International Market Analysis Report: Qatar and Lebanon

This report provides an international market analysis for a Jordan-based pharmaceutical company seeking expansion into Qatar and Lebanon. The analysis employs the PESTLE framework, industry analysis using Porter's Five Forces, and Hofstede's cultural dimensions to assess the business environments of both countries. The report evaluates factors such as political stability, economic indicators (GDP, per capita income, inflation, and unemployment), social and technological environments, legal frameworks, and environmental considerations. It identifies industry opportunities, including customer and supplier power, threats of substitution, and new entrants. The report then examines various market entry strategies, including direct exporting, licensing, franchising, and joint ventures, before recommending a joint venture as the most suitable approach for entering both Qatar and Lebanon, with a priority on entering Qatar first due to its more favorable business environment. The report concludes with implications and recommendations for the company's market entry strategy.

RUNNING HEAD: INTERNATIONAL MARKET ANALYSIS
MANAGEMENT
INTERNATIONAL BUSINESS ENVIRONMENT

INTERNATIONAL MARKET ANALYSIS 1
Executive summary
Analysing international business environment is an essential step for entering the global
market. The Jordan based company engaged in pharmaceutical business is seeking for market
entry for business expansion.
The Qatar government charges low corporate tax than Lebanon government. The Qatar offers
better economic environment in terms of Gross Domestic Product, Per Capita Income,
Inflation and Unemployment rate. It also offers favourable technological and ecological
environment. Additionally, both the countries provides passable social and legal
environment. Based on industry analysis of both the countries, they offer opportunities from
low customers bargaining power, low threat of new entrant, and low suppliers power. The
Hofstede cultural dimensions depicts that both the countries have attained different score than
Jordan (home country).
Elements such as fine population strength, better ranking in innovation index, low health
status and low long term orientation are responsible for choosing Qatar and Lebanon for
market expansion. There are multiple strategies to enter in the market. It mainly includes
direct exporting, licensing, franchising, partnering, and joint venture. However, each has its
own pros and cons. For market entry in Qatar and Lebanon, Joint Venture strategy is best
suitable. This will benefit in gaining higher resources, support, better knowledge about the
host country (Qatar and Lebanon) customer and market. The company should enter first in
Qatar as it provides more attractive business environment than Lebanon.

INTERNATIONAL MARKET ANALYSIS 2
Contents
Introduction................................................................................................................................3
Environment Analysis................................................................................................................3
External Environment.............................................................................................................3
Industry opportunities.............................................................................................................4
Hofstede cultural dimension...................................................................................................5
Choice of Country......................................................................................................................6
Market Entry strategies..............................................................................................................7
Appropriate market entry strategy.............................................................................................8
Implication..............................................................................................................................8
First entrance..........................................................................................................................8
Conclusion..................................................................................................................................8
Bibliography.............................................................................................................................10
Appendices...............................................................................................................................13

INTERNATIONAL MARKET ANALYSIS 3
Introduction
The report focuses on the concept of ‘International business environment’. A careful analysis
of international business environment is essential for smooth business operations (Cantwell et
al., 2010). It reflects around an entrepreneur of medium sized company engaged in pharmacy
business in Jordan. It involves analysing two countries for appropriate international markets.
Emphasizing on report structure, the initial part includes the environment analysis of two
countries named Qatar and Lebanon. It involves the use of PESTLE framework. This section
also comprises of Industry analysis of both these countries. Additionally, it involves the
application of Hofstede Cultural Dimensions to gain an understanding about the countries.
The next section comprises of various reasons of country selection for market expansion. The
passing segment includes evaluating multiple market expansion strategies. It also includes the
implication of each strategy. Lastly, it includes choosing the suitable market strategy for
entering in Qatar and Lebanon.
The key objective of the report is to discover and analyse two appropriate countries for
market expansion of pharmaceutical company.
Environment Analysis
External Environment
PESTLE Analysis
It is a framework to evaluate the external business environment of a country. It takes into
account six factors named Political, Economic, Social, Technological, Legal, and
Environmental (Ho, 2014). It involves evaluating these factors in terms of Qatar and
Lebanon.
Political factor: It includes elements such as government integrity, corporate tax and trade
restrictions. In Qatar, the Corporate Tax Rate (CTR) for foreign companies is mere 10%. The
government impose low restrictions on the entry of foreign companies. Additionally, fine
government integrity prevails in the country (Heritage, 2019). In Lebanon, the CTR is 15%.
Moreover, the cost of starting business is subsequently high in the country. Political
instability is seen in the country (Heritage, 2019).

