International Joint Venture: Zara and MetersBonwe in China

Desklib provides past papers and solved assignments for students. This project analyzes Zara and MetersBonwe's joint venture in China.

Managing a Successful Business Project
The risks and benefits of a joint business venture to enter international markets
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Executive Summary
The process of globalisation has affected trade and commerce all across the world. One of the
results of this process is the formation of cross-border joint ventures. These joint ventures are
formed in order to penetrate the foreign or international markets. The world has witnessed the
formation of these kinds of joint ventures between different companies in various countries.
These international joint ventures provide the partner organisations with various benefits, such as
sharing the incurred losses; however, there are various risks and threats connected to it as well.
This project has been carried out to assess the different advantages as well as the disadvantages
the Zara and MetersBonwe can face on the formation of an international joint venture in the
country of China.
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Table of Contents
Task 1...............................................................................................................................................4
Task 2.............................................................................................................................................12
Reference List................................................................................................................................28
Appendix........................................................................................................................................31
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Task 1
1. A brief explanation of the proposed topic and why you have chosen it
The distribution of different aspects, for instance, products and services, technology, data, jobs
and others on a global level across the national borders as well as cultures can be termed as
globalisation (Munt and Mowforth, 2015). In the context of economy, the process of
globalisation can be referred to as the inter-dependence of the different countries in terms of free
trade and commerce. This process has paved in the way from businesses small, medium and big,
various kinds of scopes and opportunities, such as stabilised security, more amount of wealth as
well as equality throughout the globe and many others. One of the positive impacts of this
process is the provision of international market penetration through various manners, for instance
joint venture.
Formation of joint ventures for penetration of the global markets can be referred to as
international joint ventures (Hong and Chan, 2014). Formation of these international joint
ventures is subjected to various kinds of risks as well as benefits. The different aspects related to
international joint venture affecting the retail-clothing organisation named Zara, forming a joint
venture with the company named MetersBonwe, for entering the markets of China will be
discussed in this study. In addition to that, the nature of the diverse advantages along with the
disadvantages connected with these types of joint ventures will be investigated in this study, for
identifying the available commercially viable solutions, which can be provided to Zara, for
mitigating the negative impacts.
2. An aim and some objectives for your proposed research
Project Aim
The business project aims at assessing the positive as well as the negative impacts related to the
formation of the joint venture between the British retailer of clothing and accessories named Zara
and the Chinese clothing brand named MetersBonwe, for entering the retail markets of the
nation.
Project Objective
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The objective of a project can be referred to as the desired outcomes or results that is the
business project is required to accomplish at the time of conclusion (Boyle, 2017). The various
objectives of a business project is inclusive of different factors, for instance, substantial purposes
that needs measurements, specification of an effective bus get, along with various aspects. The
objectives of this business project are discussed as follows:
Business objectives
 To assess the different aspects related to formation of international joint ventures
 To identify the advantages that the international joint ventures can provide to the partner
organisations
 To distinguish the risks and limitations connected to the development of joint ventures for
entering global markets
 To discover methods and strategies that can resolve the negative effects related to
international joint ventures
3. A brief discussion of the scope and limitations of the project
Project Scope
The component of the business project that is comprised of factors such as short listing and
drafting a number of specific tasks and duties, for instance, incurred expenses, deliverables and
many others can be referred to as project scope, in terms of project management (Crawford,
2014). The included scopes as well as the excluded scopes of this business project are classifies
as follows:
Included Scope
The different scopes that will be included in this business project will comprise of the authentic
and relevant information gathered from the employees and managers of Zara though primary
methods, concerning the benefits and limitations connected to the formation of joint venture with
MetersBonwe for penetrating the markets of China.
Excluded Scope
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Any kind of data collected though secondary methods regarding the advantages and risks related
to the creation of the joint venture in between Zara and MetersBonwe for entering the markets of
China will fall under the excluded scopes of this business project.
Deliverables
The progression of the business project will consider identification of the different kinds of
benefits as well as risks and threats related to the formation of international joint ventures for
entering international markets. Data regarding this particular topic will be collected through
surveying and interviewing that will be analysed through quantitative as well as qualitative
methods. The different aspects related to the joint ventures that are not of international in nature,
shall be excluded from the business project. On the foundation of the analysis of the primary
data, recommendations will be provided to the two partner companies for mitigating the risks
and limitations connected to formation of international joint ventures for penetrating global
markets.
