Essay: Analysis Of Business Environment And Expansion Of TSA Pty. Ltd In Asia.

This assignment focuses on a fictional Australian engineering and manufacturing company called TSA Pty. Ltd. (TSA).  TSA is a global leader in the food packaging and processing industry, supplying turnkey solutions and single systems to customers around the world.  Your task will be to familiarise yourself with the company and then investigate and comment on specific questions relating to the company’s international operation and expansion.

It has been suggested to Ald Wood that new developing economies emerging in Asia   would be attractive new markets for TSA. 

1. Carry out a preliminary analysis of these potential markets to determine the country that will be the best choice for the company. The analysis has to present relative advantages and disadvantages in terms of their market profit potential, for at least 2 Asian countries (of your choice).

1. Taking in consideration all factors you are aware of, outline the main risks associated with these two potential markets. For each group of risks (e.g. Financial, Political, Environmental..,) use historical data (1980-2018) and current situation to predict expected number of events that can affect the TSA business in the next 5 years (e.g. ones per year, twice in five years …).  Also for the chosen events analyse the consequences on the TSA business (e.g.  Cancelling Business in the country; Significant loses; TSA have to perform short brake; Minor Problems; Business is not affected).  

For the severity of the problems you can use the scale 0-5 or similar.  It is highly recommended to use Tables for the presentation.  

1. Based on your analysis of the market potentials and known risks, make an initial recommendation:

Which one of these markets would provide the best option for TSA and identify any other information that you feel would be required to finalise a decision. Recommend some action that you might take to improve the sales and marketing in those countries. Your work should be presented in a report of approximately 3000 (-10%  +50%)  words in length. 

Please Note

• The country is fictional and similarity with real world company is accidental
• Your report needs to be clearly written, well-structured and well presented. You should acknowledge all sources used and provide references where appropriate.  References must be presented in approved standard form (e.g. Harvard) and the reference list presented alphabetically by author.  Please note that the software program Turnitin may be used in assessing your assignment. Before the due date you can upload up to the three times into Turnitin, for checking the score.

TSA Pty. Ltd

The processes of internationalization and globalization have much changed the business world in the present times and at the same time offer diverse kinds of business opportunities to the different business enterprises (Penrose 2017). However, the effective utilization of their business opportunities depends to a large extent on the capabilities as well as the core competencies of the business enterprises (Shenkar, Luo and Chi 2014).

In this particular context, it becomes all the more important for these business enterprises to conduct a thorough analysis of their own organizations which is not only likely to offer them a pertinent insight into the key strengths as well as the weaknesses of their organization but at the same time to conduct a thorough business environment analysis as well (Forsgren and Johanson 2014).

The diverse kinds of business environment analyses provides an insight to the organizations about the key factors that the concerned organization needs to take into effective consideration for the process of their business in the business market of a particular nation (Forsgren and Johanson 2014). This is important since in the present times it is seen that the business markets of the diverse nations are greatly different from each because of the differences in the political, social, technological and other factors which affect the process of business of the diverse organizations.

The diverse business environment analyses are thus conducted to get an idea about the important factors which are likely to affect the process of business of a particular organization (Cavusgil et al. 2014). This is important since having a clear idea about the diverse factors that the organizations need to deal with or rather have to take into effective consideration provides them with the opportunity to devise effective tactics or strategies which are likely to help them not only mitigate their adverse effects but at the same time to capitalize on the opportunities in the most effective manner (Cavusgil et al. 2014).

This report will discuss about the concept of international business environment in the light of the organization TSA Pty. Ltd and their intended business expansion into Asia. The report will analyze the business environments of the nations of Pakistan and India and based on the analysis will propose the nation which can afford the maximum amount of benefits to the concerned organization on the score of its expansion into it and will at the same time analyze the business risks involved in the process.

Indian Business Market Analysis

TSA Pty. Ltd

            The company TSA is one of the global leaders in the genre of the food packaging industry and is known for the innovative use of the packaging system for the process of its business. The company was established in the year 1982 through the cumulative efforts of Ald and Nataly Wood. The original idea for the business was developed by Wood and the idea was converted into a success business venture through the hard efforts of both the co-founders of the company.

The organisation under discussion here has an interesting history and it is interesting to note that initially the concerned organisation focused on the manufacture of packaging materials. However, the engineering educational background of Wood acted as a boon for the concerned organisation since it was he who came up with the innovative idea of the use of the modern technology for the packaging of the food materials offered by the food industry of the present times. The organisation soon set out to implement the innovative idea of Wood however initially it was not a very successful one because of the lack of technological expertise of the people. However, over the years the organisation soon overcome this particular technological barrier and has been able to gain a significant amount of success.

