International Business: Wilko's Market Entry Strategy & Expansion Plan

This report provides a comprehensive analysis of Wilko's international business expansion strategy, focusing on the rationale for going international, a recommendation for expanding into the Indian market, potential barriers to international expansion, and relevant internationalization approaches. The report highlights the opportunities in the Indian market, including its growing economy, technological advancements, and skilled workforce. It also discusses various strategies for internationalization, such as multi-domestic, global, and transnational strategies, as well as export-based, non-equity-based, and equity-based methods. The report concludes with recommendations for Wilko to successfully navigate the challenges and capitalize on the opportunities in the international market. Desklib provides access to similar solved assignments and study resources for students.

International business

Executive Summary
The scope of international business is more significant which combines transactions of
goods and services at global level. The aim of this report is to provide rationale for going
international along with recommendations to expand international trade. Hence company
experience various barrier while expanding its international business but it try to overcome by
adopting suitable approach of international process.

Table of Contents
Executive Summary.........................................................................................................................2
INTRODUCTION...........................................................................................................................4
TASK...............................................................................................................................................4
Overview of company and rationale for going international..................................................4
Recommendation of country and rationale for going international trade..............................6
Barriers that company faced in international business expansion..........................................7
Relevant approach of international process for specified target market..............................10
Recommendations................................................................................................................11
CONCLUSION..............................................................................................................................11
REFERENCES..............................................................................................................................14

INTRODUCTION
The international business is known as trade of products and services, technology,
knowledge, capital around the globe which refers as national borders. In general, international
business is called as global business operations which involve transaction of products and
services among two and more countries. The production and distribution of products and services
are taking place across boundary of country (Plastun and et. al., 2020). This type of business
generate more golden opportunity (enhance customer base) but also consist of several
challenges (culture barrier) while going at international business operations. There is great scope
has been seen for going from domestic to international market as it build more employment
opportunity and raise the economy of the country. The chosen organisation for this report is
Wilko that deals in retail chain of home wares and household items, founded in 1930 by James
Kemsey Wilkinson. The company operates its business in domestic part of UK and planning for
its international business expansion. The report highlight overview of Wilko company and its
rationale for going internationally. It also include some useful recommendation for going
international trade. The report combines of typical barrier that company face towards
international business expansion. It consist of relevant approach of international process for
specified target market.
TASK
Overview of company and rationale for going international
The Wilko LTD operates its domestic business in parts of UK that provide services and
products of home wares and household items. The company is founded by James Kemsey
Wilkinson in 1930. The company is based as first own label brand that contains 14000 products
in the domestic market. The company generate revenue approx 1.283 million due to its strong
brand connection and loyal customer base in domestic market (D’Angelo, Ganotakis and Love,
2020). As company is running successfully in parts of UK, so they are planning for going
international market. Company want to utilise its revenue level into better way to improve its
brand name in international market. This will provide them opportunity to grow business
expansion. This will enhance customer base and improve company profitability is they
successfully manage barriers that may impact their business performance at international market.
When company is planning of international business, then they have to develop long term plans

for stability in international market. Through this they can expand their market and sales of
company. There are some rationale which Wilko company must consider for going internal
market.
 Increase revenue potential- Wilko company gets exhausted with their growth
opportunity at domestic market, then it has great scope for company towards the
international business expansion as it will generate more opportunity to develop their
business. This will provide them chance to explore the market of international to acquire
million of customer in order to raise sales and revenue.
 Enter in exclusive market- As Wilko become more successful in domestic market then
going towards new market will expand their market overseas. But before going into
international trade company need to perform research of new market in which they are
planning for international trade (El-Helaly, Ntim and Soliman, 2020).
 New customer base- Another reason for going international, is that it will provide golden
opportunity for expansing new market customer base by introducing qualitative range of
products to the potential new customer. This will increase sale of company with help of
new loyal customer base.
 Expansion allows to diversity- If company only operates in domestic or local country
then it will limit organisational profits. They can not explore new opportunity of market
change if they does not plan of international business. While executing international
business company take opportunity of market diversity and maintain more stability in
revenue.
 Competitive advantage- International market provide opportunity to getting out from
saturated market, this will give them effective access of loyal new customer where
competitors is not operating yet (Berrone and et. al., 2020).
 Improve company reputation- The business expansion aid company to improve its
overall brand name as company can capable enough to deliver more reliable services to
target international customer. This will ensure strong effective global reputation so that
they can attract their new customer base. The international market will established brand
recognition as well as maintain international credibility of brand.
 Cost saving- Expansion of international market will enhance ability of business in order
to reduce its operational cost to save company money. This is one of the greater

