Toyota's Global Strategy: Analyzing Australia and Pakistan Markets

This report analyzes Toyota's international business activities in Australia and Pakistan, focusing on the cultural and economic factors influencing market strategies. It evaluates the market conditions in both countries, highlighting the national differences and the need for tailored policies. The CAGE framework is applied to understand cultural, administrative, geographical, and economic distances, impacting Toyota's market position and sales. The report emphasizes the importance of adapting to local cultures and economic conditions to maintain competitiveness and enhance market share in diverse international markets. Desklib provides this and many other solved assignments for students.

Executive Summary
The international business activities of the organization would include execution of the business
and operational activities beyond the domestic boundaries in order to ensure that they expand
their activities in different countries to enhance their sales revenue and profitability. The
organization needs to ensure that they execute and understand the internal and external business
environment before beginning their operational activities in different countries. Toyota is one of
the largest car and different automobile producing company competing with Nissan and Honda
in the international market. The market conditions in Australia and Pakistan are completely
different which require proper analysis and development of different policies and procedures in
order to expand the operational and business activities in those respective markets. This report
would evaluate and analyze the market conditions in Australia and Pakistan which led to
development and implementation of different market policies and strategies in order to expand
the sales and business activities in those respective countries. We would evaluate the influence of
the national culture leading to national differences which led Toyota to set different policies in
order to retain their market share, position and enhance their sales and market activities in an
effective manner in those countries.
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Introduction
The organizations operating on the international level in different geographical locations beyond
the domestic market need to reframe their business policies and sales strategies as per the culture
and economic conditions influencing the market. There are lots of changes in the products and
services provided to the customers based on the taste preferences, likes and dislikes, cultural and
social differences, and economic conditions in the country. The Toyota Motor Corporations is
operating in the Australian and Pakistan economy wherein they maintain their position as largest
supplier and seller of different car and truck models. The economic conditions in both the
countries are analyzed and evaluated which support in the improvement in the sales and business
activities. The changing market conditions and improving trends in the competitive environment
has provided immense opportunities to enhance their business and operational activities in
different international countries so that they could explore new market and improve their sales
revenue and profitability to the new extent. The Toyota Motor Corporation has established their
plant in Altona, Australia and currently produces the Toyota Camry Hybrid model which can be
run on electricity and gas. The organizations like Toyota Motor Corporations need to ensure that
they are well-equipped and extensive research is conducted about the market conditions before
they make their decisions about entering the new markets. There would be changes in the
complete marketing mix of the market based on the PESTLE analysis so that the organization
could attract new target audience and penetrate the markets to increase their potential customer
base. There would be changes in the product, prices, promotional and advertising strategies along
with the place mix of the market for the products. The Toyota Motor Corporations would ensure
that the cultural influence on the sales and business activities of the organization is minimized
with new strategies that would be different from the traditional strategies implemented in
different countries. (Breslin, 2010).
Implementation of Prof. Ghemawat's CAGE Framework in the Australian
and Pakistan Economy
The CAGE framework included the cultural, administrative, geographical and Economic
differences that would be responsible for the implementation of different policies and strategies
in different economic countries. The organization needs to ensure that they understand the
implementation of the CAGE framework in order to analyze and implement the national culture
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influencing the Toyota Motor Corporation policies based on the national differences between
Australia and Pakistan so that they could capture the maximum market share and retain their
position in the market for the longest time. There are lots of differences in the culture and social
life of the people residing in both the countries which require different marketing and
promotional strategies. The CAGE framework would be very supportive in understanding the
attitude of the organization while they make their strategic decisions of expanding their business
activities in new countries. The cultural distances mentioned in the CAGE framework would
discuss about the differences in the languages spoken, differences in the ethnicity of the people
living in the country, social network of the people, differences in the religion followed in the
country, possibility of lack of trust in foreign products and services, and differences in the norms,
values, beliefs and ideologies of the people. The Toyota Motor Corporations would focus on the
cultural differences in Australia and Pakistan which are democratic countries and have accepted
globalization as the part of their development process. There are plants and factories established
in both the countries in order to execute their operational activities and assemble all the essential
equipment and spare parts of the car models. (Czinkota, 2012).
