The Business Environment and Industry Opportunities in Bahrain
You Are An Entrepreneur With a Medium-Sized Company In The Pharmaceutical Industry In Jordan Looking To Take The Opportunity Of New Growth In Two Emerging Markets Of Your Choice.
Due To Lack Of International Experience, The Firm Does Not Wish To Enter Both Markets At The Same Time. Your Task Is To Examine The Business Environments Of The Two Countries, And Advise The Company On The Following Strategies:
Which Country To Enter First, And Why And The Preferred Entry Strategy You Recommend. Justify Your Recommendation.
Being the entrepreneur with a medium-sized company within the pharmaceutical industry, I would examine some of the basic and helping business environments within the selected countries. In this report, the major concern is the determination of the business environment strategies that would be best to be selected by the company as it ventures its activities within Bahrain and Oman. Moreover, the report is aimed at identifying some of the specific strategies that would be recommended by the company as it enters the new business environment. The fact that this business lacks international experience especially operating in different countries it would be advisable to enter one country at a time. This is one of the best approaches that have been identified to be effective in this company as it will enable it to cope up with the new operations within those countries.
The government of Bahrain welcomes foreign investors with open arms because it is willing to boost its economy. The economic laws of this country are liberalized. The country has been passed and implemented the liberalized laws that support foreign property ownership and as well as reducing the issues of the corruption within the country (Root, 2014 p. 22). The country has come up with the anti-money laundering laws that ensure that there are no issues of corruption and discrimination of foreign investors. This one of the opportunities that the company should take into consideration to make sure it invests fully in this company. The country that supports foreign investors is the better opportunity that should be utilized by the companies willing to ventures their business in those countries. In this case, this is an opportunity for this company to choose this company as their new business environment. The country has no free zone issues of prohibitions and restrictions for foreigners willing to invest in their country (Hill, 2018 p.56).
The government is willing to boost the economy of the country by enabling as many foreign investors as possible. The country has 100% foreign ownership for all activities that the foreign businesses are willing to undertake (Rugman and Verbeke, 2018 p.819). Moreover, it allows about 30% as low as the operating cost of foreign businesses. This is one of the major opportunities that this company has to invest in Bahrain because it has all sorts of environmentally friendly conditions to start a foreign business (Lipson, 2011 p.875). The country is willing to boost its economy and this can be done by allowing many of the foreign business companies and organizations to invest in their country. Moreover, the country has eased the visa and immigration in favor of foreign investors (Van Tulder, 2014 p.49). Getting the work permits and visa to Bahrain is one of the simplest and fast processes that any business partner would wish to do. This is another opportunity that should be taken by this company to make sure that it acquires the work and business permit to operate in any part of the country.
The Business Environment and Industry Opportunities in Oman
Oman is one of the countries doing their level best to attract as many investors as possible. In 2017, the country invented the easy portal called a one-stop-shop which was targeting foreign investors into the country (Levinsohn, 2015 p.1339). The authorities of the country have been rolling some of the key reforms of the government policies to make sure that they favor foreign investors in the country. The government of Oman has simplified commercial transactions to favor foreign investors. Some of the governmental changes that have favored the investments of the businesses in this country include the establishment of new and simple new company registrations (Shan, 2016 p.292). This is one of the environmental factors that are favoring the company to invest in Oman. Moreover, the government has eased the amendments of the commercial names for foreign business operators willing to invest in this country. This is one major opportunity that this company should consider making sure that it can register the business under willing names for easy operation (Viswanathan and Dickson, 2017 p.46). Lastly, the country has eased the importation of the licenses for the purpose of surviving foreign investors abroad. This is another opportunity that this company should take into consideration to make sure it gets the licenses to invest in Oman.
The country that has been chosen to be entered first by this company is Bahrain. Bahrain is a rising nation in the Middle East, ready to develop and grow exponentially. Here are a couple of reasons as to why this country has been chosen to be entered first by the company. The traditions obligation in Bahrain is low, in this way supporting fare. The corporate arrangements in the country are business-accommodating. The lawful framework is clear and straightforward. The financial segment in Bahrain is creating at a fast pace, prompting propelled banking offices there. There is a huge extension of business development. The individuals of Bahrain are genial and the way of life is strong of mechanical development. Bahrain has a propelled framework, well furnished with courtesies to make it straightforward for organizations to be set up. Bahrain is the significant port center in the Middle East, giving advantageous access to all the Middle Eastern markets. The excitement and the travel industry in Bahrain are blooming each spending year. The personal satisfaction and assortment of nourishment in Bahrain are enticing (Kotabe, 2012 p. 92). Bahrain is presently a key player in monetary and banking administrations on the planet. Its key area between the east and the west and its progressed advanced media communications frameworks empower it to speak with all monetary and business focus during the day.