advantage through which company operates its business market into cheaper labour cost
so that they deliver their services at more affordable rate.
Recommendation of country and rationale for going international trade
In context of Wilko company, the recommend country is ASIA for international business
expansion. Asia country like India is a perfect untapped market place where company can
expand its market with maximum opportunity of business growth. Indian market provide them
golden opportunity for international expansion as here they get highly skilled labour at very low
cost. The political environment also very regularity friendly for business practices (Ruel,
Rowlands and Njoku, 2020). That is why for Wilko India become favourite destination to
develop long lasting business success. In below there are some reason that make Indian market
more perfect for Wilko international business.
 Market opportunity- The India is full of potential customer possibility which cover
biggest market share around the world. India is most fast growing economic country over
the last years. This will ensure maximum opportunity for higher growth opportunity
towards international business. The government of India is planning to develop more
trillion kind of economy. There is high growth opportunity has been seen in Indian
market that Wilko company can take maximum opportunity. The per capita development
of customer has been seen that increase customer purchasing power. This will benefit the
company in increasing their profitability and revenue.
 Growing technology- The technology is being growing in the Indian market which
generate potential opportunity to attract more loyal customer base. The technology
advancement has been seen regarding e-commerce, ed- tech and so on. The company can
grab the opportunity of technology in raise sales of company.
 Human capital- The Indian market is a great hub of trained workforce that deliver high
qualitative services at very low cost. That is why Wilko can utilise manpower of Indian
market that support growth of company at very low cost and easily introduced innovative
creative quality in emerging market of India.
 Open regulatory- The Indian market is more open for other countries in order to execute
international trade (Alon and et. al., 2020). Here more accessibility has been provided to
the foreign start-up along with various benefits like tax benefits. Indian government is

planning to improve its business economy and want to attract huge investment in FDI. So
the Indian market are the best market for international growth of Wilko.
The various opportunities is being offered by international market of India that consider it
as dream destination for starting business practices. There is no shortcut method for developing
business, it take some times to understand market and target customer preferences. Wilko need to
develop empathy regarding Indian culture so that they can easily build trust of potential indian
customer.
Barriers that company faced in international business expansion
For internationalising the business, organisations makes use of appropriate strategies and
approaches as per the company's mission, vision and objectives (Guimarães and Finardi, 2021).
In order to expand the business operations into Asian country, Wilko can make use of numerous
approaches and strategies which are as follows:
Strategies for the internationalisation of Wilko:
Multi-domestic strategy: As the name suggests, multi-domestic strategy, used by the
companies for the process of internationalisation, is an international marketing approach where
business firms advertise and commercialise their products and services to the needs local market
withing each of the global markets rather than taking a universal approach. With the help of this
approach, Wilko will tailor its products as per the culture and demographics of local market in
the international country rather than making it holistic. The idea behind is to focus on the niche
target audience and test the product in international market on the basis of adaptability.
Global strategy: Here, with the help of this strategy business firms sacrifices the
responsiveness of local needs and wants within each of its global market in pursuit of efficiency.
It is just opposite of what we discussed earlier which was sacrificing efficiency in pursuit of local
requirements (Wolniak, 2020). Wilko can target entirely global market and offer its same range
of products and services in each of the global market. Wilko here make use of push marketing
strategy where same products and services are offered to the different geographical market
irrespective of the distinct taste and preference.
Transnational strategy: It is the another internationalisation strategy which is aimed to
seek a perfect balance between global and multi-domestic strategy. Wilko with this approach can
maximise its efficiency by offering products and services as per the local preferences globally in