            The organisation had its humble beginnings in the city of Sydney however within a very short time by virtue of the innovative strategies followed by the co-founders the organisation was able to gain a significant amount of success. It is a reflection of this particular fact that the organisation under discussion here is currently operational in the majority of the nations of the world and is planning to expand even further. Furthermore, the organisation currently is one of the highest revenue earning ones within the industry and holds a complete monopoly over the concerned industry.

Indian Business Market Analysis

            India is a developing nation and in terms of the business market offers diverse kinds of marketing opportunities to the various business enterprises of the world (Cravino and Levchenko 2017). However, to exploit the marketing opportunities afforded by the business market of the concerned nation the concerned organisation would at the same time have to take into effective consideration the diverse factors which affect the business world of the concerned nation (Hovhannisyan and Keller 2015). A PESTLE analysis of the business environment of the concerned nation would reveal insightful information about the factors that influence the business world of the nation.

PESTLE Analysis of India

PESTLE Analysis of India

Political Factors

            The nation of India follows a democratic system of government and the Prime Minister of the nation governs the nation on the behalf of the people of the nation (India.gov.in 2018). The nation is as such free from the diverse kinds of political turmoils however there are instances of violence, political struggles and others which can adversely affect the prospects of the various business enterprises in an adverse manner and thereby reduce their profitability (Hyder and Lussier 2016).

Furthermore, the national government of the nation takes active interest in the promotion of trade and commerce and tries to offer the kind of support as well as facilities to the diverse business enterprises of the nation which help them to carry on trade and commerce in a peaceful manner (Hyder and Lussier 2016). The net result of these initiatives on the part of the national government of the concerned nation is the fact that in the recent times various successful business enterprises of the world have expended into the business market of the concerned nations and are utilising the business opportunities afforded by the business market of the concerned nation to earn a higher amount of profit.

Thus, it can be said that the political landscape of the nation of India actually acts as an opportunity for the business organisation TSA since the concerned organisation can utilise the congenial political landscape of the nation of India to not only further the prospects of their business but at the same time to earn a higher amount of profit as well.

Economic Factors

            The nation of India is a developing one and has a mixed economy which is dependent not only on the diverse business enterprises of the nation but also on the agricultural system of the nation as well (India.gov.in 2018). Furthermore, the economy of the concerned nation is the 6^th largest one of the world in terms of the nominal GDP and the 3^rd largest one of the world in terms of the purchasing power (India.gov.in 2018).

In addition to these, the stability of the economic framework of the concerned nation is also being reflected in the fact that the economy of the nation was only slightly or marginally affected by the global economic recession that the world recently faced. Furthermore, the concerned nation has active relations with the diverse Commonwealth nations and the other Asian nations (India.gov.in 2018). Thus, it can be said that the economic condition of the nation acts as an opportunity for the concerned nation which it can utilise in an effective manner so as to increase its profitability. Furthermore, the stable nature of the economy of the nation at the same time means that the company is likely to find a stable business market in the concerned nation.

Challenges and Opportunities in Indian Market

Social Factors

            Food forms an important part of the social life of the people of the nation under discussion here and it is seen that the people of the nation like to bond over food. At the same time it is also seen that the people of the nation like to order different kind of foods from the diverse food outlets (Bader and Schuster 2015). Thus, it can be said that the social landscape of the nation of India is likely to act as an opportunity for the organisation under discussion here. The organisation under discussion here can enter into diverse kinds of collaborative relationships with the various food companies of the nation for the packaging of the food items offered by them to the people of the nation.

This is likely to benefit both the food companies that are manufacturing the food items and at the same time would benefit the company under discussion here by offering them the chance to use their expertise in an effective manner (López?Duarte, Vidal?Suárez and González?Díaz 2016). Furthermore, this is likely to not only help the concerned company to earn a higher amount of profit in the nation of India but at the same time would help them to have better prospects of growth.

Technological Factors

            The nation of India is not a highly developed in term of technology and it is seen that the majority of the business enterprises of the nation in the absence of better technological resources are still resorting to the use of the outdated as well as obsolete forms of technology for managing the diverse affairs of their business (Ahmed et al. 2016). Furthermore, the diverse organisations of the nation in order to overcome this particular problem are taking the help of the process of outsourcing and also entering into effective collaborations with the business enterprises of the other nations of the world (Ahmed et al. 2016).

A typical example of this trend is seen in the expansion of the business of the company Tata Steel into the business market of the United Kingdom (Ahmed et al. 2016). This particular factor of the nation acts as a threat for the concerned nation since it will have to take the help of the technological advancements of its own parent nation for the process of the management of the affairs of its business in the nation of India. In a way it can be said that if this particular aspect of the nation of India is not taken into effective consideration by the concerned business enterprise then it can significantly affect the amount of revenue or profit earned by it in the concerned nation.

