In this paper we shall analyze the case of the company producing refrigerators called Kool Kitchen. As the director of international marketing for Kool Kitchen, I am evaluating a Western country - Cyprus, and an Asian country - India in order to expand there. This will likely be achieved using analysis tools such as PESTLE examination and also by recognizing and analyzing the Opportunities and Dangers for Kool Kitchen in each country.
Kool Kitchen was founded in 1997 in London, U. K. by SOMEONE IN PARTICULAR. Kool Kitchen is a making company for kitchen appliances such as refrigerators, freezers, ovens and dishwashers and washers, but is primarily known for refrigerators. It is currently one of the primary refrigerator making companies and quality pioneers in the U. K. with prices ranging from medium to top class. In addition to the United Kingdom, the company has also expanded in Ireland and France and is currently checking out opportunities in Asia and European countries (India and Cyprus respectively).
How to judge the two countries
When companies want to globally extend their activity, it is very important they are doing some market research and environmental research (Zekiri and Angelova, 2011). To carry out that, they need to follow the PESTLE research model and area of the SWOT examination (only Opportunities and Threats).
PESTLE means for Political, Economic, Sociological, Technological, Legal and Environmental and the ones words symbolize the factors that constitute the research method. PESTLE research is a useful method for evaluating and understanding the environment within that your organization is functioning, the risks that exist in the market and the probable of the business (Morrison, 2010a).
SWOT analysis is a tool used to apprehend the Strengths, Weaknesses, Opportunities and Hazards that are involved in a company. The advantages and weaknesses are internal factors to the organization, negative and positive (or potentially negative) respectively, whereas the opportunities and talents are exterior factors, beyond the organizations' control (Morrison, 2010b). All four factors must be taken into consideration when an organization wants to achieve certain objectives, in order to make the right decisions and pursue the correct path. In this newspaper we will only concentrate on Opportunities and Threats that every country presents for Kool Kitchen since our company is evaluating the factors external to the organization.
PESTLE examination for Cyprus
Cyprus has a certain politics stability, but the island is divided in two since the Turkish invasion in 1974. The north part of Cyprus is currently occupied by the Turks. In 1983 the Turkish occupied area announced itself "Turkish Republic of Northern Cyprus" but it is only recognized by Turkey. Really the only widely recognized talk about is the Republic of Cyprus. (CIA Factbook, 2012). There is still Turkish military occurrence in the occupied area of the country which accounts for a certain menace.
Despite its own political balance, Cyprus is geographically placed very near to Egypt, Israel and Lebanon, which is a very unstable region, often placing Cyprus in a compromised position as well.
Cyprus has joined europe (European union) along with nine (9) other countries in 2004 within the widening of the EU. Therefore, ever since, trade with other countries within the European Union has been easier.
Cyprus is currently deeply influenced by the global monetary crisis mostly due to economical situation in Greece. Cyprus comes with an immediate marriage with Greece: two of the biggest banking institutions in Cyprus are one of the major holders of Greek bonds in European countries and the first country Cyprus imports from and exports to is Greece. Further to the earth financial meltdown, an explosion in July 2011 at a naval bottom caused ability outages from coast to coast, thus triggering a collapse in the coalition federal and further economical problems.
The CIA Factbook claims that regarding to estimations in 2011, 10. 2% of the country's exports and 9% of the country's imports are done with the United Kingdom, thus making the U. K. the 2nd biggest export partner and the 3rd biggest import spouse for Cyprus.
Although the Cypriot economy is in downturn and the consumers' buying behavior has become relatively more conventional, food is vital. Therefore, the cuts in the meals area aren't so big. What is more, when times are so difficult throughout the market, there is a tendency for folks to consume less out and eat more in. That is best for a refrigerator company.
However, the building and development sectors are down. Fewer new houses and apartments are built, thus the already existing homes will generally not buy a new refrigerator unless they end up having their old one.
Because of the economic crisis, increasingly more single teenagers do not re-locate using their company parents' house, hence no new homes are created and no new refrigerators are needed.
Cypriots are becoming more energy conscious since electricity rates have dramatically increased due to the local Electricity Authority's deficit following the explosion in 2011. Hence Cypriot consumers are looking for equipment that tend to be energy conservation and environmentally friendly.
The wide use of Internet sources has managed to get possible for Cypriot consumers to find all the available products on the market, compare them and choose what the buyer feels suits his / her needs. You can find, therefore, fierce competition with all the current available models from different companies.