each of its markets. Some of the example of the few MNC's who opted for such approach are Mc
Donald's and KFC.
Ways of internationalisation that can be opted by Wilko are:
Export based approach: One of the traditional and most commonly used approach for
the process of internationalisation is producing the goods and services in local market and
achieves economies of scale by exporting proportion of produced good and services to foreign
market (Liñán, Paul and Fayolle, 2020). While expanding its business in India, Wilko can opt for
such methods as India's economic conditions are significantly attractive for the exporters as
government has low import duty for the local firms that in turn makes it easier for the companies
to attract foreign exports. Exporting can be done directly or indirectly and having considered
attractiveness of Indian market , Wilko can opt for a direct exporting.
Non-equity based methods: It is the modern form on internationalisation where business
firms expands its areas of operation either by selling technology or conducting business activities
on the basis of contracts involving intellectual properties of the business. Licensing is one of the
best way through which Wilko can grant a license to the foreign party in order to make use of its
operational activities and production methods. With the help of such contracts Wilko (licensor)
gets benefit of the licensee's local knowledge of the target market and its loyal customer base
(Durrer, 2020).
Another method for internationalisation is franchising where foreign purchaser of a franchisee
gets right to undertake the business activities under the brand name or trademark of Wilko. This
approach is widely used by the business firms while expanding its business operations globally
as this approach is helps in establishing the business unit in foreign with little investment and
also helps in increasing the brand image and brand recognition.
Equity based method: This method is concerned with the physically investment made by
the company in order to make expansion globally. However, this method requires a lots of
investment in order to make a foreign direct investment. Acquisition and merger is one of the
significant approaches which allows companies to acquire a small and medium enterprise which
has a huge customer base and potential to grow. Furthermore, another method for the process of
internationalisation is joint venture which is related with creating a new identity by forming an
alliance between two competitive firms (David and Hill, 2020).

International business is defined as the process in which business provides products and services
across the border. It facilitates organisation to reach new potential clients that boost
organisational profitability ratio as well as provides expansion opportunities. There are various
challenges and barriers are faced by the organisation to conduct business functions at global
level. There are some guidelines are developed by the government, so respective organisation
should considered them before leaping in international business operations. Some barriers are
mentioned below:
Laws and regulations- As every organisation maintains their laws and regulations that
are different from each other that creates difficulty for organisation to run business operations
internationally. Wilko organisation conducts it operations in UK and planning for expanding
business functions in other countries as well. Respective organisation gain comprehensive
understanding another country laws and regulations for the purpose of running business activities
efficiently. In government laws regular changes are happened that impacts business functions. In
international business various tariff, taxation laws, navigating legal requirements and trading
regulations that are compile by organisation to run business efficiently. These laws properly
examined by organisation before taking the decision to enter in international market.
International accounting- For every business who wants to start their business in
different countries have to face the difficulty of international accounting. It is because the
accounting which the company is doing in their own country is different which they have to do
in the another country(Zargar and Kumar, 2019). Wilko wants to make the expansion of the
business and for that they have to learn the legal areas in accounting so that they would be able
to fulfil the taxation rules and regulations. If the accounting rules and regulations are not learned
by the company then they might not be able to make some benefits.
Cultural differences- The other barrier which the company has to face while making the
expansion of the business is the cultural differences which impacts mostly on employees. Wilko
is a UK based company and now wants to make the expansion in India in which the owner and
the management of the company might have to face the challenge in different culture(He and
Kyaw, 2018). It is very easy and simple to run the business in own county but on the other side it
becomes very difficult to manage the teams in another country and to work with different clients
of the other country. Wilko has to work on the culture of India to make proper bonding and to
work with the culture of the country.

