International Business Assignment Determining Market Potential of Latin America for a UK Retailer
Task: A UK Retailer who sells Motocycles and Outdoor Pursuit Clothing is keen to expand their business operations into Latin America. The overall aim of the research is to determine which countries in Latin America have the greatest market potential for their products? You have been employed to coordinate some research for this firm to help inform their decision making.
Using the above scenario, you are required to prepare a report on international business assignment consisting the following points:
a) Provide a background on the importance of conducting this research and outline the potential uses of your research to inform managerial decision making of the UK retailer who has commissioned it. (500 words)
b) Outline a set of appropriate research objectives (250 words).
c) Identify and justify your chosen primary and /or secondary research approaches to fulfil the objectives of your research? (400 words)
d) Who is the target audience for your research? (350 words)
e) Outline and critically evaluate the key challenges associated with conducting your chosen reseach approach in this Latin American country of your choosing (500)
While expanding business operations in an overseas market, it is important to acquire sufficient knowledge about the preferences and expectations of the consumers because it enables to continue business accordingly and achieve the designated outcomes (Peterson et al., 2020). The discussion presented in the international business assignment is inclined towards presenting the importance of international business research and how an UK retailer continue their business in some of the prominent countries of Latin America. The discussion would begin with a brief background, followed by research objectives, identification of suitable research approaches and target audiences while ending it with the identification of challenges, and the formation of a coherent conclusion.
1. Background of the Research, Its Importance and Potential Uses
There are 17 prominent countries in Latin America that are suitable for conducting business operations with some of the notable ones being Argentina, Bolivia, Brazil and more (Kim and Kim, 2020). However, the UK retailer needs to sell Motorcycles and outdoor pursuit clothing, suitable countries have to be picked for continuous operation. Conducting international trade research is of primal importance for the UK retailer because it would enable in fostering a good strategic plan for business expansion. According to Witt (2019), when the data collected about the position of a specific country is evaluated and analysed correctly, it creates an opportunity for the company to make accurate decisions eventually increasing the possibility of a successful trading. In addition to sophisticated strategic planning, it also facilitates in knowing about the potential of the foreign market. If the UK retailer proceeds onto expanding its motorcycle and outdoor pursuit clothing business in a country that prefers to remain mostly indoors and have an isolated social life, then the chances of attaining success would be minimum. The potential of the foreign market enables the company to conduct a viable assessment of their strengths and weaknesses. The financial planning is further fostered by the idea of identifying new global opportunities and enabling cost-benefit analysis. The management of the UK retailer would be subjected to the idea of balancing cost and risks against gaining potential returns.
It will be important for the UK retailer to identify which Latin American countries are the highest users of motorcycles and outdoor pursuit clothing, then the marketing prospects of the product can be decided accordingly. According to Cuervo-Cazurra et al. (2020), the use of this international market research would substantially encourage managerial decision-making because it also reflects on the latest research and developments in different perspectives of business operations. Additionally, it also enables in understanding cultural differences between the two countries. One of the crucial aspects to assure the success of an international business set up is understanding cross-cultural differences because that sets up the business for sufficient global exposure (Adamczyk, 2017). It also sufficiently fosters recruitment and selection process in the overseas market accordingly. This is the reason why the managers of the UK retailer with the cultural knowledge and dynamics of Latin American countries after making the final decision of specific countries chosen. The use of international market research would not be limited to subsequent financial planning and strategic planning but it would also suffice sufficient knowledge on the consumer, their purchasing process, existing competitors and growth rate of the market. Businesses eventually depend on market research to effectively make decisions about selling the products. Thus, the UK retailer would be benefited with sufficient amount of knowledge regarding the potential of the market and the chances of attaining maximum success in the overseas market.
2. Research Objectives
The formation of the research objectives would be essential in the formation of a strategic planning report. Thus, the following research objectives have been proposed for the UK retailer to gain sufficient success in the market:
• To determine which Latin American companies would be suitable for selling of the company’s products.
