The Institutional Affiliation
Entering a foreign market is an important step in every company’s experience. International market expansion benefits the business in many ways. It is also challenging and requires thought out strategy supported by a successful local market performance. The Canadian based company, the Booster Juice, is a good example of difficulties and opportunities a business can face when expanding into international markets.
Indian market is quite different from the specificity of conducting a business in the United States, Canada, even Europe. Therefore, a company must consider the specifics of Indian culture, customs and traditions in order to win the clients loyalty and attention. I believe that difference in culture, habits and preferences of people is the first positive aspect in the Indian market. Innovations have been selling great at all times. Same as Chinese cuisine in Europe or Indian food in America, Canadian food and beverages are popular in India. They are made from different products, the recipes and proportions are different, servings and appearance are different too. It gives international products, in particular, food, a chance to cause great interest among Indian gourmets.
The Indian market has other advantages such as openness to foreign investments and developed infrastructure. Even though the country belongs to developing states, it strengthens its economy and market base very quickly. Indian constantly works on improving its investment climate and conducting-business environment. India has many religions, nationalities and languages. It welcomes diversity and foreign brands which are a great advantage over other countries markets. India is also one of the most visited places in the world. Millions of tourist come to visit it each year which positively influences the business. It helps to establish new contacts and be recognized by consumers from all over the world not only India.
Despite the fact that India has a lot to offer to the potential investors, it also challenges them with threats such as remoteness, complexity and governance framework. First of all, India consists of many regions which have their own peculiarities and administrative systems. That's why the Indian market is conditionally divided into many smaller business platforms. Secondly, the cost of delivering the products to another continent is rather high. Shipping to remote places like India might result in lower income that's why it is important to compare negative and positive aspects before entering a remote foreign market. Third, the governance framework of India depends on two structures - central and state. The company must deal with many bureaucratic procedures when starting a business in India and make sure to meet both the central and state regulations.
If I was Dale Wishewan, I would pursue a few proven strategies and rely on other successful companies international experience. First of all, I would choose an international strategy which differs from a global strategy for a couple of reasons. An international strategy allows local subsidiaries to act independently from the parent organization. A global strategy, in the opposite, refers to a single network of companies that are directly dependent on the parent one around the world. An international strategy would allow locations in India to conduct business activities independently or without precise coordination with the main office. An international strategy means responsiveness to local needs. The global strategy usually doesn't require adjusting the product to the local clients preferences while international one is developed to make sure that cooking and serving standards do not differ from those that are common in the area. The international strategy also provides local companies with the opportunity to determine their “competitor moves” instead of following directions from the parent company. I believe that coordination with the centre is important, however, it must be moderate in order not to have a negative effect on the subsidiaries reputation.
If I was to choose an entry strategy, it would be franchising. I believe that non-equity model which includes licensing, franchising, exporting and importing is perfect for businesses like the Booster Juice. Equity models which include joint ventures, alliances and wholly owned branches are more relevant for large businesses and corporations. Food places and retail stores that expand internationally usually operate on license and franchise basis. I would choose the second one due to a number of reasons. First of all, it grants the parent company more rights to control the business process conducted in another area. Secondly, it receives financial benefit with a minimum participation in production under its own name. Besides that, the franchisor is obliged to provide initial training, recommendations, and other necessary support, including technical, in order for the franchisee to start running the business. Franchising involves comparably low cost, minimum political risk, provides an opportunity of entering a few foreign markets simultaneously, and new human resource capabilities.
I believe that Dale Wishewan made a right decision to enter the Indian market as well as other business platforms around the world. I also support his aim to provide people in the most remote locations and countries with healthy and tasty food and beverages.
