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Lecture 7

Lecture 7- Invasion of the Retail.docx

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Stephen Swales

Invasion of the Retail Push Factor  Perceived “ saturation “ of the home market – point where you are not able to grow o Heavy competition o Lack of growth o Your taking market share away from your own retail sources  US economy recovery? o Circuit city big competition for best buy – they over bought , so they had to close down  Restrictive regulatory environment Pull Factors  Lack of market saturation o Underdeveloped retail sector o Long-term growth  Relatively lax, inviting regulatory environment  Emerging markets o Greatest opportunity perceived to be in emerging markets0 China, Brazil, Central and Eastern Europe Main Modes of Entry into Foreign Markets 1. Organic Growth a. Hierarchal diffusion i. Opening of new stores from larger cities to smaller towns b. Contagious Diffusion i. The stores are established in a disperse pattern from aa single location c. Mix i. Once an organization has reached a certain size , the organic growth can be a combination of the two previous strategies 2. Mergers, Acquisitions and Takeovers a. Merger i. Combination of two or more firms to form a new single company b. Acquisition i. When one firm pu
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