1) Market Drivers (High pressure for local responsiveness) -There are differences in demand pattern across different countries. Consumption habits are heavily influenced by culture, tastes, demographics etc. For example, In US, diets trend made people avoid both trans-fats and carbohydrates. (High Pressure for responsiveness) -Per Capita Consumption of products varies among different countries (Pressures for responsiveness) -There are differences in dominating distribution channel (i.e. mom & pop stores, hyper market) across different countries (High Pressures for responsiveness) -There are few global customers.
-Advertising and promotion should be different among countries.
2) Competitive Drivers (Medium-High pressure for local responsiveness) -There are differences in industry concentration across countries. For example, in Mexico, baking industry is highly concentrated whereas US market is fragmented and very competitive. -The level of globalization of competitors is low. Every country and market has different players. (Pressure for responsiveness, low pressure for integration)
3) Cost Drivers (Low-Middle pressure for global integration) - Potential for economies of scale is not huge
(Low-middle pressure for global integration)
-Baking industry is not R&D intensive products
(Low-middle integration pressure)
-Labor cost varies among countries.
4) Government Drivers (Medium high Pressure for responsiveness) -Regulatory frameworks vary among countries for labor relations.
=>Overall: High pressure for local responsiveness and low pressure for global integration
(a) Bimbo’s international strategy is based on Multi-domestic strategy (high responsiveness and low integration). In the baking industry, a high level of local responsiveness is required to deal with different customer’s demand. When Bimbo moved into international market, it preferred to continue developing the local brands acquired due to well known brand names. Also, Bimbo...
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