BMA5108: Sainsbury's Business Plan for India Market Expansion

This project details a business plan for Sainsbury's, a UK-based retailer, to expand its operations into the Indian market. The plan includes an analysis of the Indian market using PESTLE, entry strategies focusing on franchising, marketing strategies including traditional and digital methods, and operational considerations. The project emphasizes adapting to local customs and laws, targeting metropolitan cities initially, and offering vegetarian and non-vegetarian food options compliant with Indian cultural norms. The ultimate goal is to leverage India's growing purchasing power and contribute to the GDP of both nations while establishing a strong brand presence.

International business

Table of Contents
INTRODUCTION...........................................................................................................................1
MAIN BODY...................................................................................................................................2
CONCLUSION................................................................................................................................8
REFERENCES................................................................................................................................9

INTRODUCTION
International business is refers to the exchange of services and products between two different
countries. It involves cross border transaction of goods and services between two countries. The
successful business acknowledge the variety of the world marketplace and are able to make out
with the quality and risk of doing business in a constantly changing global market. It enhances
their standard of living and increase their exposure to new ideas, devices, products, services and
technologies. Internationalisation justifies that produce the product in a way that it may be liked
and consumed across many countries(Aagaard, Aagaard and Harrison, 2019). This technique is
used by companies who are willing to expand their business beyond their own domestic market
understanding consumers because different countries have different taste or habits. This is the
process of increasing involvement of company in international market. In this process while
expanding a business nothing matters that what the position of company previously. They wish
to expand their share market in global reach, it often requires add products to adapt the technical
or cultural needs of a given nation. The report is based on sainsbury's which is UK based
company. It was founded in 1869 in London by John James sainsbury. The company is listed on
the London stock market. It is a retail industry deals in Hypermarket, supermarket and shops etc.
the company wants to expand its market in India in order to expansion of its market in starting
their target market will be metropolitan cities of country as per the country tradition . The India
is full of tradition and festive faiths as it is developing country it has vast number of population.
The most amount of population are follower of traditional values and they believe in moral
values, the people believes in tradition and god too much as in nation lots of festivals are
celebrated by different religions. On this basis the company some up with the vegetarian packed
foods and non veg that are allowed in country like meat, fish, etc. the company should target first
metro cities which can afford the cost of goods and they should come with product which are
eatable in nation like dry fruits, vegetables and packed foods, chocolates which are reasonable in
cost as most of people are belongs to medium class or lower class. The company should come
up with an innovative idea which can touch the heart of public and full knowledge of the laws
and policies which can effect the business while launching. The basic reason of expanding
market is rising the purchasing power in target market. The expansion of business contributes for
both country as increase in nation GDP of both the nations. This report will cover the business
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development strategies further will explain that how this study is useful for me and how it will
be assist in future.
MAIN BODY
As of business got a good brand image in market. The company thinks to expand its market in
new platform whether its in the market or out of the country with the view of earning profit and
good brand image in new market(Braunerhjelm and Halldin,2019). It involve various activities
that assist in developing the business which are listed below.
Pestle Analysis
It is a framework that analyse the external factor which effect on the operations of business. It
consist a six factors which are describe below.
Political factor – these factor include political issues, tax policies etc. sainsbury is the second
largest super market in UK. The company is not affected by the economic slowdown as
it mainly operates in UK. But since UK has exit from European union, it gives slightly
difference in business.
Economic factor- these factor include inflation rate, economic growth rates and interest rates
etc. In context of sainsbury, investing in countries economy can be good option for firm
as they have to observe that countries with more economic freedom, it have more
avenues for growth.
Social factors- these factor consider health consciousness, cultural aspects and age
distribution. in relation of sainsbury, company provides the consumer a level of
satisfaction of saving few bucks. In super market, user buy more than the need.
Technological factors – these factors include Research and development technology and many
more. in case of sainsbury, the company provides the latest technology. It has come up
with the opinion of selling online food products.
Environmental factors- it is concern with ecological impacts such as temperature etc. in case of
siansbury, the company supports the U.N sustainability objectives and workings
towards it. Also it is working to reduce its carbon emissions in operations.
Legal factors – it consider a factors like laws and regulations etc. in case of sainsbury, the new
tax has introduced in UK, that was sugar tax, but company has deny to pay that taxes
and they want to save some money.
