Discuss about the Company entrants in new Korean Market.
This report reflects the key understanding on the business strategies and how new company could grow and enhance its business in new market. With the increasing ramification of economic changes, each and every organization has to expand its business either by product development or market expansion. The main profitable business method for the organization is related to how company could implement its formulated strategic plans and procedure for the betterment of organizations. It is considered that growth of business is depends upon the effectiveness of strategies and plans implemented by KMP of organizations. This report reflects the strategies and long term plans which could implement with a view to implement its business in new market. In this report, study has been conducted on Kelly & Windsor organization which is entering into Korea for the first time. The growth and expansion plans of company are prepared by Top management and key managerial persons with a view to expand their business on next level. In this report, various strategies and plans for Kelly & Windsor organizations has been considered which could be used by this company for setting up its new venture in Korea. After that, opportunity and other growths available in Korea have been evaluated for the betterment of Kelly & Windsor organization. After that, key points have been analyzed to identify the threat factors which Kelly & Windsor organization would face while introducing its new product in Korea market.
It is an Australian company which has been running its business since very long time with a view to sell its fashion industry products and services on international level. The Kelly & Windsor organization brand of luxury alpaca quilts, duvets, pillow and other fashion products are considered as high quality products around the globe. The main headquarter of company is in Australia and has been tapping various international market through its online business portal.
It has vision to design, manufacture, and distribute a unique Australian based premium quality range of luxury bedding accessories.
It has mission to tap into various international market and create strong international brand image. Company also had structured its business to grab at least 25 % international market in selling of unique Australian based premium quality range of luxury bedding accessories.
With the increasing ramification of economic changes, various organizations are entering into new untouched market industry of Korea market. After evaluating the secondary data such as Official magazine, postal ballot and other details of company, it is considered that in spite of forth largest economy of Asia, it does not have more companies in its economy which could sell luxurious products and services to the resident of Korea. It is further evaluated that GDP of Korea is Nominal: $1.4466 trillion which is showing GDP growth rate of 2.7% throughout the time (Kang and Choi, 2016). The main probability of growth could be evaluated by the negative balance of trade of economy of Korea. It shows that Korea is indulged in making more than $526.76 billion import in its economy. The biggest seller is Alibaba which is online market seller and provides high quality of goods and services in luxurious and non-luxurious products. Furthermore, in terms of growth, and low cost productivity for Kelly & Windsor organization, it could be evaluated that company could expand its business in Korea with fewer problems (Kolios, and Read, 2013). The unemployment rate in Korea is 3.1% which could be result to availability of employees and labor at very low cost. In addition to this, interest rate issued by central authority of Korea is also comparatively less which could allow organizations to raise funds and finance at very low cost. However, with the ramified economic growth and trend of international products, People in Korea are more inclined towards new Malls and buying premium quality range of luxury bedding accessories. This level of changes provides high level of business growth and expansion opportunity for Kelly & Windsor to run its business effectively and successfully. Nonetheless, company has shown 25% increment in its overall turnover since last five years (Ho, 2014). Products sold by Kelly & Windsor are also in high demand in developing countries such as India, Russia, China, Indonesia and Korea. Therefore, if Kelly & Windsor wants to tap into this new Korea economy then it could either follow customized or standard business functioning with effective strategic planning. The Kelly & Windsor organization brand of luxury alpaca quilts, duvets, pillow and other fashion products are considered as high quality products around the globe, However, modification in existing products as per the client’s demand and products will put the Kelly & Windsor organization’s products and services distinguish from those of others in Korea market (Suh, 2014).
Analysis of Korean market
It is accompanied by the changes in the political parts and stability of political parties of Korea. It is evaluated that Political parties of Korea changes each and every five years on the basis of following proper democracy process. However, established level of policies and measures by one political party could not be changed by different political parties without highlighting this matter in parliament (Li, et al. 2015). The Kelly & Windsor organization brand of luxury alpaca quilts, duvets, pillow and other fashion products could be launched in Korea on the basis of existing rules and regulations issued by political parties. Top management department of Kelly & Windsor organization could be certain with the existing rules and policies of Korea economy and create its expansion and new business plans in determined approach. As per the existing policies and rules of Korea, Kelly & Windsor organization could start its outlet in commercial area to sell all the and also apply for the government assistance for taking loan and subsidiaries for the betterment of organizations and public at large (Kwon, et al. 2016).
