MARKET ENTRY OPTIONS

Market entry options

Introduction

The beer industry is considered to be extremely competitive due to its accomplishments in past few decades. In early nineteenth century, on could not imagine that beer industry will reach 21st century with global recognitions.

Company's Profile

Yanjing is malty smooth beer from china. Making its availability in all over China, the company exports globally. Since1980, the company is generating considerable revenues. Now, the company covers the area of 2,220,000 meter per square, with approximately 20,000 workers. Yanjing, being the largest company of the China produced a record of 3.1 million tons of quality beer in the year of 2005 (Khoury, 1984). Since then, the ratio of production is increasing and the company reached 3.84 million tons production in 2009, 15.3% greater than last year. This made a large increment in total sale revenue of the company. The increment was about 31% in 2009. The trend of reflecting profitability still continues by the company. It occupies major 80% shares in domestic market, majorly in Beijing and Guangxi. Other major market includes Hubei, Mongolia and Fujian. In addition, there is tremendous sales growth in Zhejiang and Guandong.

Global Market Analysis

The beer industry is the largest sector in Alcoholic Beverage industry. It has global sales of about 325 billion USD, annually (Piercy,1982). However, there are some limitations in the growth of the industry due to market saturation in developing countries that makes them to focus on emerging markets. Due to these limitations, companies that have expanded themselves have faced considerable competitive demands. However, over the past few years, the industry has advanced itself with the help of litigation, as well as advertising and marketing practices. Expansion into major emerging market has become strategic priority for leading firms, who are now competing for market share in several significant areas of the world (Cunningham,1986).

Discussion

There are varieties of market options that are available for any business to expand itself in global market. The options may vary according to the risk, cost, and rules and legislations that are going to be implemented over them (Khoury, 1984).

Market Entry Options

Any organization can enter any foreign market in a number of ways. The major ways through which it can enter into global market includes

Export

The simplest and basic way to enter a market is through exporting your product to that market. It is marketing and selling of products developed in another country. It is simple that there is no strategy for producing a product in that product however there is one for marketing it. Exporting has several advantages. It is less risky as only is needed to be exported. It offers the opportunity to experience the market before entering to produce. Does not have risks related to operating it (Pavord , et,al., 1991).

Main disadvantage, that every business has, is that it is dependent on the distributors to help sell the product. So the owner has not much control over the exports. Like a beverage company in USA can't control how its products are sold ...