Political risks- The other barrier and difficulty which the company has to face is that of
political instability. There are countries in which the government frames difficult rules and
regulations which makes it very difficult for the business to conduct their operations and this
always happens when the government of the country is unstable. Unstable policies, interest rates
and regulations can act as the most damaging source for the business. But on the other side
Wilko is not making any decisions which includes the unstable government and its policies.
Language barriers- Language barrier means the problems which is faced by the people
who are making the expansion in the business. Language barrier comes up when the company of
different country wants to make the expansion of the business in other country(Sanyal and
Samanta, 2019). Language is the main issue which the employees of the company have to face
because when Wilko will make the expansion of the business in India the employees of both the
countries at a point of time will have conduct meeting which needs to be in a mutual language.
This means it needs to be understood by both the country employees to make the communication
smooth and so that the objectives of the company can be met.
Currency rates- The currency rate is the major problem which keeps on fluctuating and
to monitor the exchange rates is a very important international business strategy. But it is
actually very difficult to make the forecasting of profit because of dynamic global economy.
Wilko has made the decision of expanding the business in country India whose price rates keeps
on fluctuating.
Relevant approach of international process for specified target market
As per the above information and analysis of market potential for the Wilko it has been
analysed that there is numerous opportunities available in Asian country like India for Wilko to
expand globally. There are numerous approaches and strategies that are essential for the
implementation of process of internationalisation which could be opted by Wilko when going
global. For Wilko the best suitable approach and strategy for expanding its business operations
are franchising under non equity based approach and globally strategy for the commercialisation
of products and services. With the franchising, company can establish its business operations in
the foreign market quickly and effectively at low investment amount. Under franchising, Wilko
can get the insights of the local knowledge with regards to the target market and audience. India,
being a culturally diversified country has a different demographics of target audience which in
turn is difficult for Wilko to get a deep insight of the market and its prevailing trends. With the

help of franchising Wilko can establish its presence physically in the local Indian market and
capture a large target audience (Orkodashvili, 2021).
Additionally, global strategies for the Indian market will be a suitable strategy as this will
allow the business firm in achieving economies of scale by optimising its efficiency in target
market. However, use of franchising can also lead to the creation of new competitor in foreign
market as once the licensee gets insight of the business operation they strive to compete the same
company by offering innovative products and services. On the other hand, global strategy for
marketing and commercialisation of the company; offering might not generate desired outcomes
as taste and preference of Indian target audience varies region to region which can be a
challenging task for Wilko to deal with and can affect its adaptability rate. Therefore, it is
recommended for the business firm Wilko, that before expanding into Asian market it is
imperative to conduct detailed and extensive market research and analysis of economic
conditions of a target market.
Recommendations
The Wilko company is expanding its international business in the Indian international
market for earning more profitability. Recommendations to improve their understanding
regarding international trade are as follows-
 Develop appropriate technological resources is most important for Wilko company
because this will help them to communicate and collaborate with domestic partners. The
technology will help in tracking shipment of goods and services.
 Being more active in building in appropriate strategies within local experts will help
Wilko to develop more potential opportunity in build strong brand reputation at Indian
market with help of local experts.
CONCLUSION
From the above report, it has been concluded that international business provide potential
opportunity to expand profitability and customer base of company. The international buisness
provide scope to expand market share and revenue level. Before going international company
must evaluate feasibility check of rationale reason for going international because this will

provide more sustainability to the international business practice of company. The typical
barriers (communication, regulatory) impact sustainability of company in long run. Company
need to overcome these barriers with help of effective planning of international business policies.
There are several approach of international process which help company to expand its specified
business market. While choosing appropriate approach of international process company must
evaluate its pros and cons.

REFERENCES
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