Global & International Business an Analysis of South African Food Retail Industry

Topics: Management, Strategic management, Supply chain management Pages: 13 (3229 words) Published: January 19, 2013
Table of contents
Expansion opportunities for the company:4
Demand condition:4
Factor endowment:5
Related and Supporting Industries:7
Firm Strategy, Structure, and Rivalry:7
Government and chance:8
Contemporary Management Issues:9
Cultural diversity:10
Supply chain management:11
Market entry strategy:13
Direct export/aggressive export path:13
Strategic alliance with regional company:15


Globalization is a complex process. (Shumate et al, 2005) An organization needs to have thorough analysis of global market while expanding its services beyond its regional border. (Doole, Lowe, 2005) However, the process becomes more complicated when it becomes expansion of services within a specific region. This thing is ample difficult and needs conducting market research in order to gain complete information about that relevant market and assume strategic plan accordingly. (Percy, 2012)

This report also throws light upon different aspects which should be taken under consideration while expanding business beyond the borders. This feasibility report gives not only general overview of South African food retail industry, but also scrutinizes the opportunities which this organization would have while expanding its services from UK to SA. The first part of this report will give overview of the African markets from different perspective. The second part throws light upon two management issues and the third part suggest a strategic plan along with few recommendations that can be implemented in order to get successful position in South African market.

Expansion opportunities for the company:

Contemporary markets are considered ample competitive and an organization can achieve high level of success only through gaining competitive advantages. (Dabbah, 2010) Global expansion makes this competition factors ample diverse and intricate. So, before expanding the organization to South African food retail industry, it is mandatory for the organization management to scrutinize each factor that can contribute in achieving competitive advantages.

Basically, competitive advantage is referred to the advantage that is gained through having strong competition with rival company and overpowers it through adopting an appropriate strategic plan. (Rolstadås, 1995) However, in this regard, strategic plan plays a major role but there are additional factors that should be taken under consideration while making an appropriate strategy for South African business expansion and these factors can be analyzed using Porter’s National Diamond Model. Each aspect of PND would be scrutinized from the perspective of South African retail food industry and source of competitive advantages would be pointed out.

Demand condition:

The first factor promulgated by Porter indicates the demand condition of the product or service. However, before applying this analytical aspect, it is mandatory to scrutinize the actual meaning of this competitive analytical tool.

Basically demand condition enables the organizations to comprehend the demand of the customers and determine whether the product is demanded by the customer or not. (Peng, 2008) For this purpose, the product analysis is done in domestic market instead of foreign market since local companies pay more attention towards developing and sustaining the product instead of foreign firms which gives competitive advantage to local firms and they bean to export that demanded product. This thing cause trend setting and further predicts global success. (Traill, Pitts, 1991) In this way, the organizations can not only gain advantage on national level but also international level as well.

As far as South African retail food industry is concerned, this is a tourist favorite region and most of its parts are holiday places which is the positive factors for an organization already established in UK that is also tourist...
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