This factor reflects the interest rate, purchasing power parity, Gross domestic product rate, employment rate and fluctuation in inflation and foreign exchange reserve of economy. It is evaluated that due to less effective employment rate in Korea, Kelly & Windsor organization could hire employees at very low cost which could not only reduce the overall cost but also provide creative and innovative mind. In addition to this, inflation rate of Korea is also very stable which reflects positive investment creation opportunity for the organization. Furthermore, less amount of interest rate will assist company to raise more company at very low cost from the market. It has evaluated that if Kelly & Windsor organization will start its business in Korea then it will have high level of growth opportunity and creative investment opportunity in luxury brand products (Hemmert, et al, 2016).
These issues provide all the associated factors of government changes and implemented policies in Korea. It is evaluated that luxury alpaca quilts; duvets, pillow and other fashion products sold in Korea would be charged at certain level of tariff and traits. If Kelly & Windsor organization imports the goods in Korea by considering certain level of Tariff and traits then could determine the selling price of its products at same points of consideration. Furthermore, while considering the legal issues, company needs to establish proper level of nexus between legal and political factors while determining its management and strategy points. There are several requirements such as corporate governance, corporate social responsibilities and other corporation acts rules and regulations which Kelly & Windsor organization needs to comply with for effective launching of its luxury alpaca quilts, duvets, pillow and other fashion products in Korea (Kang, Yoon and Rhee, 2017).
This factor is accompanied by choices, perceptions and values, belief and customers wants and need in Korea. It is evaluated that people in Korea are more inclined towards buying customized luxury products and services from the multinational company. In addition to this, Kelly & Windsor organization could also use this strategy with a view to customized its products and services in market (Shukla, et al. 2016). This level of strategy will not only increase the overall sales of company but also increase the brand image of company on international level. However, company could also sales its products and services as standardized products for keeping the essence of its famous products in Korea as well. These social factors are different in different countries which should be considered by the top management of company while determining the core value of new venture in Korea (Ratten, 2016).
With the increasing ramification of economic changes, Enterprises resources planning is the best method which Kelly & Windsor organization needs to adopt while implementing its value chain activities in Korea (Jamal, 2017). This ERP system accompanied by cyber computing network will help employees, clients and other employees to effectively communicate with each other’s. There are several other organizations such as Mark and Spenser, Body shop and other companies which are selling all of it products online and offline in determined approach (Short, et al. 2013). It is observed that clients in Korea are more inclined towards new technologies. However, in the starting of introducing new luxury products in Korea, Kelly & Windsor organization needs to make changes in its existing products by installing upgraded technologies machines and plants in its value chain activities (Lee et al. 2016). This shows that company provides best quality of products and services to clients.
These factors are related with impact of the business organization on the environment. It is evaluated that the main impact of business functioning of company is related to supply of goods and services to company by the vendors. Trucks and other motor vehicles pollute the environment and showcase negative impact on the society. In addition to this, the products sold by company such as luxury alpaca quilts, duvets, pillow and other fashion products makes clients addictive towards buying luxurious products and increase their overall expenses in high manner. Therefore, it could be inferred that if Kelly & Windsor organization wants to enhance its business in Korea then it should cover up all of its environmental negative impacts in determined approach. In addition to this, environment changes and associated factors will be analyzed by company before tapping into Korean market (Dibrell,Craig and Neubaum, 2014).
Foreign exchange issues
It is evaluated that Korean market has made positive balance of trade in its import and export trade. The economics of Korea has shown 526.76 billion imports in its economy which is 76.34 billion less as compared to its trade. Nonetheless, foreign exchange reserve will increase in case of increase in overall export of country. If Kelly & Windsor organization will establish its business in Korean market then it will not only increase the foreign direct investment of this country but also increase the overall employment rate of economy. In addition to this, in context with Kelly & Windsor organization, it is considered that top management could also create profit out of foreign transactions while converting its Korean money in AUD. In addition to this, company could also face problem of foreign exchange due to strengthen rules and regulations of remittance of money in other country. It is observed that company could face issue of remittance of money in Australian country related to lock in period. This lock in period will not allow company to bring earned money in Australia back from the Korea (Zalengera, et al. 2014).