The Country is Chosen and Why
The permitting, guideline and supervision of investors who give venture and other monetary exhortation in or from Bahrain are likewise controlled. This shields financial specialists from the probability of carelessness or extortion. All You Need to Know for Starting a Business in Bahrain. You should have extensive information on the locale. The law necessitates that you have a neighborhood accomplice who holds most of the offer capital of the organization, and along these lines controls the business. Post your organization enrollment in Bahrain, the Ministry of Commerce ought to be discovered that you have in any event the base expected money to contribute. It makes sense that you counsel a neighborhood business guide from the beginning. An accomplished consultancy can manage you through the customs of organization fuse, and help in accomplishing your corporate targets, regardless of whether you want to shape a beginning up or a moderately bigger firm. While framing an organization in Bahrain, you may browse among the accompanying lawful elements.
The potential market entry strategies considered by the company are connected to the 5porters analysis. This theory analysis approach is applied in this case to make sure that the company is well competitive in the new country. Some of the strategies that the company would take as it enters the new market include the following.
The cost of the company products is supposed to be lowered to attract as many customers as possible. The cost of the product is one of the best methods that a company would need to focus on because by so doing it will attract a large volume of customers in this new environment (Peng, 2019 p.61). The customers are always willing to purchase the products at a low price but serving the same demands. This is one of the competition practices that the company would need to consider as it enters the new market (Thomas, 2010 p.429). Based on the 5porters analysis this strategy will boost the economic stand of the company as it is new in the environment. The fact that the company has got no much experience on the international basis, the low cost will attract a lot of the customers to buy their products on behave of the competitors. Endeavoring to be the business' general low-cost strategy is a ground-breaking aggressive methodology in business sectors with many value delicate purchasers (Xiaochuan, 2019 p.29). An organization accomplishes low-cost administration when it turns into the business' lowest-cost strategy instead of simply being one of maybe a few contenders with nearly low costs. A low-cost supplier's vital objective is to have lower costs than rivals on results of practically identical quality (Bonoli, 2010 p.435). In taking a consideration of low cost over competotors, company must take care to consolidate highlights and administrations that purchasers think about fundamental an item offering that is too decorations free attacks the appeal of the company product and can turn purchasers off regardless of whether it is less expensive than contending items. For the most extreme viability, a low-cost supplier needs to seek after cost-sparing strategies that are hard for adversaries to duplicate (Casson, 2015 p.292). At the point when it is generally simple or cheap for adversaries to copy the low-cost company's strategies, at that point any subsequent cost advantage vanishes too rapidly to increase a truly important edge in the marketplace. They're some of the shortcomings associated with this strategy. The company many undergo some losses because they may lower the cost of the products beyond the limits to suit their strategy. This moreover, the company may as well make a very small fraction of the profits because of choosing this strategy of lowering the price. It would be advisable if the company balance the price of the products with the original purchase of the same products (Buckley and Casson, 2018 p.539). Moreover, there could be rivals with competitor companies within a foreign country. The strategy of lowering the price may bring an issue of other competitor companies suing the new foreign company bin court of law for lowering the price beyond their standards.
The Potential Market Entry Strategies
This technique is accomplished by making an alternate item to different firms. This strategy will require the company to come up with products that are seen as "extraordinary" and "commendable" to clients (Morgan and Katsikeas, 2017 p.68). The benefit of this strategy is that it helps to accomplish an upper hand by making an item that clients see as one of a kind in some significant manner. A separated organization can charge an excellent value for the product they make. The other advantage part of this strategy is that Customers create brand dependability for an item (Stroh and Caligiuri, 2018 p.1). Some of the shortcomings associated with the Differentiation strategy are that it makes obstructions to section for different organizations. It also becomes hard to keep up uniqueness in the client's eye because other competitor companies may overcome this and make more interesting products.
The differentiation strategy is the most suitable to be chosen by this company as it enters a new market. Considering shortcomings associated with this strategy, it is a simple one to handle especially when dealing with foreign customers. Besides, the strategy forces both companies and competitors to improve the quality of their products (Alvaro, Joseph and Yadong 2010 p.139). This is one of the better ways to make sure that the customers are satisfied and maximum profit is reached by the company.
The most suitable entry strategy is the differentiation strategy because it will attract so many customers. The customers will be much interested in the new and unique product from this foreign company. The fact is that the customers are willing to test the new products. it would be advisable for this company to choose this strategy than lowering the price of their products. This strategy is advisable because it will lead to the maximization of the profits and scale of sale for the company.
I think it would be advisable for the company to choose to start entering Bahrain for its investments. This is because the government of this country supports foreign investors and therefore the business would not have political and economic challenges. The lesson learned in this report is that environmental factors are the key determinant of whether the company can thrive in a new environment or not. In this case, the country that supports the entry of foreign investors to boost their economy is a great opportunity to be utilized by the company willing to invest. Moreover, it has been learned that differentiation strategy is the most important and suitable strategy that should be chosen by this company because it will maximize the profit and increase the number of sales of the company. The low-cost strategy I think it is not a suitable one to choose because it may lead to some losses.
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