Market Entry

The Situation:
iStoreFront ( is an Interactive Marketing Platform (IMP) that will revolutionise the retail industry by allowing retailers the ability to engage with customers on their terms and in ways that put the customer in charge of the shopping experience

iStoreFront has designed a retailer platform which engages the customer at the point of contact of the retailer. The iSF Units use the latest technology to create a high dynamic colour platform, combined with a multi touch interface allowing the retailer to market to in real time and immerse their customer in a completely new way of window shopping.
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The iSF6 gives the retailers the ability to advance their brands, products, designs through a stylishly beautiful way –  a way in which the customer can engage in a kaleidoscope of tailor made and designed interfaces.

Customers that would normally only spend a gaze while walking past a retail storefront our iSF6 models now reaches out to engage back the shopper to interact with the unique Retailer iSF Applications giving the retailer control over tailored campaigns incorporating high contrast images and high definition video.

The iStoreFront technology has been beta tested in the New Zealand market and has passed with flying colours. The company has been advised that it would be best to expand globally as quickly as is feasible.  Unfortunately, the company has no experience in international business and is looking for assistance.
You are an International Business Consultant, and the company has asked you to report and make recommendations as to how they should go about entering the Global market. The details of your report can be found below. Maximum word count 4,500.
A) Analysis
Your analysis should include, but not necessarily be limited to the following:
1)  PESTL Analysis (Political, Economic, Social, Technological, and Legal, including taxation)
•    Will the company be liable for taxes in the target and home countries on revenue generated in the target country?
•    What regulations might they have to comply with from the foreign governments?
•    Are there laws in the target country that govern advertising that the company should be aware of?
•    Does membership of a trading bloc affect them?
•    What is the best way (if any) to protect their Intellectual Property and why?
2)  Product
•    Given that this product was designed for New Zealanders and that the cultural differences between NZ and the target country may be many, what are the specific cultural issues that need to be considered?
•    Is traditional storefront advertising different in the target country than that found in New Zealand?
•    Are there similar or analogous products in the target country?
•    Use your knowledge to think about threats that may come from the target country and how you would deal with them.
•    What level of technology is the target country at, could they be looked at as at a level where horizontal diversification could be entered.
3)  Pricing
•    Can the company charge the same price for their product/service in the target country as it does in the local market? If not, how would they go about determining a competitive price?
•    What currency should/must they use?
•    What are the tax laws in relation to outside companies entering theirs.
4)  Promotion
•    What is the best way for the company to promote the iStoreFront solution in the target country given that the company does not have the skills and resources to do this in house?
5)  Currency and Banking
•    What banking arrangements might they need?
•    Is there risk associated with currency fluctuations and if so, how would you suggest that the company mitigated these risks?
6)  HR
•    Should the company have people representing them in the countries they are exporting to, and if so, should they be locals or globally sourced?
•    What are the cultural issues that need to be considered when hiring foreign staff and why are they important?
•    What is the average income for particular personnel of which the company would look at employing in such areas as distribution to personnel management, and other positions of which the company may look at using outsourced.
•    The aforementioned questions are presented as a guide. Please feel free to provide any other analysis that you deem relevant. Further, all of the questions demand more than a simple, one sentence answer in order to be considered complete.

B) Recommendations
Based on your overall analysis you should recommend:
1.    Whether or not to enter the particular market you have chosen to analyse
2.    Which is the best market entry strategy to do so?
•    Exporting – Direct sales to end-user
•    Licensing/Franchising
•    Joint venture
•    Acquisition
•    Green-field operations
3.    General recommendations based on your analysis.
4.    If you conclude that the company should not enter the market, you still need to indicate which market entry strategy you would recommend if the company were to do so with justifications.
5.    You should also indicate in this section what additional information (if any) is required to further substantiate your recommendations and expound on why that information is important.
*Important – any and all claims must be supported by at least one reputable source.

Marking Scheme
PESTL Analysis    25 Marks
Product Analysis    10 Marks
Pricing Analysis    10 Marks
Promotion Analysis    10 Marks
Currency and Banking Analysis    10 Marks
HR Analysis    10 Marks
Recommendations    25 Marks

Total    100 Marks

Learning outcomes covered by this assignment    3, 4, 5, 6, 7

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