International marketing refers as business operations in other countries in which organization design about products plan, place, promote and direct flow of distribution. It is important to expand target market, enhance brand reputation and connect business with other organization. Present report is based on Sainsbury which is the largest retailer of food and other product in UK market. They offer their services in term of online or offline within the organization and outside the business. This report covers strategies which evaluates goals and aims of company to expand enterprise in foreign markets. Furthermore, it covers insightful analysis on some aspects of culture such as values, norms and communication styles. Cited business wants to operate their operations in India.
COMPANY BACKGROUND – Sainsbury PLC
Sainsbury design to supply their products according to customers needs and wants. They considered various capabilities of organization and environmental aspects as well such as demographic, competitive and legal cultural. Marketing provide them opportunity to meet with customers expectation through combining optimal products characteristics. It was founded in 1869 by John Sainsbury in London and now onward it is the biggest retailers chain in UK. Cited business expand their markets 4000 + sores in other nations. Their retail sales in 2014-15 was £23, 168m and operating profits of 2015-16 is 635£m . Chosen business revealed 14% drop annual profits after rising in discounts. In developed country Sainsbury's has the highest share market and they expand their new stores after 2014. This assists to grow their business in new areas of worldwide. Now they earn their profits in another countries and this helps to improve overall development of organization.
INTRODUCTION – India
India is situated between bay of Bengal and Indian ocean which has one-third size as Europe. It has very long and dramatic cultural history. In term of population, India take place on 2nd largest country in the world. Beside this, area wise it comes on the 7th position in the world. Mainly this country follow cultural system and they use traditional method for develop their nation. Delhi is the capital of India which is known as heart of country (Tietze, 2013). Main cities of the nation are Kolkata, Chennai, Assam, Karnataka and many more places. India is famous for food production and they provide various food products to across the national boundaries. In this context, includes rice, wheat, spices and many more things. Main occupation of this country is agriculture because many populations lives in village so they doing farming as business. Many countries depend on India for raw-material to make finished goods in their industry (Boussebaa, Morgan and Sturdy, 2012). In India many ethics groups find and there are people who spoke around hundred of separate languages. People worship multiplicity of gods. Thus, organization has completing different types of people who belongs to different region or culture.
POLITICAL & LEGAL ANALYSIS
Political analysis refers to identifying factors that affects to Sainsbury operations within the country and outside the boundaries. These factors create indirect effects which helps to pay attention from the markets. In this context, political factors includes regarding taxation rules and policies which create impact on business (Collings, Scullion and Vaiman, 2011). Thus, in cited firm they need to follows rules and policies which have been made by the government. In this context, government policies mention that what product organization should provide. India has the largest democracy in the whole world, it runs as federal form of government. When Sainsbury enter into India's market, company influence by the various factors such as policies, politician interests and many more things. Beside this, taxation system also develop by the various taxes such as income tax, services tax and sales tax. It encourages to cited business as they can freely do their business in India's markets. Following are the assessment which organization considered in new market of business:
Different types of political system
Government play very important role for develop country's market. Generally they are responsible for development of nations and their operations. In India different state has diverse political government which make various rules for business. Thus, different parties make differ rules and regulations which affects to the Sainsbury's operations. In this political relations are not stable so that cited firm can face many issues regarding political aspects.
Role of government in the economy
Government play essential role for developing relations with other countries. It also helps to maintain well economic conditions of business and country as well. In this context, in growth of Sainsbury business have greatly impact by the Indian government. Through this business provide employment opportunities in country and government offer to enhance potential customers in the nation.
Legal factors effects to health and safety requirements regarding employees of Sainsbury. This is because, organization need to monitor on employees working conditions. Chosen business has some legal boundaries such as legal forces local and national markets. Thus, they should concentrate on discrimination of age and disability legislation. Legal factors also comprises as environmental factors. In this context, environmental factors includes changing in weather or climate (Jia, You and Du, 2012). Changes in theses aspects can impact on operations of business in term of manufacturing, farming and exporting as well. Thus, organization need to be aware of these factors which is important issues of chosen business. In recent times various legal changes are implement in India such as recycling, pay minimum wages and safety workplace, etc. This is because, country wants to develop living standards of employees. As a result of this, cited firm need to develop their systems for enhance profits of business in Indian market. This can be done by providing safe workplace to employees with establishment of various environmental pressure groups. With the help of these aspects company can increase their market share so that it create positive impact on the business operations. Following are the assessment which organization considered in new market of business:
Legal framework of system
India is most preferable country for welfare of person of nation. They make rules and regulation for benefits of people of country. Thus, Sainsbury need to follow that rules and regulations which assists in better opportunities and overall development of business. Through this they will be able to make stable relationship with the other business and people of country.
