Analyzing Successful Implementation Of Market Participation And Entry Mode Strategies: Case Studies Of KFC And Toyota In An Essay.

Choose 2 of the topics that have been covered in lectures 4-9 from the following list:

• Lecture 1 - global strategy as business model change
• Lecture 2 - target markets and modes of entry
• Lecture 3 - globalising the value proposition
• Lecture 4 -global branding
• Lecture 5 - globalising the value chain infrastructure
• Lecture 6 - Globalising the supply chain

For each topic select 2 organisations (4 in total) from any 2 of the industries listed below, that have successfully applied the chosen theory and critically evaluate their approach and the reasons behind their success with respect to the theory.

Your evaluation should also include counter arguments where available, which consider alternative views on the theory topic or address situations in which an organisation has been successful contrary to the theory’s recommendations and why this has been the case.

Industries to select from:

1. Computer industry (hardware or software)
2. ICT industry (Information Communications Technology)
3. Pharmaceutical industry
4. Food / Beverage industry
5. Car Industry
6. Airline Industry
7. Hospitality

Due to the large number of groups at some campuses, the Lecturer will randomly select those groups who will present in class and those who will upload a video link to blackboard. Consequently, all groups should be ready to present by week 9/10 when in class presentations will commence The presentation will last no more than 10 mins and all members are required to present.

Students should consult the marking rubric (see below) to see exactly what is  required and how your assignment will be marked.

You should enrich this assignment with ideas from other materials such as journal articles. This additional research will be necessary to obtain the best marks.

All ideas in the report must be referenced using Harvard Referencing (in-text citations and full references at the back).

The presentation was a brief look at the topic but many questions were left unanswered.

Majority of information irrelevant and significant points left out.

The presentation was informative but several elements went unanswered.

Much of the information irrelevant; coverage of some of major points.

Most important information covered; little irrelevant info.

The presentation gave good insight into the topic.

The presentation was a concise insightful overview of the topic with all questions answered.

Comprehensive and complete coverage of information.

Late, disorganised, Multiple group members not participating /interrupting/ inattentive/chatting during presentation. Evident lack of preparation/rehearsal. Overdependent on slides.

Significant controlling by some members with one minimally contributing. Primarily prepared but with some dependence on just reading off slides

Target markets and modes of entry

The decision of participation in the market is global target markets and entrance modes. It depends that how an organization deal with clients to make better customer relationship. The option of consumers to serve in a specific country or region and with a specific culture dictates how and how much company can accept or adapt the value proposal of the company. The selection of target market depends on the affordability of companies (Jayawardhana and Weerawardena, 2014). It is required for the company to make decision while entering into any market and consider direct or indirect advantages of that market. It is required to analyze and evaluate the different strategies because it is not necessary that one superior strategy for one company, however, might have less possibility of following for another.

This figure shows the dimension of different strategy while entering into the new market. These strategies can be market segment, customer relationship and distribution services. It is crucial for the company to take decision appropriately in the time of making strategies. These decision should be covered with timing scale mode, communication mix and distribution partners. There is number of options available to enter in the new market such as franchising, licensing, Joint venture, partnership and direct exporting. It depends that which mode of entry would be suitable for the company.

KFC stands for Kentucky fried chicken that is situated in Louisville, Kentucky, constitutes one of the few brands organizations in America. It is the success business over 5 decades. The target market of KFC is for those who are interested in Non-veg. the KFC has grown enormously over the current years and recently it has more than 118 branches in all over the world. Principally, it has 4,563 outlets only in China, 4,491 in US and rest 9,821 in al over the world which is consider as the huge amount. The main menu of KFC is fried crispy chicken, fries, burgers and fruit juices. The reason behind the success of the KFC is accepting the right mode of entry that is franchising. The aim of KFC is to give delicious non-vegetarian food and fun environment to the customers. The rapid and successful international expansion is done due to accepting the franchising model. A franchise is the mode of entry which gave chance KFC to expand its business easily at cheaper way. Franchising is the most advantageous option in comparison of other market entry option because other option put control strictly over the operations (Chotipanich and Issarasak, 2017).

Franchises are outline to achieve the numerous purposes. It is the easiest mode in which chance of potential risk is lesser. Also, it involves in venturing to new markets (Bashel, 2010). It has been analyzed that in the year of 1990’s KFC entered in China by following the joint venture mode. The initiate of KFC was as joint venture with Government Poultry Department in which it had to face many issues. Afterwards, KFC partnered with the department of tourist to outline a joint venture because they had sufficient funds.

Participation in market

The first franchise territory was centered in the Xien, China. Currently it has number of franchisee in all over the world and the average revenue of KFC is $942,000 annually. It earns revenue from franchisees in two forms. That is service fees and rent. A Service fee is a fee which is paid on the basis of monthly sales. For instance, if franchisee of KFC earns 40,000 dollars, service tax should be paid at 5% of total monthly sales. It is the reason of growth of KFC’s in smoothly manner. Another revenue form is rent. A rent is also paid as per monthly sales. It is decides as per certain percentage of total monthly sales. Duration of franchise of KFC is 20 years (KFC, 2015). As a franchisee, it offers advantages such as give access to nationally and internationally known products for instance, Cole slaw, KFC biscuits and many more and a proven operating system which will be helpful to compete. The franchisee of KFC has more than 50 years and due to that support numerous programs helps to compete within the QSR and the industry of Franchise.

