A reason Stirling Bakers could want to go
international is because they are in a statured market domestically. At the
moment Stirling baker’s products are no longer creating any new demand for
their products. This can be justified because in 2009 their sales growth
decreased even though they increased their “advertising and promotional
A reason why Stirling Bakers is considering entering international
markets is they have interested wholesalers throughout Europe and one in China.
Going international for Stirling Baker would mean a larger market for them as a
company. Going into a larger market will increase the customer base for the
company, this increase in customer could then positively affect the company’s
growth. This growth will also help with the security of the company because it
will help spread the risk of something happening to the company. In addition,
would provide and different source of revenue and help secure long-term success
for the business. Furthermore, it will create new opportunities for Stirling
Bakers to diversify their product for example they could make new products of
specialised confectionary from the origin of the wholesaler’s country.
reason for Stirling Bakers to go International is the cost of labour. Stirling
baker having interest party’s in china and a potential factory will mean the
cost of labour will be low. This mean that Stirling will benefit will gain a
bigger profit from their goods in addition more money can be spent on more
produce. In addition to lower cost for labour it will lead to the economies of
scale. Stirling Bakers having a bigger production will mean buy more of their
ingredients in bulk which mean it will result in discounts for Stirling Bakers,
“the greater the quantity of good produced, the lower per-unit fixed cost”.
A source of information Stirling Bakers will
have to access before going into international markets is the China-Britain
Business Council (CBBC). Stirling Bakers
will have to access this source of information because they have interested
parties who would like to sell their products in China. CBBC will help Stirling
bakers because they post
regular business opportunities from Chinese companies online. In addition CBBC
works with the government to highlight export opportunities
A source of information Stirling
Bakers will have to access before going into international markets is the
Department for International Trade. Stirling Bakers will have to access this
source of information because they must understand the rules and new trade
policy that the UK may have created. In addition what trade agreement have been
made with non-EU countries
Understanding the Political factor is important when entering an
international market because it can affect the company’s decision making and
operational stand point. Using the political element is important because it can
help identify the attitudes of the government has to foreign investors. How
stable the country is politically as well as how government policies can hinder
or benefit your company.
Understanding the Economic factors is important when entering an
international market because it can affect the consumption and production of product,
in addition to the money supply for the certain region of country you are based
in. Using the economic element is important because it can help identify the
rate of unemployment or employment. The exchange rate and interest rate.
Understanding the Social factors is important when entering international
market because a failure to know the society can severely affect the consumer
perception of your company. Using the social element is important because it
can help identify the health and diet implications of international countries
which could be a result of religion for example in Saudi Arabia the religion of
Islam is the state religion so therefore no pork could be sold. Furthermore,
the customer lifestyle and values.
Understanding the Technological factors is important when entering
international market because not evolving and keep up with new technology
advancement can impact the company.
Using the social element is important because it can help identify that
cloud computing is important internationally because help share document
easily. In addition, many consumers have vast technological knowledge and
having good technological base will help companies.
Understanding the Environmental factors is important when entering
international maker because the company must know how it could play in
affecting their company. Points which the Environmental factor may identify is
the climate of the country, the carbon footprint created and pollution.
the legal factors is key because organisations must understand legal system
used within the countries. Having this knowledge will help keep the business in
a positively light publically. Legal element may highlight the health and
safety of consumer and employees, the consumer rights and laws. The advertising
standards of the country and product safety.