International Retailing

Presenter: Amit Kumar Roy

1014370005

International Retailing Defined ² Definition:- “ All the activities involved in selling products and services to final international consumers for their personal consumption.” ² “Retail internationalization is the management of retail operations in

market which are different from other in their regulation, economic development, social conditions, cultural environment and retail structures.”

² Transferring retail operations, concept, management expertise & buying function across national borders.

² Global retailing is now valued at $ 7 Trillion (Source:2011 Global Retail Report, Deloitte Touché Tohmatsu).

Growing Indian Retail Sector

Retail Sector contribution to GDP sector is 8%-10%.      

International Retail At Glance

38%

27%

13%

8%3% 2% 9%

USA EU Japan ChinaIndia Russia Others

Factors Affecting International Retailing

Expansion of Retail Operations To

Foreign Market.    

Transfer Of Retail Concepts.

Internationalization Of Management

Expertise

Employing Advance Technology.

Issues In International Retailing

International Retailing

Legislation &

Regulation

Taxation & Cross Border

Shopping

Variations In Retail Practices

(Consumers Perspective)

Variations In Retail Practices

(Sales people And Management)  

Indian Vs. Global Retailing

Indian Retailing Global Retailing

A)  Retailing  Is  mostly  unorganized.                                    A)  Mostly  Organized  Retailing.    B)  It  is  concentrated  around  few  formats.          B)  Large  number  of  retail  formats  .    C)  Lag  behind  in  use  of  technology.                                  C)  Advanced  technology  applications.    D)  Infrastructural  Bottlenecks.                                                    D)  Minimum  infrastructural  problems.    E)  Low  competition  market.                                                            E)  Cut-­‐throat  competition  exists.    F)  Lack  of  trained  Manpower.                                                      F)  Trained  manpower  aids  retail  boom.      

Internationalization

Concept:- “It is the act of crossing international boundaries with business interests .” v Choices of Internationalization:-

ü  Self-Start Entry.

ü  Acquisitions & Mergers. ü  Joint Ventures. ü  Franchising. ü  Exporting.

Reasons 4 Going International

•  PULL FACTORS:- are

Pro-active reasons, are

motivating forces which

attract business. E.g.

Profitability & Growth

prospects.

•  PUSH FACTORS:- are

Reactive reasons, are

compulsions of domestic

market like saturation of

market, Unskilled

manpower etc.

Process Of Internationalization

Foreign  Direct  Investment  Establishes  production  line  in  Host  country  with  prescribed  FDI  norms.  

Local  Packaging  and  or  Assembly  Involving  in  Host  country  Factor  market,  dealing  with  environmental  variables  such  as  cultural  attitudes,  wage  rate,  workers  

expectations.  

Export  through  own  sales  representative  or  sales  subsidiary.  

Firm  sets  a  separate  export  department  to  manage  sales  and  production,  tailoring  of  product  design  as  per  export  market.  

Export  via  agent  or  distributor  

Firm  uses  export  as  “Vent”  for  its  surplus  production  and  may  have  no  long  run  commitment  to  the  international  market.  

Licensing  A  contractual  agreement  in  which  one  firm  provides  access  to  some  of  its  patents,  trademarks,  or  technology  to  other  firms  in  

exchange  for  fee  or  royalty.  

Globalization

² Concept:- “Integration with world economy or the process of integration of the world into one huge market.” ² I.M.F Definition:- “The growing interdependence of countries worldwide through increasing volume and variety of cross-border transactions in goods and services and of international capital flow and also through more rapid and widespread diffusion of technology.” ² The firm commits itself with several manufacturing locations around the

world.

Globalization Advantages

Free flow of technology.  

Increased industrialization.  

Development of world economies.  

Increased employment and income.  

High standards of living.  

Globalization Disadvantages

Heterogeneity of problems.  

Reluctance of developed countries.  

Reluctance of developing countries.  

Short term gains.  

Multi-national & Trans-national Retailers

•  Multinational Retailors:-

The retailer operates in

more than one country and

adapts its offering to fit

that country.

•  Transnational Retailors:-

The retailors develop a

world class format that is

flexible enough to adapt to

local markets.

Amit Kumar Roy (1014370005)