Toyota is the big multinational company which produces cars, trucks and buses, with headquarter in Japan. The target market of Toyota is those people who have great interest in automobile industry. That is why the main focus of this industry is on demographic segmentation.  It has been analyzed that Toyota was one of the company which products were imported. Joint ventures and alliances came in comfortable zone where Toyota collaborated with PSA and Volkswagen. Miles argued that (2013),Toyota expand its business by acquisition or merging factors of entry option and manufacture its cars in number of countries with effective observing and controlling.  Toyota initiated to export the new corona and corolla to Canada. After that its expansion has increased and it started to expand its business in United States. Toyota crown was one initiate Mosel which has arrived in United States. According the development of its business in Thailand automobiles market, Toyota started joint venture with one of the car manufacture of Thailand to become Toyota Motor Thailand. After getting success via joint venture, Toyota established its own assembly plant in Thailand where it produced various opportunities of job to the local indirectly (Kono, 2016).

When a company determines to expand its business globally, it is required to take its company’s business model apart and consider the impact of the expansion of global on every part of the model. For instance, in the context of its value proposition, a company must choose whether or not to transform the core strategies of company. It is the decision which is interlinked to of what marketers wants to enter in the foreign market and why. Decision need to be made about that how to organize and handles these efforts on global basis. The component of business model is value proposition, value chain infrastructure, market participation and management model. Value proposition is a business model which includes everything which can be offered to its customers in a specific market. The market participation dimension refers the specific market of a company to serve widely in abroad as well as domestically. It focuses the method of distributions and promotes it value proposition and promotion. The value chain infrastructure dimension deals with the question of that what key capabilities and resources are required to support the decide target market of the company. The sub model of global management describes the choice of the company regarding a suitable organizational structure of global and the policies of management. Competitive advantage has been increased due to innovation in business model (Huo, Qi, Wang, and Zhao, 2014).

Case study: KFC

Nestle is the world largest food and beverage company with more than2000 ranging of brands from global icons to local favorites. It is the leading company of the world for more than 140 years with the mission of “Good Food, Good Life”. The involvements of products in Nestle are dairy products, baby foods, snacks, breakfast cereals, tea and coffee, chocolates and Maggie. Nestle uses the strategy which associates the ration of amplify in income to utilize of food products. It defines that the person do not required consuming a lot of time to make food; they will automatically substitute for branded products. The strategy of nestle has been to penetrate emerging markets early prior its competitors and create a substantial customer as per selling products. Customization is considered as the major key to the global identity of Nestle which refers that Nestle uses local ingredients and techniques that sounds the name of brand that is identified globally.

Nestle has utilized it name of brand as strength to produce sales and to enhance its market share that involves customization of its products for getting fit in the profile of target market. As a strategy of penetration, Nestle used acquisition to enter in new international market. The implementation of the strategy is equivalent with the planning of the strategy which aims to execute locally. The growth of Nestle is done due to expand in Tomato Ketchup and noodles or tofu. Along with that the strategies of Nestle is enhanced into 5 countries such as Syria, Dubai, Turkey, Saudi Arabia and Egypt.

The first model of Nestle defines the design flaw and possible clarifications. In the first model of Nestle describes the flawed business design. To bring the competencies, Nestle focus on sales and marketing department. The second model of Nestle defines the “should be” design model which could be the clarification of the mentioned above model. Required competence, value proposition, distribution channels and customer segment are necessary for the success of the Nestle Company (Brouthers, 2013).

Ford is the multinational car manufacture company of America which headquarters is situated in Dearbon. Then global strategy of ford is increasing the demands of mobility environmental concerns, competition and strengthened expectations of customers. It is the company that provides global strategy summer intern opportunities and requirements for its employees. It provides the internship in the form of project oriented which should be able to deal with real problems and challenges in the business. Over the course it helps to understand its employees and interns to let them create a relationship of friends and attain exposure to managers of the strategy team along with enhance the learning skill in the experience of the culture of the ford industry. The business model of ford is unfolding. Ford started to import its compact transit connect with turkey in 2009.a subcompact model ford fiesta, is introduced in the market. In 2011, Ford changes the version of North American of the Ford with a European derived model. The customer service of Ford is considered as the legendary care. The plan of Ford brought various models in North America including B-max crossover which is based on the platform of the Ford Fiesta. The main aim of ford is one ford one team one plan and one goal. It follows this strategy and involves its employees in important decision and makes happier environment of the company through conduction various activities (Markides, 2013).

Case study: Toyota

It is the image which defines the entire plan of ford based on one team, one plan and one goal. Along with that the expected behaviors has been mentioned. It shows that the technical skills, value of customers and employees, results and the concept of working together.

Conclusion

It has been concluded that competitive strategy is very useful if company take it as per demand of the market and as per capacity of the company. It is the report which is made on the major two topics that target market and modes of entry and another topic is “global strategy as business model change”. Food and beverage industry as well as car industry has been taken in this report to fulfill the requirements of topic. It has been analyzed from this report that there is various ways of modes of entry but company should choose them as per preplanning and evaluation. As it has been observed that KFC has chosen franchise on the other hand the concept of modes of entry for Toyota is joint venture. It has been evaluated that the business model of Nestle and Ford Company is different so it is concluded that company should choose competitive strategy as per capability of the resources and financial situation.

References 

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