Entry strategies -
Before approaching the international market the person should analyse the market and the
competitor present in market place in order to determine that the business can sustain in this
market place or not , by analysing all this condition the person should introduce venture. This
strategy justifies the risk involved in the market, while launching the business it include the risk
and investment and opportunities with itself the basic variants of this processor are listed below.
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 Exporting- It means sending the goods and services to the other country for a purpose of
selling. It is low risky method that firm find attractive for many reasons like new
opportunity overseas and it is less risky etc. small firms often choose the exporting over
other methods because it gives control over risk, cost and resources commitment. In
extent of Sainsbury the firm export their products to other nation by the purpose of
reaching out to the new market or introducing their products in the market(Donthu,
Kumar and Pattnaik, 2020). They focuses to be preference in the taste of consumers.
 Licensing/Franchising- This agreement, provides a product to a international company
granting that license to the individual to use the brand name, patents or sales knowledge
in return of payment. It have a competitive advantage with agreement whereas the
licensor obtains cheap access to a new market. It is typically least profitable method for
entering in foreign market. In case of sainsbury the company feels easy for providing
license to the other person in the exchange of money, they provide the control on share
market or operations of the company to that person in short the firm permit person to
work by using their name.
 Joint venture- It is a partnership between domestic market and foreign market company.
Both partners invest money, control shares of the equity. Basically while entering in
international market the partner need a proper guidance of market, connections and
networks access to the other nation(Doz,Prahalad and Hamel, 2017). These kind of firms
may get a advantages of taxes and many more. Sometimes sainsbury follows joint
venture in case where the legal practices are obstacles for them to work in that nation.
The industry only focuses on to expand their business across worldwide so they choose
options as per laws and policies.
 Direct investment- The big companies chooses to work in large scale production and
marketing internationally by investing directly in fully control manufacturing or
marketing ancillary offshore. This able company to work aggressively internationally.
This processor required a huge amount of capital to invest. It also include risk with it, it
required a full knowledge of business condition and customs in a foreign market. In case
of sainsbury, the company invest good amount of money to expand their business in
international market to own the business in their hands, the company always tries to
operate the fir by their operational methods by following trade practices.
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 Trade intermediaries- This states if a company less the resources or expertise to enter in
an international market, it can hire trade mediator(Expositoand Sanchis lopis, 2018).
Who processes the important contacts and relationship in the market. These individuals
typically purchases a UK goods at a reasonable rate at a best discount and then sell in
other markets. The sainsbury company initiate this method while expanding business
other countries to introduce their firm in market with proper legal entity and appropriate
firm practices.
Thus, the sainsbury adopt Franchising techniques to expand their business in India market as it
has low risk factor for business. It gives employment opportunity to the nations by adopting this
method this gives direct benefit to company by increasing profit and sales factors for company.
The company adopt franchising in India at Mumbai in order to expand their business. The
company adapts a ansoff model for conducting a business activity. Ansoff matrix is a framework
that enables to identify growth opportunity for the organisation to grow in long term. It helps
executive, senior manager and marketers to build a strategy for the future growth. It consist a
four parts that are market development, ,market penetration, product development and
diversification. Out of four segments the company follows a market development strategy as the
company majorly works in UK.
Marketing strategies
It is method of business to reach to the target customers and market. It contains a firms value
proposition, key brand messaging, data on target customer demographics(Foss and Pedersen,
2019). The types of marketing strategies are describe below.
 Traditional marketing- It is an approach in which marketers identify their audience and
place ads where their audience will see, hear or interact with customers. It include print
ads, posters, billboards or advertisement. It is based on push marketing and it motive is o
sell the product and earn a profit. The sainsbury follows this technique to promote their
business and product through these methods like promoting the business through posters
or advertisement.
 Digital Marketing- It is set of marketing through social media platform to reach and
inform the target customers to attain a business goals. This method is successfully applied
by every kind of organisation to promote the business offer or introducing new product
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and launching a new business in UK market. It include sites like facebook, twitter,
Instagram and other apps(Gereffi, G., 2019). The saninsbury company adapts this
techniques to socialise their business and promote their offers and new products in target
market or informing the customer for new arrivals.
