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Explain the Reason for Entering Foreign Country or Market for the Products and Services Distribution.

Essay by Meei Yi  •  July 28, 2015  •  Research Paper  •  546 Words (3 Pages)  •  704 Views

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2.0 Explain the reason for entering foreign country or market for the products and services distribution.

There are some reasons for us to distribute our products to the Indian. The first reason is massive growth of the market. The economy in Indian is developing rapidly compare with other country. Currently, the Indian market has about 1 billion of population which give a good opportunity for foreign investor to expand their business here.  Therefore, by introducing our products, we can expand our consumer base, sales and income simultaneously.

The second reason is the large labour force. Indian is a democracy and also a populous country which ranks the second in the world. It has large labour force which available at a relatively modest cost. By having this advantage, we can reduce our production costs and this will leads to increase in profit margin.

The next reason is the uniqueness of our product. We believe that our unique patties and cooking method can attract a lot of attention from different customers in Indian.  In addition, we also provide fast service and most importantly the price is affordable for everyone. All sorts of benefits can help us to attract a wide range of customers such as office workers and students.

Last but not least, by entering into Indian market, we can take this opportunity to gather all kinds of ideas from their different lifestyles as well as to expand our workforce. By doing this, it can helps to improve and innovating new products to help us to achieve sustainable development and profitability.

6.0 Relevant theory to discuss the analysis of the foreign country environment.

In here, we are applying the international product life cycle theory. As in first stage which is known as new product stage, we do not know the demand in Indian market, so we produce our products in Malaysia and exports to Indian. We will first conduct our surveys and identify the needs of customer. After that we will promote our products in Indian market and make sure that our products are ready to meet the demands. In the initial stage, we can see that our sales are growing rapidly, this is because low competition in the market.

Coming into the second stage which is maturing product stage, we will gradually integrate into the Indian market as we blend our product with their culture and this will help us in understanding their needs. So, we will start manufacture our products by building the manufacture factory in Indian as the demands for our products are great enough to support us in investing production facilities.

In the final stage which also called standardized product stage. Coming into this stage, our sales volume may decrease. This may be caused by the emergence of competitors. We may reduce our production cost as we have the advantage of large labour force which available at a moderate cost in order to compete with our competitors. Although the profit may decrease, our business will still remain attractive as the sales volume is high and development cost is low.

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