Critical Analysis: Global Expansion of Saudi Steel Company

This report critically analyzes the global expansion of the Saudi Steel Company. It addresses key variables for selecting potential countries, outlines the steps a firm should take when going global, and discusses challenges faced during early expansion, such as cultural differences, marketing strategies, and organizational communication. The report also explores different market entry strategies, including direct exporting, licensing, and franchising. The analysis is supported by course materials, textbook references, and online resources, providing a comprehensive overview of the company's potential global ventures. The report aims to provide insights into international business, marketing, and strategic management.

Running head: GLOBAL EXPANSION OF SAUDI STEEL COMPANY
GLOBAL EXPANSION OF SAUDI STEEL COMPANY
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Author note

1GLOBAL EXPANSION OF SAUDI STEEL COMPANY
Answer 1:
When a company thinks of going global, there are certain variables that the company
needs to analyse in order to expand its business. The first variable is to analyse the demand in the
market. It is important for a company to set goals according to the demands of the market where
the company is going to extend its business. The second variable that the company needs to
consider is understanding the local regulations as well as the cultural preferences of the countries
where it is going to expand. The third variable is building a local network when entering the new
market. The company has to build a team of partners and distributors in the countries and
develop trust in order to flourish their business (Haider et al., 2017). The Saudi Telecom
Company has to study the countries preferences and make a thorough plan before expanding its
business globally.
Answer 2:
Before entering a global market, the companies should take the following four steps. The
first step is to develop a game plan and get to know the fastest growth in online markets. It is
important to build an online presence, as it is a low risk to analyse the new market. The second
step is to extend the reach of supply chain. The company needs to grow quickly and respond to
the needs and demand of the consumers. These should be done while reducing the risk and
lowering the fixed costs (Holmes Jr. et al., 2018). Saudi telecom Company should establish an
overseas partner wherein they would help them with overcoming the potential risks. The third
step is to leverage a business partner expertise. Customs duty, red tape, local bureaucracy are the
aspects that the company has to consider while moving forward. The last step is to use the
technologies for control and the visibility of stock. The Telecom Company should provide basic
customer services online to make the lives of the consumers easier.

2GLOBAL EXPANSION OF SAUDI STEEL COMPANY
Answer 3:
Three challenges in which the company can face problems in expansion are discussed
further. The unfamiliar culture of the country can pose a threat to the Saudi Company. Knowing
the ways in which the people interact in a social setting, their behaviours and different culture in
the new country can help their cause. Secondly, learning the marketing strategies in the country
of expansion in order to reach the customers is important. Learning the ways to reach the
prospective customers would help the business going global. The third challenge would be to
handle the organisational communication in the foreign country. The company has to set up a
base to manage the international expansion (McFarlin & Sweeney, 2014). The telecomm
company has to analyse these bases.
Answer 4:
There are a variety of ways to enter a foreign market. However, the three main categories
are direct exporting, licensing and franchising. Direct exporting refers to the direct selling of the
resources in the chosen country. Once established, many companies have their agents and
distributors handle the business. Licensing is the transferring of rights to use the products and
services of the firm in the country of expansion. Lastly, franchising is building a chain of
business models to expand in the chosen market (Hoffman, Munemo & Watson, 2016). Saudi
Telecom Company should use such strategies to go global.

3GLOBAL EXPANSION OF SAUDI STEEL COMPANY
References
Haider, A. A., Zafar, A., Khalid, A., Majid, A., Abdullah, M. A., & Sarwar, M. B. (2017).
Marketing Management. Head, B, 22.
Hoffman, R. C., Munemo, J., & Watson, S. (2016). International franchise expansion: the role of
institutions and transaction costs. Journal of International Management, 22(2), 101-114.
Holmes Jr, R. M., Hoskisson, R. E., Kim, H., Wan, W. P., & Holcomb, T. R. (2018).
International strategy and business groups: A review and future research agenda. Journal
of World Business, 53(2), 134-150.
McFarlin, D., & Sweeney, P. D. (2014). International management: strategic opportunities &
cultural challenges. Routledge.