Marketing Entry Strategy International Expansion

Question: Discuss about the case study Marketing Entry Strategy for International Expansion. Answer: Introduction Corporations expand markets by use of various strategies, expansion can be domestic or it can be international in nature(Dev, 2007). International expansion can be achieved through multiple ways of distributorship, exporting, licensing, joint ventures, franchising and wholly-owned subsidiary. Some of the international expansion strategies are direct whereas others are indirect, each strategy has its own benefit and fallout. But corporations expanding directly internationally face several challenges which needs to be overcome. The report is regarding Rigel Technology which is a Singapore based company dealing with bathroom fittings and related products. The company wants to expand overseas into India hence is evaluating the various possible challenges and methods that can be adopted. India offers immense potential for expansion due to its demographics and robust population, it has a large consumer market and a rapid growing urban sector with real estate developments(Meyer, 2009). Company Introduction Rigel Technology (S) Pte limited is a Singapore based company set up in the year 1991. The company manufactures eco-friendly bathroom solutions based on latest technology in order to efficiently manage resources like water(Rigel, 2016). Rigel Technologies is a pioneer manufacturer of Sensor Sanitary Wares which enables water efficiency and advocacy in green building. There are three main categories of sensor valves produced flush valves for urinals and toilets, flow control valves for faucets. These valves are considered more hygienic in comparison to manually operated valves. The companys research and developmental facility is set up in Singapore itself, the company has marketing office in Malaysia and manufacturing plant in Luzhou and Ningbo in China. The company is present in Singapore, Malaysia, China, Vietnam, Indonesia and is currently planning to expand to India. Challenges of International Entry Rigel Technologies is trying to expand its operations to India with its diversified range of products. the sensor sanitary wares that the company is trying to promote in the Indian markets might encounter major challenges. India offers immense potential for expansion but there are certain challenges that the company needs to overcome in order to successfully establish its business operations. Some of the prominent challenges that the company might face in India are; Government: India is a democratic country with a stable government. The political structure in India is suitable for establishing businesses as norms and regulations are well laid down by means of various acts and rules. However, the country political bodies have high level of political interference in businesses(Singh, 2006). Especially in foreign business set-up there is immense bureaucratic control and discrepancies due to which many large venture have failed to establish their operation in the country. Rigel needs to apply proper channels for entering India such that it is successfully able to operate in the country. Social Cultural: India has a divide amongst the urban and its rural sector which is quite large. Though their has been significant shift from rural to urban population yet a major part of the countrys population is rural based. The urban population have adopted westernized styles and methods but rural India lags way behind in this field. In terms of sanitization certain parts of the countrys population have access to healthy sanitation and bathroom facilities(Kumar, 2006). Rigel needs to form its target market such that it is able to sell its products aptly. The concept of flush valves is relatively unknown in the major market segment and the company might face major barriers in marketing them. Competitors: India has a large numbers of competitors in terms of bathroom fittings and sanitary fittings. There are large small and medium scale enterprises in entire country that caters to its own niche segment. The large payers in the bathroom fittings and sanitary wares market are Jaquar, Grohe, Bharat Impex and so on. Rigel needs to adopt a suitable strategy such that it is able to establish a competitive edge in the country(Tej Adidam, 2012). But very few companies are offering sensor sanitary ware which will allow the company to have an advantage over its competitors. Recommendation Rigel Technologies in order to establish their business in India needs to overcome its existing challenges such that it is able to successfully achieve a competitive edge in the market. The following recommendations will enable the company to overcome the challenges faced in the markets of India. Rigel Technologies need to overcome governmental and political barriers, by applying for permission to operate in a legitimate manner. The company needs to adapt to the various norms, requisites and demands as laid down by the Chambers of Commerce for foreign operators. The company needs to maintain its motivation levels and follow the stages for application appropriately without ruling out any procedure. Rigel Technologies needs to design its products and solutions that can fit in the Indian scenario. Though the urban areas of the country where bathroom fittings are mostly used are at par with global standards but the fittings sizes needs to be appropriately designed and formed by the company such that local plumbers are able to fit them. Rigel Technologies can introduce its sensor sanitary ware products ata later stage of entering the Indian markets. Rigel needs to innovate new products that match the Indian markets, this will enable the company establish a competitive edge. Initially the company can export its products to Indian markets at a low price. The exported products from China will be generating considerable market for its products and at a low cost, as cost of production in China is relatively low. The company can introduce the sensor sanitary wares in the market which will provide it with an edge over competitors. This will enable the company create a substantial market and establish core competency in Indian market, the company will also be able to make its brand presence felt through this technique. Entry Mode Rigel can enter India through the various entry modes available, but it needs to select the mode that aptly can be suited for the company. The various entry modes available to the company are exporting, distributorship, licensing, franchising, joint ventures and wholly owned subsidiary. The company can initially enter Indian markets by exporting its products to the country through a reliable distributor(Cavusgil, 2014). Post the company sees a market for its product in the country it can select joint venture mode of entry where it will search a company with which it can collaborate. Through joint venture mode of entry the company will have significant learning of the Indian markets, consumer lifestyles, their demographics, choice of products and so on. Once the learning curve in Indian market is completed for Rigel Technology, it can strategies to form a wholly owned subsidiary in India(Demirbag, 2010). References Cavusgil, S. K. (2014). International business. Retrieved from https://www.prenhall.com/behindthebook/0131738607/pdf/CKR_Why_We_Wrote_This_Book.pdf: Pearson Australia. Demirbag, M. M. (2010). Perceptions of institutional environment and entry mode. Management International Review, Retrieved fromhttps://raijmr.com/wp-content/uploads/2015/08/3_16-21-Shilpa-Garg.pdf, 50(2), 207-240. Dev, C. B. (2007). Global brand expansion how to select a market entry strategy. Cornell Hotel and Restaurant Administration Quarterly, Retrieved fromhttps://scholarship.sha.cornell.edu/cgi/viewcontent.cgi?article=1769context=articles, 48(1), 13-27. Kumar, R. a. (2006). Doing business in India. Retrieved from https://www.palgrave.com/us/book/9781403967527: Palgrave Macmillan. Meyer, K. E. (2009). Institutions, resources, and entry strategies in emerging economies. Strategic management journal, Retrieved from https://eprints.lse.ac.uk/4217/1/Institutions,_resources_and_entry_strategies_(LSERO).pdf, 30(1), 61-80. Rigel, T. (2016). https://www.rigel.com.sg. Accessed on 25th July 2016. Singh, N. a. (2006). Political economy of federalism in India. OUP Catalogue, Retrieved from https://webcache.googleusercontent.com/search?q=cache:--9chrhSpNMJ:https://www.cesifo-group.de/portal/page/portal/968433589D2C0D9FE04400144FAFBA7C+cd=4hl=enct=clnkgl=in. Tej Adidam, P. B. (2012). Competitive intelligence and firm's performance in emerging markets: an exploratory study in India. Journal of Business Industrial Marketing, Retrieved from https://www.indus.edu.pk/publication/Publication-3.pdf, 27(3), 242-254.