Global market entry issues and strategies
These figures indicate how powerful Zalando is in terms of sales prospects. The growth story of Zalando according to the Kinnevik’s capital market of 2014 indicates a flourishing fashion industry with a great future prospectus. The products that Zalando offers ranges from shoes, fashion accessories, and other fashion related products. The products they offer makes Zalando to be a great fashion destination to go to Europe. It has won the company a great reputation for becoming Europe’s number one priority for the leading business company. As a matter of fact, Zalando’s expansion can be easily understood by looking at their sales forecast and development over the years. In the year 2013, more than 60 percent of their sales prospects was generated on its offshore branches such as Germany, Austria, and Switzerland.
This is a clear indication that the company can have a great market leader when other offshore target markets are established. This report seeks to understand some of the key developing marketplaces across the world. The overseas market considerations have a great reputation of being the greatest fashion markets of all time; Egypt, Turkey, and the UAE (Herzfeld, and Weiss, 2003 p. Targeting this place will provide a wide range of resource base that will enable Zalando effectively generate more supplies across the regions. Market Egypt, Turkey, and the UAE are known to be great supplies of fashion accessories serving many countries across the world. The demand is ever growing considering the ever-developing economies across borders. The market size, on the other hand, is expanding drastically and more product expansion is being advocated.
The demand for the product in these nations is with no doubt great and the target is in line with the policies and anticipations of Zalando (Alesina, 2009 pp. With such an approach, they will be able to effectively overcome key milestones and challenges that restrain most of their success story. The bargaining power of the suppliers and customers should also be another important consideration that will enable the company to thrive through the competition. A great bargaining power will determine the market penetration in a manner that key aspects about the market will be accomplished in due course. It will also be easy to overcome great proponents that will give the industry a great penetration and overcome great competitors offering the same product.
For a great business to succeed there should always be a tight competition and this is a great understanding that the industry understands. In fact, the development of the nation has been possible with less or no form of threats and attacks. It is very rare to see terror attacks in this nation. This is due to the structure and the political climate of the country (Alesina, 2009 p. The nation has maintained peace for many years and offers a great business environment. The same case applies to Egypt and Turkey who have the great political arena than any other nations in the world. When the buyers are much unwilling to take the outlined price, it will definitely drift the prices down.
Buyer power is, therefore, a great way to overcome purchase problems (Dobbs, 2014 p. The threat of substitution is another key factor that should be considered in the three nations. It determines the way in which the product can dormmate or eventually lose popular sales due to the existence of other related product. Finally, the threat of entry of new competitors is a great concern to Zalando. Meeting the market demand is a great way to make sure all resources have the right prospect and that the right considerations have been outlined in due course. Technology and Quality Control Zalando has to have the great reach of technological control to make sure that they remain in touch with the given technological progress.
Establishing a joint venture with other industries within Egypt, Turkey, and the UAE is a great way to control technology and the quality being delivered. Market entry requires a company to first understand the technological trends of a particular target market. For Zalando to be able to understand the trends in Egypt, Turkey and the UAE, they ought to establish a joint venture with an existing business. Political climate might restrain the establishment of the industry in the manner that key considerations will not be considered in due course. The entry speed of the establishment can be terminated by the risk factors established. When the economy is not stable, it might cause harm to the business at the start. It is necessary to make a clear analysis of the performance of the business and the possible prospects of how the business will be performing at an anticipated later period (Everett, and Watson, 1998 p.
This will give a great guideline and direction that leads in the creation of the industry in the given timeframe. External Factors On the other hand, external factors can also have an impact on the business. The external factors such as the size and growth of foreign markets can affect the establishment of Zalando in the regions. Foreign markets determine the development of new markets in locations which are not common to them. The country of establishments can also be encountering financial and economic shocks which might just turn out to be the beginning of problems. These factors should always be factored out before the decision of establishment of the new industry is made (Duffy, 2003 p. Zalando with its expounding business prospect is in a position to effectively target the regions and come up with a great business that will be used to effectively change the different prospects through the business.
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