Transitional Exporting: A Case of Two Emerging Markets
Operating a business and not fully utilizing all of the opportunities proved to expand and secure the future of that business, will in time threaten the survival of that business. We are taken into the nation of Georgia which used to be a part of the former Soviet Union. Georgia lays at the crossroad of Western Asia and Eastern Europe and many important political and geographical decisions. Beqa, a Georgian man who resides in the capital of Tibilisi, has a vision to exploit the geographical location of Georgia and export commodities to its neighboring country Russia. Mineral water, apples, tangerines, and wine are all highly sought after in Russia but with insufficiently enough capital to invest, Beqa is forced to start with only one product, mineral water. Exporting the mineral water was running smoothly and the business was growing, within two years, Beqa was exporting mineral water, apples, tangerines, and wine on a regular basis to a variety of Russian customers. As time comes so does change and unfortunately political relations between Russia and Georgia escalated to the point of an embargo being imposed. Having only explored and tapped into the Russian market, Beqa had nothing to fall back on which almost crippled his own export business. The main problem facing Beqa and his export business to Russia is that the Russian Government imposed an embargo on all postal and transportation links with Georgia. The aim of the embargo was for Georgia to change its Western Foreign Policy Orientation and until then the embargo would stand. All of Beqa’s business is through the Russian market and with the embargo standing; Beqa’s export business took a critical hit that almost devastated its whole operation. All International businesses face political risk from either side of national markets they are catering too. Beqa was not thinking long term or about any other forces that might have an effect on his business....
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