Giant Bicycles to S. Korea

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Giant Bicycles Penetrate S. Korean Market
Executive Summary

In order for Giant Manufacturing Co. to continue on its current growth path, we have evaluated emerging markets for Giant to sell their high-end TCR racing and mountain bikes. After an in-depth analysis, the South Korean market appears to be the most attractive investment with the lowest risk.

Expansion into the South Korean market would build upon Giants current expansion strategy in Asia. Giants has executed the first phase of their plan by establishing an industrial presence in China and creating a strong foothold in the market, and now plans to expand to surrounding Asian markets. Giant should leveraging China’s healthy trade relationship with South Korea and penetrate the new market, consistent with Giants strategy.

There are many characteristics of the Korean market that make this expansion a smart investment. Most importantly, South Korea’s stable economy can support the price of our high-end product. Their average income is the highest out of all countries evaluated, supplemented with strong economic growth over the past five years. On top of significant public wealth, the government has made a commitment to invest in infrastructure to increase the use of bicycles. South Korea also has the largest number of professional bicycle associations. These factors suggest that the current market conditions will support Giant’s product and that the future will only improve bicycle demand.

The competitive situation is favorable for penetration into the South Korean market. Cannondale is currently the only competitor that is present. Giant prefers following a competitor into a new market, letting them invest to establish the high-end bicycle product. After the market has been established, Giant will use their strong competitive price position to enter the market and steal significant share.

A major hurdle for Giant to overcome is establishing a strong relationship with the...
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