 Mass marketing – It is like a shotgun approach for marketing. This technique gives a
insight of understanding that where to place media for their potential national customers
who buy their products and services. In case of sainsbury the firm should follow this
method to be in range of every class and level of public so that brand can recognize by
every one even across country.
 Relationship marketing- Most of companies focus on building relationship with their
customers instead of always exclusive trying to sell them something. This is effective for
business because the person who loves the brand will always contributes by sending
money in it. In case of sainsbury the company follows this method to create a loyal
customer base in the country so that they can influence others to use the product of
company.
 Evangelism marketing – This strategy involves the development of loyal customer fan
base, who follows brand what the situation is rather than moving to others. These kind of
customers represent the brand name like the brand is the part of themselves(Guillotin and
Mangematin, 2018). The sainsbury catches the good customer base to create the business
for future they provide a good and special offers for that kind of customers so that they
give reference to others.
 Outbound / Inbound marketing – This type of marketing involves the technique of
approaching customers via many sources or connecting a target customers. Outbound
marketing targets the group of people and specific group or class and inbound marketing
include within the business like references and contact.
Operations strategies
It is an feature of operations management that it is related with long term preparation for
business clients service and strategies. It focuses on the goals and aspiration of company as well
as the potential plans for getting the business their goals. It includes the location , size, type of
facilities, worker skills, talents required and use of automations or technology, special processes
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and quality control methods(Hartsfield, Johansen and Knight, 2017). It includes some basic
types which are describe below.
 Corporate strategy- This refers to the technique which guide its motive and goal. While
planning a strategy of working by involving organisation and its various department as
they are interlinked with each other. It can create broad policies and rules that allocate
resources of each department to help the company to achieve its objective. The sainsbury
build a polices or strategy to make a work systematic and productive. This helps in
running business smoothly.
 Product and service development strategy- It assist in improving and developing the
business through new techniques and innovations. It can adopt to add value in designing
the business with the requirements of down markets. In case of sainsbury, company can
give preferences to the speedy delivery of products, and multi outlets for consumers.
 Cost driven strategy- It can help an industry in adapting organisation strategy to
compete based on price. It is common in market where consumer are price conscious.
The sainsbury firm refers and produce quality products with cost controlling method for
users, they successfully implement this method to make the product more effective in
order to be in customers eyes and better than rivals.
 Flexibility strategy – company uses these strategies to allow to compete on the basis of
flexibility of their product and services(Jafari-Sadeghi, Kimiagari and Biancone, 2019).
In case of sainsbury, it emphasizes it power of change its goods quickly on the basis of
customer choice. Flexibility can also mean allowing to personalize to control on the
amount of assets on the basis of expected demand.
Human Resources strategies-
It is a method of hiring a workforce for company for attaining its organisation goals. It
include hiring, performance appraisal, development, and compensation etc. this individual is
selected by company for firm to recruit a employees as per the skills and qualities. It consist
some basic terms which are listed below.
 Staffing – it is the method of selecting people for organisation welfare and making work
productive and effective(Kaplan, 2018). It include the activity of identifying the skilled
man power, using various recruitment technology to acquire high mass of applicants,
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maintaining ethical practices of hiring and creating a working environment at workplace
etc. In context of Sainsbury, the company should hire the qualified and skilled employee
who gives benefit to company and growth in production level.
 Development – After staffing of employees the next level arises which include training
of new employees. It is the duty of Human resource executive to develop the skills of
employees time by time in order to develop the skills of members. It includes training and
preparing new employees for their role and job and provides feedbacks for employees so
that they can improve their performance constantly (Li, 2018). In case of sainsbury, the
firm should provide training sessions for employees accordingly so that they can adapt
the things fast and easily.
 safety and healthy – for attaining a best business activities it include consideration of
safety measures like appropriate polices for workers, health policies, job securities and
many more. It include implementing of health policies, informing safety and compliance
with employees etc. in case of sainsbury, the firm should offers and implement a policies
for welfare of workers and workforce moreover they should provide them a health related
policies so that they work stress free on other side they should provide policies within
the business to like job security for individuals so that they can work effectively and
productive.