INTERNATIONAL MARKET ANALYSIS 4
Economical factor: It focuses on factors like population size, Gross Domestic Product, Per
Capita Income, Unemployment level, and Inflation rate. In Qatar, the population strength is
2.7 million. Its GDP is $340.6 billion. Additionally, its unemployment and inflation rate is
0.1% and 0.4% (Heritage, 2019). In Lebanon, the population size is 4.5 million. The GDP is
$87.7 billion with a growth of 1.2%. Moreover, the unemployment and inflation rate is 6.6%
and 4.5% (Heritage, 2019).
Social factor: It takes into account factors like customer buying behaviour, health status, and
price sensitivity. The Qatari customers rely on reviews and feedback to purchase a product.
They are also willing to try new products (Societegenerale, 2019). In Lebanon, lack of trust
prevails between Lebanon customers and seller (Societegenerale, 2019).
Technological factor: It includes factors like level of technology, innovation, data speed and
automation. Among 140 countries, it ranks 29th for innovation and technology
(Tradingeconomics, 2019). It is assessed that Lebanon ranks 88th for similar category.
(Tradingeconomic, 2019).
Legal factor: It mainly considers the property rights, health and safety laws. In Qatar, the
government lays mediate attention towards safeguarding patent rights (Heritage, 2019). The
Lebanon government strictly protect the property rights of the business enterprises (Heritage,
2019).
Environmental factor: It focuses on level of resources, and climatic conditions of a country.
Qatar is very less exposed to natural disaster (Nricafe, 2019). Additionally, Lebanon faces
small scale natural disasters including flood and landslide.
Industry opportunities
Porter’s Five Force Model
Porter’s five force model is beneficial in analysing the favourability offered by an industry
(Magretta, 2011).
Industry Rivalry: The key pharmaceutical company in Qatar are Avanzcare, Qatar Life
Pharma and QPI (Qlifepharma, 2019). There are multiple companies engaged in pharmacy
business in Lebanon. It includes Arwan Pharmaceuticals, Omnipharma, Omnilab, Pharmaline
and Ultima (Marcopolis, 2012). Therefore, it states that high competition prevails in
Lebanon.

INTERNATIONAL MARKET ANALYSIS 5
Customer power: The customers have low bargaining power because population strength in
both the countries is fine. Additionally, the customers have low high price sensitive
(Societegenerale, 2019). Therefore, customer’s low bargaining power develops a chance for
the company.
Supplier power: In Qatar, there are many suppliers for pharmaceutical products. It includes
Al Ahmedia Trading % Contradicting Co, and Al Danah Medical Co WLL
(Qataronlinedirectory, 2019). NALP and UPO are suppliers and distributors of Lebanon
(Nalp, 2019). It acts as an opportunity for the company as it can easily attain raw material and
other essentials from suppliers.
Threat of substitution: The pharmacy companies of both the countries offer similar drugs
and medicines. The content of these drugs and medicines is similar but they differ in size,
shapes packaging, and brand. Therefore, it acts as threat to the company.
Threat of new entry: The existing pharmacy companies of Qatar and Lebanon attain high
good will and patent rights (Qlifepharma, 2019). They have loyal customers as they are large
in size. Therefore, Jordan based company will face low threat of new entry in both the
market. Hence, low threat acts a opportunity for the company as it will not face fear of losing
market share.
Hofstede cultural dimension
Power Distance: Lebanon ranks low whereas Qatar ranks high in this index. This states that
power distribution is low in Qatar. In the presence of high power distance, formal relations
prevail between higher and lower level of management.
Individualism: Lebanon scored high in this dimension. It depicts that people of Lebanon as
well Qatar consider themselves as an active part of group. They lay prior attention in
achieving group objectives and goals.
Masculinity: It is high in Lebanon and of mediate level in Qatar. It means that Lebanon
employees lay high attention in competition, and fulfilling their ambitions and achieving
materialistic benefits.
Uncertainty avoidance: It is the degree to which people show avoidance to unknown and
ambiguous situations. Qatar ranks extremely high in this index. This states that employees in

INTERNATIONAL MARKET ANALYSIS 6
Qatar show unwillingness towards uncertainty in the workplace. However, it is contrary in
case of Lebanon.
Long term orientation: It is extremely low in Lebanon. This states that Lebanon employees
are focused on their present work. It is mediate (41) in Qatar. This depicts that employee’s
lays attention on their current as well as future (Dulaimi & Sailan , 2011).
Indulgence: Low indulgence in Lebanon states that population follows restraint culture. It
states that Lebanon employees adhere to their social norms and regulation. They show less
attention in fulfilling their desires and enjoying life. There is not reliable information about
level of Indulgence of Qatar.
Choice of Country
Following are the reasons for choosing Qatar and Lebanon for market expansion of Jordan
based pharmaceutical company.
1. The process of launching business in Qatar is streamlined (Heritage, 2019). Therefore,
Jordan based company will not face difficulty in setting business in Qatar.
2. The corporate tax rate is only 10%. It will help the company in saving cost incurred in
tax payment. This will ultimately result in higher profit.
3. The Per Capita Income of Qatar is $124,529. The high PCI states that people have
high disposable income and strong purchasing power. Additionally, a very low
unemployment rate states that people are employed and they attain financial resources
(Heritage, 2019). Therefore, the company will not face issue in selling its product at
high price.
4. The health status of Qatar population is low. They are facing problems related to
overweight, inactive, lack of vitamin D and diabetes (Khatri, 2017). It will assist the
Jordan based pharmaceutical company to gain high customer strength.
5. It is world’s safest country based on natural disaster (Nricafe, 2019). Therefore,
pharmaceutical company will face low threat of natural disaster.
6. Lebanon is chosen because it acts as a leading market for imported pharmaceutical
products (Export, 2019).
7. In Lebanon, the pharmaceutical industry annual growth is 5% (Export, 2019). This
states that Jordan based company has high possibility of earning fine financial returns.