Cultural factors and challenges
After evaluating the cultural and social factors of Korea, it is considered that Korean culture has most powerful influence in 21st century. This level of changes could be seen by evaluating the adoptions of different factors, likes and wants of Korean people. Kelly & Windsor organization will have main focus on women and girls clients while selling its luxury alpaca quilts, duvets, pillow and other fashion products in Korea. The main focus would be made on women and other girls who are more inclined towards buying new luxurious products and services from the big organizations (Wiebe, et al. 2017). However, Kelly & Windsor organization would face problem in establishment of employee oriented culture. It is observed that if company wants to set up its new business chain in Korea then it has to hire employees from the existing business place, after that, it could hire new fresh employees in same value chain activities (Carr, 2014). Another issue which experienced employee of Kelly & Windsor organization would face is related to the communication in local language. It is evaluated that people in Korea are less flaunt with the English language. Therefore, in order to sell its products, Kelly & Windsor organization has to manage its online portal and dashboard as per the new Korean language. However, adding with the new language will surely increase the overall cost and decrease the efficiency of business. Furthermore, the main challenge is also related to management and team work. If company will have half experienced employees and half fresh employees then it will result to conflict in management of business and non- efficient value chain activities of Kelly & Windsor organization. Another problem would be related to customization of products and services in Korea. With the increasing ramification of economic changes, Kelly & Windsor organization has to make consistent changes in value chain activities which are completely cost consuming process (Kalvelage, et al. 2016).
Finance is the major critical part for the business success. It is evaluated that if company could implement proper level of financial management process then it could result to saving overall cost of capital. Financial management is related to raising and deployment of finance in the established business or Korea (Kim, 2013). It is considered that if Kelly & Windsor organization wants to tap into Korean market then it will take cost around USD 120 million. This cost of setting new venture has been determined on the basis of internal and external factors of business in same industry. Kelly & Windsor organization could raise this money from the market by issues of initial public offer/ further public offer, issue of bonds and debentures and other promissory notes in market (Nam, 2016).
There are the below details of finance which will be required by the company while tapping into new market.
Hiring of employees and staff members
Salary to employees=
Hiring and other expenses = 1Million
Salary to line managers = 5 million
Expenses for administration and operating expenses
Advertisement and promotions expense
Corporate governance issues
Cost For importing products from Australia
Cost for having license in Korea
Hiring and land management
After analyzing the macro and micro factors of Korea, it is considered that growth of Korean country is very high. However, the people in Korea are more inclined towards sophisticated products and services (Channon and Jalland, 2016). Nonetheless, established brand image of company will be helpful factors for Kelly & Windsor organization to tap into Korean market. In addition to this, I am observed that if company is going to make changes in its existing value chain activities by following proper level of business functioning then further changes needs to be made to customize its products and services as per the demand and need of Korean people. However, there are several rivals in Korean market which are offering various goods and services through online dashboard chains and models. It is further observed that if Kelly & Windsor organization wants to create competitive advantage in Korean market then it will have to use innovative and creative business plans at top level. However, segmentation of products and services as per the age, sex and income group of people could be made by Kelly & Windsor organization by applying proper level of cluster sample survey and stratified sample survey. This survey will help top management to determine the key success factors of organizations for the betterment of organizations (?irjevskis and Bad?ns, 2013). Therefore, it could be recommended that if Kelly & Windsor organization wants to tap into new market then it should make changes in its existing process system and has to customized its products and services as per the Korean client’s wants and need for the better level of satisfaction. However, PESTLE analysis of Korean market should also be analyzed by the Top management of Kelly & Windsor organization while formulating and implementing new strategic plans and procedure (Haruyama and Hashimoto, 2007).
This report provides strategies, viewpoints and plans which could be implemented with a view to enter into new market. In this report, study has been conducted on Kelly & Windsor organization which is entering into Korea for the first time and what type’s issues it would face. This study has provided deep understanding on the Korean market and how a new company could enter into market with the implemented strategic plans (Chesher, et al. 2013). Now in the end, it could be inferred that Kelly & Windsor organization could use effective cyber computing enterprises resources planning to make effective level of changes in its existing value chain activities. This level of changes is required to implement new strategic plans and innovative strategies so that company could give tough competition to existing business organizations in Korea such as Alibaba, Body shape and other companies. However, these companies do not have any outlet opened in Korean market rather they believe in providing their beauty products and services through their online portal. Therefore, it could be competitive advantage for Kelly & Windsor organization to open up a retail outlet in Korea to grasp the client through its offline strategic plans (Kim, 2013).
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