Pakistani Business Market Analysis

Legal Factors

            The legislation of the nation of India has been designed in such a manner that the business enterprises of the concerned nation are being able to conduct their business in a smooth as well as effective manner (Taneja et al. 2015). This is important since effective as well as congenial legislations are one of the key requirements of the business organisations and thus it can be said that the legislative framework of the nation acts an opportunity for the organisation under discussion here (Taneja et al. 2015). Thus, it can be said that the effective utilisation of the legislation factors of the concerned nation would help the organisation to earn a higher amount of revenue.

Environmental Factors

            The nation of India is an active supporter of the Paris Agreement of 2016 and thus the diverse organisations of the nation are required to reduce the amount of pollution caused by them by almost 2% (India.gov.in 2018). In addition to this, there are other legislations as well as regulations that the diverse organisations are required to follow for the process of their business in the nation of India. This is likely to act as a threat for the company under discussion here since the effective following all these regulations are likely to reduce the profit margin of the concerned nation in a significant manner.

Business Market Analysis of Pakistan

PESTLE Analysis of the business environment of Pakistan

Political Factors

            The political landscape of the nation of Pakistan is a very unstable one and the end result of this particular aspect is the fact that the diverse business enterprises find it very hard to sustain themselves in the nation (Jamil et al. 2016). Furthermore, although the nation follows the democratic system of government it has been subjected to military and also dictatorial rule in the recent times (Jamil et al. 2016). In addition to these, terrorism is another common problem that the nation has been facing for a very long time (Jamil et al. 2016). The nation has been subjected to diverse kinds of political turmoils in the recent times. Thus, it can be said that the political landscape of the concerned nation acts as a threat to the concerned organisation and can significantly affect the profit margin that they are likely to earn in the business market of the nation.

Economic Factors

            The economy of the nation is a very unstable one because of the turbulent political conditions of the nation (Bilal, Khan and Akoorie 2016). Furthermore, because of the diverse kinds of terrorist activities the nation does not have effective economic relationships with the diverse Commonwealth nations (Bilal, Khan and Akoorie 2016). Thus, it can be said that the economic landscape of the nation acts as a threat for the concerned and can significant affect the financial prospects of the concerned organisation in the nation.

PESTLE Analysis of Pakistan

Social Factors

            The people of the nation are food loving and bonding over food forms an integral part of their social life (Bader and Schuster 2015). Furthermore, there are diverse kinds of food companies in the nation that regularly need the help of the packaging services that are being offered by companies like TSA. Thus, it can be said that the social landscape of the nation acts as an opportunity for the concerned organisation which if utilised in an effective can significantly help in the financial growth of the organisation under discussion here.

Technological Factors

            The nation of Pakistan is an under developed one in terms of technology and the diverse organisations had to use the technological advancements of the other nations for the process of their business (Morschett, Schramm-Klein and Zentes 2015). Thus, it can be said that this particular factor acts as a threat for the concerned organisation and can significant affect the revenue that they are likely to earn in the nation.

Legal Factors

            The government of the nation takes active initiatives for the growth of trade within the nation however because of the absence of a strong national government these legislations and regulations are rarely followed (Sassen 2016). This has affected the prospects of the business enterprises of the nation in an adverse manner. Thus, it can be said that this particular factor acts as a threat for the concerned organisation and can adversely affect the prospects of their business.

Environmental Factors

            The national government of Pakistan requires the diverse organisations of the nation to follow various kinds of environmental legislations however in the absence of a strong national government these legislations are rarely followed (Deresky 2017). Thus, this acts as an opportunity for the concerned organisation since it will not have to worry about the environmental legislations for the conduct of its business in the nation of Pakistan.

Analysis of risks in the business market of India

Analysis of risks in the business market of Pakistan

Recommendation

The analysis of the business markets as well as the risks that the organisation is likely to face in the business markets of the two nations clearly shows that the nation of India is more suitable to the business of the concerned company. The Indian business market is more suitable for the business of the concerned organisation and at the same time it also poses a relatively lesser amount of risks for the business of the concerned organisation.

Challenges and Opportunities in Pakistani Market

The sale of the services offered by the concerned company could be increased in an effective manner through the use of an adequate marketing mix which would be based on the business market of the nation. Furthermore, the pursuit of effective promotional strategies would also help the concerned organisation in a significant manner. The use of the cost leadership strategy would at the same time boost the sale of the packaging services offered by the concerned organisation.

Conclusion

            To conclude, the business organisations for the process of the business in a particular nation need to take into consideration diverse factors like the political, technological, social and others of the concerned nation. In addition to this, if a particular business enterprise is planning to expand into the business market of a host nation then it needs to conduct a thorough analysis of the conditions that it is likely to face in the business market of the concerned nation. Furthermore, an analysis of the potential risks that it is likely to face in the concerned nation would also be helpful.

This can not only help a particular organisation to save a significant amount of their capital as well as resources but at the same time would provide them with an idea about the conditions that they are likely to face in the business market of a particular nation. Thus, it can be said that a thorough market as well as environment analysis is one of the prerequisites for the various organisations which are planning to embark on the process of international expansion.

References

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