INTERNATIONAL MARKET ANALYSIS 7
8. Lebanon employee show positive behaviour towards unknown and uncertain
situations (Hofstedeinsight, 2019). The key reason behind such behaviour is presence
of intermediate degree of uncertainty avoidance. It will assist the company in seeking
employee support and contribution in ambiguous situations as well.
9. Low long term orientation in Lebanon is best suitable for the company. Due to low
long term orientation, employee show high engagement towards their present work
and duties in the organization. It will assist the company in gaining quality
performance from Lebanon employees.
10. Low indulgence will prove suitable for the company. It suggests that Lebanon
employees will show their attention in their work. This is because they are less
diverted towards fulfilling their aims and enjoying life (Hofstedeinsight, 2019). This
will result to better employee performance.
Market Entry strategies
Licensing: In this method, the Company avail permission from another company of host
country to use its intellectual property for a period. It allows moving into several markets at
single time (Hyatt, 2016). It also has its own cons. It provides less control and licensee can
also become competitor.
Direct export: It involves selling products directly to the host country. The companies
entering through this strategy relies on agents. These agents belong to the host country. They
assist the company in representing their products and services in the host country. They are
considered as the face of the company. It minimizes the risk associated with overseas market
However, the company lacks in gaining accurate information about the market conditions of
the host country (Glowik, 2016).
Franchising: This market entry strategy involves two parries named Franchisor and
Franchisee. The franchisee uses franchisor’s trademark to successfully sell its products in the
host country. It does not involve the use of market testing (Laufs & Schwens, 2014). This is
because product and services are already proved in the market. It offers low risk of business
failure. However, it is a costly investment as franchisee has to pay large sum of money to
grant permission to use franchisor’s trademark. A franchisee has to highly adhere to the
conditions of the franchisor (Majchrzak, 2016).

INTERNATIONAL MARKET ANALYSIS 8
Joint venture: This entry strategy involves collaboration of two or more organizations to
share business loss and profits. The new entity is referred as ‘joint venture’. Through this
strategy, business enterprise will able to gain high access to better resources, and technology.
Different cultures of organizations (engaged in joint venture) leads to poor and
mismanagement. Therefore, it acts as weakness of joint venture (Steilmann, 2017).
Appropriate market entry strategy
A business organization should develop the use of suitable market entry strategy to enter in a
new international market. As per the analysis and understanding, the company should
develop the use of Joint Venture to enter in Qatar and Lebanon. This is because it will
provide adequate benefits to the company.
Implication
Availing the use of Joint Venture Market entry strategy will allow the Jordan based company
to have better access to resources. It will assist the company to emerge as a large business
enterprise from being medium business enterprise. This strategy will allow the company to
seek support from other companies from Qatar and Lebanon. It will also help in gaining the
trust of Lebanon customers. This will solve the concern of low trust among Lebanon
customers for sellers. Moreover, it will help the company in gaining better knowledge about
customers and market of Qatar and Lebanon. By developing better knowledge about the
customers and market, the Jordan based company will be able to serve its customers in best
possible manner.
First entrance
The Jordan based company should enter first in Qatar. This is because it has low corporate
tax, low unemployment and inflation rate. Additionally, it provides high population strength,
and low risk from natural calamities. It ranks better than Lebanon in terms of technology and
innovation. It is easy to set up business in Qatar. Therefore, the company should first opt for
Qatar as it provides more favourable business environment.
Conclusion
The discussion summarizes the international market analysis for Jordan based pharmaceutical
company. It is analyzed that it is significant for business organizations emphasizing on
business expansion in global market. It is acknowledged that Qatar provides favourable and

INTERNATIONAL MARKET ANALYSIS 9
Lebanon provides passable business environment to the Jordan based company. Based on
competitor analysis, it is evaluated that company will experience opportunity based on low
customers and suppliers power. It will face low threat of new entrant and it acts a chance for
the company. From the Hofstede analysis, it is assessed that both the countries show different
ranking on cultural dimensions. From the detailed evaluation of market entry strategies, it is
realized that joint venture is suitable strategy. Thus, the discussion concludes that
Pharmaceutical Company of Jordan should initiate its business operations firstly in Qatar.
Hence, Qatar proves to be more suitable market for market expansion via Joint Venture
strategy.

INTERNATIONAL MARKET ANALYSIS 10
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