Cyprus has a "mixed legal system of British common regulation and civil law with Greek Orthodox spiritual law impact" (CIA Factbook, 2012). The actual fact that Cyprus partially follows the British common law helps it be easier for companies from the uk to deal with Cyprus.
They are trying to modify taxation laws and regulations in Cyprus, that could discourage overseas organizations from joining the Cypriot market. But even that so, Cyprus still has one of the lowest corporate tax rates (10%) and VAT rates (17%) in European countries (Wikipedia).
More and much more Cypriot consumers are environmentally conscious and they're looking for energy conservation, environmentally friendly devices to avoid expensive power bills; hence, there is a considerable switch towards new, innovative, cost-cutting refrigerators, dishwashers and washers.
PESTLE research for India
India has agreed upon the Climate Change - Kyoto Protocol along with other environmental agreements and regulations and it is, therefore, subject to environmental control (CIA Factbook). This may be a good opportunity for energy saving refrigerators and other equipment.
India has reduced control on foreign trade and investment (CIA Factbook) which is wonderful for overseas organizations that wish to type in the Indian market either to operate or to spend.
In November 2008, terrorists from Pakistan planned some attacks in Mumbai, India's financial capital.
Corruption scandals that took place in India have slowed the legislative work in 2011 and thus, little economical reform was made (CIA Factbook).
According to the CIA Factbook on India, although India rebounded from the global economic crisis this year 2010, in 2011 the country's economic expansion slowed because of high inflation and interest rates and there is little improvement in financial reforms.
For imports and exports, India usually handles China, the United States, the United Arab Emirates, Hong Kong and Saudi Arabia (CIA Factbook).
According to the CIA Factbook, India has a young population. Thus there is certainly possibility and prospect of more homes to be created, hence more new appliances for the kitchen -and refrigerators- will be needed.
CIA Factbook goes on to say that India has pressing problems of important overpopulation, extensive poverty and wide-spread corruption.
There are over 60 million internet users in India who have the possibility to find and learn about Kool Kitchen's products in the event they want to learn more about the quality and the characteristics. However, this is not enough people if we consider that the populace of India in July 2012 was approximated to be 1, 205, 073, 612 (CIA Factbook).
As a previous British colony, India's legal system is the "common legislations system based on the English model" (CIA Factbook), thus making trade with the United Kingdom easier.
India has environmental degradation. According to the CIA Factbook it is the 4th highest country on the planet for skin tightening and emissions from intake of energy with 1. 696 billion Mt.
Opportunities and Threats in Cyprus and India
Both of the countries analyzed in this newspaper (India and Cyprus) are former English colonies and their legal systems are partially following the British common law. In addition to that, Cyprus is also a member state of europe. Trade amongst EU countries is easier and Cyprus bargains a great deal with the United Kingdom in conditions of imports and exports. This example could work in favor of Kool Kitchen since this can be a UK company and trade with these countries could be facilitated.
Furthermore, the reduced control that India is wearing overseas trade and investment may possibly also present a chance for Kool Kitchen there.
The global economical crisis has damaged the consumer habit of Cypriots. Teenagers are increasingly more unwilling to leave their parents' home and live on their own; the engineering industry is down; hence few new homes are designed and this has impacted the sales of appliances for the kitchen generally.
There is fierce competition in the refrigerators market in Cyprus as well as in India. Kool Kitchen will have to compete with long-running quality refrigerator manufacturers that are popular in both countries appealing, such as Electrolux, Whirlpool, Samsung, LG, Clear, Siemens and Bosch amongst others.
The political local climate in India could be characterized as unpredictable, since terrorist disorders happened in November 2008 in Mumbai by terrorists from Pakistan. The political environment in Cyprus is a lttle bit more stable, although there is a Turkish military presence in the northern area of the country which poses a regular threat despite the political initiatives to reconcile the two parts. Furthermore, Cyprus is geographically located in an area of further politics instability, since it's very near to Egypt, Israel and Lebanon.
We have evaluated and evaluated the external factors for the United kingdom refrigerator creation company called Kool Kitchen in order to entry the market segments of Cyprus and India. This assessment was done using the PESTLE analysis -looking at the Politics, Economic, Sociological, Technological and Environmental factors that encompass the countries in question, as well as the Opportunities and Threats each of the country symbolizes for Kool Kitchen. The global financial meltdown definitely poses a huge threat during this time period for just about any company that needs to produce a new business move, as well as the fierce competition, but there are also some opportunities and other environmental and technological factors that could work in favor of Kool Kitchen, should the company decide to follow these new marketplaces.
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