Case study arcelik
1. Arcelik has been very active in Western Europe. Do you expect Arcelik's prospects to be better in emerging market and developing economies than in advanced economies? ln what ways are emerging market and developing economies attractive to Arcelik? ln general terms, how can the firm reap benefits from such markets in order to maximize company performance?
The risks in international business are country, currency, commercial and cross-cultural risks so they should all be considered when entering a new foreign market. The advanced market has less population but the per capita income average is way higher than in the other markets. Emerging markets have most population and middle capita income when the developing markets have less per capita income and also less people than emerging market. The trade volume is high both in advanced and developing markets, where as in emerging it’s low. Education level is high in advanced, moderate in emerging and low in developing markets. Trade barriers are also minimal in advanced, rapidly liberalizing in emerging and moderate to high in the developing market. Industry is poor in developing markets and improving in emerging markets as well. Country risk is low in advanced markets, variable in emerging and usually pretty high in developing markets.
Emerging and developing economies are more attractive to Arcelik due their high population, more customers, fast-growing competition, increasing urbanization and low competition. These markets usually have also low cost labor and the industrialization is increasing as well as the development in general.
The benefits for advanced markets are that the population is well educated, they have high income so the companies can gain high profit margin in most cases. Also the industry is already saturated. In emerging and developing markets the cost of labor is low, but the people also have low incomes. Though, the per capita income is increasing rapidly so it should be adjusting cost and
The risks in international business are country, currency, commercial and cross-cultural risks so they should all be considered when entering a new foreign market. The advanced market has less population but the per capita income average is way higher than in the other markets. Emerging markets have most population and middle capita income when the developing markets have less per capita income and also less people than emerging market. The trade volume is high both in advanced and developing markets, where as in emerging it’s low. Education level is high in advanced, moderate in emerging and low in developing markets. Trade barriers are also minimal in advanced, rapidly liberalizing in emerging and moderate to high in the developing market. Industry is poor in developing markets and improving in emerging markets as well. Country risk is low in advanced markets, variable in emerging and usually pretty high in developing markets.
Emerging and developing economies are more attractive to Arcelik due their high population, more customers, fast-growing competition, increasing urbanization and low competition. These markets usually have also low cost labor and the industrialization is increasing as well as the development in general.
The benefits for advanced markets are that the population is well educated, they have high income so the companies can gain high profit margin in most cases. Also the industry is already saturated. In emerging and developing markets the cost of labor is low, but the people also have low incomes. Though, the per capita income is increasing rapidly so it should be adjusting cost and