 Employee and labour relation – This implies the employees rights and coordination
with team. It explains the coordination between labour and managers. It include the
claims of harassment and other workplace abuses, discussing the employee right with
labour and workforce. moreover it act as voice of workforce the mediator between labour
or top level executive(Lindner, Klein and Schmidt, 2018). In terms of saibsbury they
should communicate with workers time to time by various techniques and they should
implement some employee possession plans so that feel familiar with organisation.
 Compensation - it states that everyone is working for one basic reason that include
earning the living hood and improving the life style(Omane-Adjepong and Alagidede,
2019). This factor is based on role, performance and legal requirements. It include setting
compensation level to match the market by using standard, implementing negotiation
plan, health insurance rates, retirement plan, and other benefits. In case of sainsbury the
firm should introduce plans related to with in the company for employees like working
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stability plans, retirement plan or policies for their health by including their spouses with
them so that wish to work more productive and effectively.
Thus, the basic job of this department is to create a happy and healthy environment for
employees and making them feel secure fro the company side regarding job, designation of the
person.
Finance strategies
It is an approach for the planned development of the finance function on the basis of clear
vision and plan. It assist in designing an insight from business context, stakeholder expectations
and self performance and ability to convert opportunity as business value.
Number of units produced = 5000 units
Revenue = 5000 Units @ 500 per unit
Variable Cost = 300000
Fixed Cost = 200000
Particulars Amount (£)
Sales 2500000
Variable Costs 300000
Contribution 2200000
Less: Fixed Cost 200000
Net Profit 2000000
Contribution Margin per unit = 2200000 / 5000 = $440 per unit
Break – even Point (in sales) = Fixed Cost / Contribution = 200000 / 440 = £454.54
Balance Sheet
Particulars Amount (in 000’)
Non – current Assets
Plant and Machinery 9585
Intangible assets 745
10975
Current Assets
Inventories 965
Trade Receivables 845
Cash 2458
4268
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Total Assets 15243
Current Liabilities
Trade Payables 4785
Borrowings 845
Tax Payable 21
5651
Non – current liabilities
Borrowings 5478
Provisions 215
Other Payables 3
Deferred Financial Liability 93
Lease Liability 3258
9047
Total Liabilities 14698
Equity
Capital 545
Total Equity 545
Reflection-
The study of model make me understand of work ethics and behaviour of conducting. I am
thankful that my teacher, mentors and trainer who helped me in completing this model by
guiding me. I m thankful that I got chance of working on that model and all the knowledge I grab
from my assignment will be used in future. While studying this model I have improved my
learning skills and problem solving skills that are useful for me during working on this model. I
have faced some issues while working on this topic like the problem while researching and the
resources were less during assignment. After completing the task I got a feedback. Through
feedback I got a point for improving thing but on some point I disagree because according to my
study the points were not matching with my knowledge by discussing on that points me and
mentors come on conclusions that was satisfied for me, by feedback I have improved my
knowledge of working with other nation and rules and knowledge of laws and policies of
countries. I have learned the communication skills and found improvement in communicating
with others. Moreover I m thankful of my mentors that they being so helpful and cooperative
with me. The new things I have learn that IT techniques and knowledge of data collecting. I have
done this model by using my skills of critical things and innovative skills of doing things
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creatively and smartly. I feel pleased that the guidance I got is useful for future and professional
life. I will apply all my learning in future or upcoming life. I have learned about the process of
international business and expansion of business in international market. I have learned that for
introducing business in other market its not compulsory for brand that what the position of
business in present market, the business can be launched in different market with good brand
image. I have struggled while studying this topic by the team members point of views because
the team is of five members and every one has different point of view and critical thinking skills
so their was so much disagreement of points, but finally we came to a point where we all five
agreed and start working on that project. But It was fruitful experience working with mentors
and team it will be memorable for me. The most important thing I have earned during the
assessment is to be focused towards target and be patient.
In end, I have learned a lot during assignments and hope to consistency in learning new and
great things that will be useful for me in upcomi8ng years and I believe that I would be great
contributor in world economy and social or ethically too.
CONCLUSION
From the above report it is concluded that while expanding a business internationally the
administrate have to analyse the market conditions and the trade policies of the nation to expand
business in other countries and proper legal working and follow up of government policies.
These business could be any practice like, it can be franchise or sole business and may be
exporting although it need a systematic work and smoothing running as every country have
different laws. As the expansion of business contributes in earning profit and increasing GDP.
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