Other policies and systems
Government of India makes other policies and system such as import-export policy, national health policy and many more things. In this context, Sainsbury doing their operations according to entire import and export policy in the country markets. This is because. Their aims is to create strong value of entire business activities.
Sainsbury wants to operate their new branch of physical store in India market which helps to get high market share for their business. In this context, some economic factors included which create impact on their business. Economic factors includes changing exchange rates and national GDP or income which create major impact on company behaviour (Kolk and Van Tulder, 2010). India is 12th world largest on the basis of exchange rates. Economy of this country moved to market system which is based on liberalization started from 1991. Growth of nation enhance in 2000 with healthier economic reforms and policies. 54% of the GDP comprises from the service industry whereas 29% from industrial sector and 17% by agriculture. Main occupation of Indian culture is agriculture which employ 60% of the population in services industry. This is major impact on the Sainsbury that they will able to get raw-material easily for their business.
Main Agriculture products are rice, wheat, tea and species, etc. They also operate their operations in textile industry, steel, chemical and IT sectors. With the help of these, country gain more customers into the worldwide. GDP of the country is $1.209 trillion (2008 est), GDP growth is 6.7% (2009) and per capita income is $1016. It considered interest rates, taxation changes, inflation and exchange rates. It creates major impact on Sainsbury. For example, higher interest rates reduce investment due to more cost for borrowings (Harzing and Pinnington, 2010). Further, strong currency make exporting difficult because it can raise price according to foreign currency in cited business. Besides this, higher national income growth enhance demand for the company's products.
In order to solve the problems of economic of country, government took several steps including control by state of certain industries, central planning and reduce importance of private sectors (Chhokar, Brodbeck and House, 2013). Main objectives of Sainsbury to operate their functions in India's market as follows:
- To initiate rapid growth for enhance standard of living of Indian people.
- To increase their market because India has many populations which purchase the organization's products.
- Become self-reliant and set-up strong industrial base of the business.
- Adopt socialist pattern of development of business.
With the help of these aspects India's economic conditions improve continuously. Their GDP and purchasing power parity is estimate almost 3.965 trillion US (Ashutosh and Mountz, 2011). Dollars in 2009.real growth of GDP rate was 6% and it is the 3rd highest GDP in term of purchasing power parity.
ETHICS AND SOCIAL ANALYSIS
Social changes can impact on the demand for products of Sainsbury. It determines characteristics of the society in which organization operate their functions. Organization have responsibility for their surrounding people for example arranging social activities and raising fund for animals and society welfare (Yang, Hong and Modi, 2011). In this context, cited business defines various characteristics of social group such as literacy rate, customs, values and beliefs, etc. which are part of social environment For instance, the organization recruit employee for giving them employment opportunity. Furthermore, social factors generates impact on business in term of size of population and income. Beside this, manager of chosen business have responsibility to notice direction in which firm move.
Ethical analysis factors includes changes in working conditions of employees. Changes of these aspects can impact on many business which are linked with Sainsbury. With the helps of this analysis organization solve human resource problem which country face. This is because it promotes to employment opportunities for the nation.
Culture is the most important part of human being's life. In UK there are maximum number of people follow the Christianity religion, approx percentage is 61.4%. Not only their language but also there rituals, traditions are far differed from others. Research explains that number of Christians are more in UK, than other community. Apart from this there are many other religions which are followed by individuals of Australia (Mellahi and Frynas, 2015). To reduce the competition related to religion, government have strict rules and regulations and high level of security. So many diversified employees work in Sainsbury, their culture and traditions are different. These differences affect the overall working of the firm. It is very difficult for the manager to manage such huge differences and make them understand regarding work practices, norms etc. Some time company feels unable to mange such individuals and thus, it affects the growth of the country (Tietze, 2013). Because people do not understand the culture of such workplace and feel dissatisfy in the workplace, so it becomes difficult for them to survive in differed environment.
