entry modes. The political and economic barriers are there as well. These
barriers have to be overcome by segmenting their target market to the young generation of the
country and using the social media as a special weapon to attract them toward their organization.
They have to analyze their strengths and weaknesses in this context as well because as it will
help them to show their strong presence in the Bangladesh market with an effective strategic
planning.

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