1. Company Background 2. Scope of Business & Reason for International Operation
3. Strategic Goals & Choice of Entry Mode
4. Alternative market entry modes 5. Problems and challenges associated with different entering options in different location 6. Conclusion 7. Reference
Watson's (Your Personal Store) or Watson's is part of the Health and Beauty retail and consumer division of the Hong Kong-based A.S. Watson Group
1828 Open a canton Dispensary in Guangzhou, China 1841 Operations extended to Hong Kong and founded Hong Kong Dispensary
1851 Dr. Alexander Skirving Watson joined the company as a Manager 1862 Name A.S Watson began to significantly outstanding its business … Present Located 10,000 stores worldwide, presence in 33 operating markets over the Asia & Euro Countries.
Scope of Business
Main Scope: Retail & Manufacturing
spans health & beauty chains, perfumeries & cosmetics, grocery, consumer electronics, wine, and duty-free
Health & Beauty Division
A.S Watson Group
Food & Electronic & GM division
World’s largest health & beauty retailer Asia's leading health & beauty retailer. Asia Watsons Nuance-Watson Europe Kruidvat Trekpleister ICI Paris XL Rossmann Superdrug Marionnaud Drogas The Perfume Shop Asia ParkNShop Fortress Watson’s Wine Cellar Great Food Hall TASTE Food Galleria GOURMET Boutique style Find food hall Asia Watsons Water Mr Juicy Sunkrist Juices Shanghai Sparkling Watson’s cordials Cyrstal Spring Teas Watson;s Sarsae Europe Powwow Aquad’or Aqua System Selda/Bebagua Mistral Vimax
Expending to mature potential market (High growth potential countries…)
1) Mix of Market Penetration (expend network into existing market)
2) Market Development (Internationalization)
Reasons for international operation
Growth Watson look to international markets for growth. Introducing new products internationally can expand a company's customer base, sales and revenue.
Employees Watson go international to find alternative sources of labor. Watson look to international countries for lower-cost manufacturing, technology assistance and other services in order to maintain a competitive advantage.
Resources Watson go international to locate resources that are difficult to obtain in their home markets, or that can be obtained at a better price internationally.
Watson go international to broaden their work force and obtain new ideas. A work force comprised of different backgrounds and cultural differences can bring fresh ideas and concepts to help a company grow.
Watson go international to diversify. Selling products and services in multiple countries reduces the company's exposure to possible economic and political instability in a single country.
Reasons for entering Malaysia Market
acquisition of Apex Pharmacy Sdn Bhd (Apex Pharmacy) from Apex Healthcare Bhd (AHB), a Bursa Malaysia main board-listed company strategic move to further strengthen Watsons retail presence in health and beauty in Malaysia strategic move will strengthen our presence in Malaysia by expanding the total number of Watsons stores to over 100, resulting in an immediate and significant growth in our market share benefit consumers through competitive pricing and a wider selection of merchandise, made possible by the greater economies of scale
Choice of Market Entry Mode (Foreign Acquisition)
Access to target’s local knowledge
Uncertainty about target’s value
Difficulty in “absorbing” acquired assets
Control over foreign operations
Control over own technology
Infeasible if local market for corporate control is underdeveloped