The administrative differences would be related to the differences in the currencies and their
respective values in international markets, political pressure due to stability issues, lack of proper
coordination in the import and export activities due to improper relations with the neighboring
countries, and lack of proper relationships with other countries. The administrative differences
would arise from the political issues since there would be imposing of different taxes and
unsupportive nature of the parties for executing the business and operational activities in the
country. The geographical differences would be related to the long distances between the rural
and urban populations, insecurity about the borders, differences, and variations in the time zones
in different locations in the country, and differences in the climatic and environmental behavior
in the country. These variations would be hampering the productivity and performance of the
Toyota Motor Corporation’s operational and sales activities resulting in the decline in the total
sales revenue and profitability of the organization. There would be lack of proper navigations
facilities and the remoteness of the rural populations and distances in the factory and market
would lead to additional costing of the logistics and transportation costs of the organization.
There would be lack of proper transportation facilities and unavailability of proper roads and
railways for transportation purpose within the country. The economic differences relate to the
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variations in the income capacity of the people, they are per capita income, their spending
capacity, and the economic conditions in the country related to the inflation in the economy, the
rising prices, and the fluctuations in the foreign exchange in the country. The Toyota Motors
Corporation needs to ensure that the cultural differences and national differences are evaluated
and ensured to develop their marketing, promotional and advertising strategies on the basis of
these cultural and national differences so that they could make maximum utilization of the
resources and cater to the customers with adequate product mix based on their needs and
requirements. (Chhokar, 2012).
The establishment of globalization has made it mandatory for organizations like Toyota to
ensure that they understand the attitude and national differences of the customers in the
respective countries and price their products and focus on the reduction of the total costs of the
production to match to the adequate pricing strategies in the country. Australia is a well-
developed country with an open attitude of the people wherein the purchasing power of the
people is much higher than that of Pakistan which is still a developing country. There are
differences in the attitude of the people in Pakistan and Australia along with the language
wherein Australia is an English country and Pakistan is an Islamic country. There are differences
in the economic conditions in the two mentioned countries which lead to variations in the
products and prices introduced in the market for people for purchasing and consumption. For
instance, the Toyota Motor Corporation has the different range of cars and trucks introduced in
the Pakistan and Australian market for the customers. The numbers of international players
operating in the two mentioned countries are also different which leads to differences in the level
of competition in the markets. (Hill, 2011).
The inflation rate in Australia is much cheaper than that of Pakistan resulting in more disposable
income with the customers and ability to spend on luxurious products in an efficient manner.
There are variations in the technological aspects of the two mentioned countries resulting in
unavailability of the spare parts and essential parts of the automobiles in an easy manner. There
are lots of restrictions by the government in Pakistan which hampers the ability of the
multinational organizations to rely on the domestic suppliers and production of those parts
internally within the country. The situation is completely different in Australia wherein the
technological development and adaptation are higher and there are plants established by the
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international players for production of the spare parts to be made available to the customers in a
timely manner. (Griffin, 2010).
Conclusion
The cultural and national differences pose potential threats for the existence of the organizations
like Toyota in particular market conditions. The proper analysis of the cultural and national
differences should be evaluated and analyzed by the organizations in timely manner by the
organization so that they can make internal changes in the culture prevailing in their organization
in order to cope with the external changes and make sure they can survive for a long time and
retain their market position and market share in such competitive market environment.
References
Breslin, D. (2010). The EU and Asia within an evolving global order: what is Europe? Where is
Asia?. East Asia, 27(1), 1-13.
Czinkota, N. (2012). International marketing. Cengage Learning.
Chhokar, W, (2012). Culture and leadership across the world: The GLOBE book of in-depth
studies of 25 societies. Routledge.
Griffin, C. (2010). International business. Prentice Hall.
Hill, S. (2011). International business: Competing in the global marketplace.
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