As Sainsbury is planning to open stores in India so it has to understand the overall culture of Indian people and have to act according to them to run business successfully. As India is the democratic country and all persons have individual rights, no one can bound to anyone. In Indian organizations, manager guide employees properly and involve them in decision making process. By this way workers feel participated in the business unit. With the help of Hofstede’s dimensions & relevance model, Sainsbury can understand the culture of the country and can establish the firm as per the norms of country (Boussebaa, Morgan and Sturdy, 2012). This can give huge success to organization because when foreign country adopts the culture of other nation then workers feel satisfy and like the workplace and perform better because of high satisfaction
This model consists of six dimensions; Power distance, individualism versus, Masculinity versus, Uncertainty avoidance, Long term orientation and indulgence versus restraint. UK is the Indulgent country in which people spend more money on expensive items whereas Indian people beliefs in saving money. If Sainsbury follow the culture of guiding people and make them involve in decision making process so new branch of Sainsbury can be established in India easily and it can earn more profit (Collings, Scullion and Vaiman, 2011). If company offers them good salary packages and importance at workplace then, they can perform better. By this way organization can get good profit.
RECOMMENDATION FOR INTERNATIONAL STRATEGY
In order to successfully enter in the international market that is India Sainsbury must focuses on selecting effective international strategy that support them in entering into the new market. The key aim of Sainsbury is to expand their business activities in the international market mainly in the Asian market in order to attain distinct position. Along with this, there are different international strategy that must be focused by Sainsbury in order to attain competitive position. The recommended international strategy for the cited supermarket is global standardization strategy. Under this recommended strategy international manager of supermarket focuses on standardized approach for performing their international activities.
RECOMMENDATION FOR ENTRY MODE WITH JUSTIFICATION
Along with this, to enter into Asian market it is essential for international manager to focus on effective entry mode. The giant retail supermarket focuses on different modes of entry to enter into the Asian market the modes basically include exporting, franchising, licensing etc. exporting is defined as mode under which supermarket transfer the range of merchandise and products to other country for the selling purpose (Alcadipani and et.al 2012). On the other hand, franchising focuses on mode of entry under which owner distributes or grants permission to other dealers for selling of the goods and services. Therefore, it is recommended that Sainsbury must engage in exporting mode of entry for entering into international market as it plays significant role in gaining global market share through enhancing their competitiveness in the domestic market.
HRM ANALYSIS AND RECOMMENDATION
Therefore, it is essential for international manager to analyse the requirement of human resources as well as labour relation within Asian market. It has been analysed that international labour relation within Indian market is mainly influence by the power of union as well as frequent strikes (Jia, You and Du, 2012). Thus, it has been recommended that company would basically focuses on providing proper training to the employees that are transfer to the new market so that they can easily perform their activities. Along with this, it is also recommended that HRM must also focuses on fostering the global collaboration as they have less knowledge regarding the operation so that they can easily raise the global collaboration so that they can perform their activities in the standard manner. Along with this, international manager must also focuses on selecting effective HRM approach that must focuses on ethnocentric, poly-centric or geocentric.
METHODS AND STRATEGIES FOR MOTIOVATION AND LEADERSHIP
In order to succeed in the Indian market, giant supermarket must focuses on managing cross culture or diverse teams so that they can successfully operates their activities in the international market (Farndale, Scullion and Sparrow, 2010). Therefore, it is essential for the international manager to focus on different methods and strategies to motivate the diverse and cross culture teams. The recommended methods and strategies for motivating and managing diverse teams are providing them monetary and non-monetary benefits, focuses on participative leadership styles etc. that would encourage the individual in managing the diverse culture teams.
From the aforementioned report it has been concluded that to sustain in the competitive marketplace it is essential for the manager to focuses on engaging their activities in the international market. Along with this, report has also assessed the macro environmental factors that need to be taken into the consideration by the international manager to successfully engage its activities in internationalization. Moreover, in success of Indian market, giant supermarket focus on managing cross culture. Thus, it will helpful for operating business activities in international markets.
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