4. Resources and cost considerations
Allocation of Resources and Consideration of Costs
Tasks and Activities Estimated Time
(Days)
Estimated expense
Per Day (£) Overall Sum (£)
Development of
Project Management
Plan though
consideration of
costs, timescales,
risks, and others as
such
7 60 480
Allocation of the
identified resources 5 20 100
Assortment of
relevant data
15 150 2250
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through
implementation of
primary methods
Analysis of the
gathered
information though
qualitative and
quantitative methods
7 300 2100
Occurrence of
different predictable
issues
5 20 100
Preparation for final
documentation for
project submission
5 40 200
Total = 5230
Table 1: Allocation of Resources and Consideration of Costs
(Source: Created by the learner)
5. A Gantt chart or work breakdown structure in order to provide timeframes and stages
for completion
Work Breakdown Framework of the Project
Number Activities Commencement
Date Duration Conclusion
Date
1 Beginning of the Business
Project 2/25/2019 7 3/4/2019
1.1 Development of project Aims
and Objectives 2/25/2019 2 2/27/2019
1.2 Allocation of identified
resources 2/27/2019 5 3/4/2019
2 Examining and selecting 3/4/2019 3 3/7/2019
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methodologies
Communicating with the
project management team 3/4/2019 1 3/5/2019
Development of survey
questionnaires and interview
questions
3/5/2019 2 3/7/2019
3 Assortment of Primary Data 3/7/2019 15 3/22/2019
3.1 Carrying out survey with the
employees of Zara 3/7/2019 10 3/17/2019
3.2 Carrying out interview with
the managers of Zara 3/17/2019 5 3/22/2019
4 Analysis of Assembled Data 3/22/2019 7 3/29/2019
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Conclusion of the Business
Project by providing
Recommendations
3/29/2019 4 4/2/2019
6 Final Drafting of the
Business project 4/2/2019 3 4/5/2019
7 Business project
Finalisation 4/5/2019 2 4/7/2019
Table 2: Work Breakdown Framework of the Project
(Source: Created by the learner)
Gantt chart
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Beginning of the Business Project
Examining and selecting methodologies
Assortment of Primary Data
Analysis of Assembled Data
Conclusion of the Business Project by providing
Recommendations
Final Drafting of the Business project
Business project Finalisation
2/25 3/7 3/17 3/27 4/6 4/16
Figure 1: Gantt chart
(Source: Created by the learner)
6. A risk register covering the main risks with the proposed research
Register of Risk
Drivers of
Risk
Possibility
of
Occurrence
Risk
Nature
Risk Impact Outcome on the
Business Project
Suitable
Measures
Wrongful
identification
of required
resources
corresponded
by improper
allocation
Medium High
It will affect the
overall
progression of
the business
project
The aims and
objectives of the
business project
will not be
developed
properly
A proper
project
management
plan should be
developed prior
to
commencement
of the business
project
Assortment of
inappropriate
Medium High The aims and
objectives of
The outcomes of
the business
The project
manager must
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information
the business
project will not
be
accomplished
effectively
resulting in
unsuitable
outcomes
project will not
align with the
predetermined
project aims and
objectives
provide the
project team
with
appropriate
training
regarding
primary data
collection
Wrongful
analysis of
the gathered
information
Low High
The aims and
objectives of
the business
project will not
be
accomplished
properly
resulting in
inappropriate
outcomes
The outcomes of
the business
project will not
align with the
predetermined
project aims and
objectives
The project
manager must
provide the
project team
with
appropriate
training
regarding
quantitative and
qualitative data
analysis
Other
predictable
issues and
problems
High Medium
These issues
will obstruct the
smooth
progression of
the business
project
The completion
of the project
will be delayed
The project
manager and
the team
members must
be prepared
with suitable
measures for
overcoming
these issues and
problems
Table 3: Register of Risk
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(Source: Created by the learner)
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Task 2
Chapter 1: Introduction
1.1 Introduction
There are various aspects related to a business, for instance, popularity of the products and
services offered in the foreign country, tariff rates, expenses connected to marketing,
transportation costs and others, affect the decision-making process of a business regarding
selection of a strategy for penetrating forgiven or international markets. One of the most popular
strategies of penetrating international markets because of the process of globalisation is the
formation of joint ventures between organisations belonging to two different countries. This kind
of joint venture is also termed as international joint ventures because of the nature of the business
operations. This business strategy is popular as it reduces the risks related to direct exporting. On
the other hand, as formation of a joint venture results in creation of third legal entity, there are
various general and legal limitations and risks linked to these kinds of joint ventures, although
normally both the partners share the incurred risks. In this project, the different kinds of risks as
well as the various types of benefits that the fashion retailer organisation named Zara can come
across by forming a joint venture with the Chinese apparel company called MetersBonwe in the
lands of China will be investigated and discussed.
1.2 Background of the Company
The Zara SA is a Spanish organisation of fashion retailing. The organisation was established in
the year 1974 by two entities named Amancio Ortega and Rosalía Mera in the nation of Spain.
At present, the organisation belongs to the business named Inditex, which is one of the leading
distribution groups in the world, is headquartered in the same country and has around seven
thousand stores in over two hundred and two markets all across the globe (Inditex.com, 2019).
The company has a workforce strength of over than seventeen thousand staffs, and generates
amount of around £14.4 billion from sales on a yearly basis (Forbes, 2019). As Zara requires the
time span of only a week for developing a new product and distributed to its major stores located
in different regions of the world, it is mainly known for its fast fashion.
Chapter 2: Literature Review
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