The endless summer of the late 1960s, surf scene was very small however according to Hamish Fitzsimmons (2004) surfing has come a long way since that period, the sport exploded in popularity in the 1960’s as surf boards became lighter, smaller and cheaper. Murray Walding (2008) states that “up until that stage it had just been essentially a small cottage industry with occasional forays into marketing things like surfboards, t-shirts and wetsuits, and I think it went along fairly smoothly, a nice sort of logical progression until the mid-80's, when there was a huge boom in the surfing industry”. It was during this time when Billabong had strongly secure its place in Australian surf culture and Gordon Merchant (founder of Billabong) was prepare for international expansion, witnessing sustained growth of a $14 billion global industry dominated by three companies - Billabong, Ripcurl and Quicksilver – all founded in Australia (Robbins, S, Bergaman, R, Stagg, I & Coulter, M 2009).
External environment factors play a vital role for managers as it benefits them to create a successful strategy for its company. For instance, part of the Billabong's long-term goal will be the exploration of business opportunities in China, following distribution in Hong Kong, Indonesia and Singapore. Majority of the Billabong group’s supply chain has close ties therefore its based in Hong Kong, allowing relatively smooth transition in the region for the company (Oxenbridge 2007)
Billabong International CEO Derek O'Neill says China presents a unique challenge in pitching a quintessential Aussie board short brand to a predominately conservative culture. Mr O'Neill (2007) says "Our biggest challenge is going to be 'how do we get the message across' of the brand, what it stands for and what vehicle we will use to tell that message,"