• To explore the cross-cultural differences that exist between UK and Latin American countries.
• To investigate the financial position of the Latin American countries to foster growth and development.
• To determine consumer preferences regarding Motorcycles and outdoor clothing.
• To investigate the marketing techniques that can be employed to effectively target consumer.
• To determine the impact of macro-environmental factors on the business environment.
• To investigate the competitive spectrum of the industry in which the UK retailer is going to conduct its business
• To determine an appropriate market entry strategy depending on the condition of Latin American business environment.
The purpose of the aforementioned objectives is to make sure that the UK retailer acquires sufficient knowledge about the differences and dynamics that exist between the two countries. The more knowledge about the market positioning is acquired, the chances of attaining success in business strategy would be higher.
3. Chosen Research Approaches
The chosen approach would be qualitative approach because it enables in the application of theoretical foundation and interpretivism research philosophy. The use of mixed methods approach has been denied because the collective use of quantitative and qualitative approach would be mostly time-consuming. According to Ryan (2018), the use of interpretivism research philosophy is effective in case of qualitative approach because it allows in the detailed interpretation of different elements of a study. Furthermore, it permits in conducting critical evaluation by relying on viable evidence. Some of the key advantages of using qualitative approach consists of being able to generate sufficient content, cost-effective, use of an open-ended perspective, incorporating the human experience and more (Pham, 2018). Such advantages make it extremely feasible for the UK retailer to identify intricate details about the condition of the market. However, there are sufficient range of disadvantages as well and they comprise of not being vitalised as important, not being generalizable in nature, researchers require sufficient range of industry experience and knowledge (Pham, 2018). From a critical perspective, it can be said that the retailer would need to hire an industry expert to conduct the entire research process, or the chances of attaining failures or false information would be significantly higher. The chosen approach would be based on both primary and secondary data because the market condition of Latin American countries is something that have been widely explored and have been true to the core. Secondary data refers to the type of data that has been collected by a different party and then used by the researcher and maybe availed from specialised sources, journal articles, business reports, government reports and more (Martins et al., 2018). The research tool would be eventually internet for secondary data, and interview for primary data. Apart from examining the business reports, economic reports and government reports, the researcher would also focus on the condition of different UK businesses that have already expanded to the Latin American market. The interviews would be semi-structured which would enable in acquiring much intricate details about the consumers and their preferences accordingly. This way the functionality and operational aspect so the company would be able to focus on its condition effectively and ensure that sufficient success has been attained in deciding on their existing strategic plan. The interview would be conducted over telephone because face-to-face interviews possess the risk owing to the condition imposed by the covid-19 pandemic. Some of the notable business articles would include Forbes, Times, The Financial Report and more. The use of different news articles would be utilised to garner information about the macro-environmental factors and they are BBC, The Guardian and more, Simultaneously, the use of different journal articles and country specific government reports would be focused on to coherently formulate the report. Thus, it cannot be denied that the use of different secondary data would be appropriate. However, while using secondary data, it would be made sure that the journal articles used are based on primary research to aid the customer segmentation and target audience aspect of the study.
4. Target Audience
Given that primary qualitative approach has been considered as the suitable method for acquiring a substantial range of information, it would be appropriate to conduct the interview among consumers. Eventually, the UK retailer would be inclined towards appealing to the masses and it would be quintessential in understanding the expectations and preference of the consumers before tailoring the products and services as per their needs. The use of purposive sampling would be appropriate for the study because eventually the UK retailer would have to appeal to individuals who indulge in outdoor activities and are inclined towards using motorcycles as well. Depending on the category of people who would be appealed to for the business, the judgement of the researcher is inclined towards interviewing people who are outdoorsy in terms of their activities. According to Etikan and Bala (2017), purposive sampling is also identified as judgemental or selective sampling technique where the researchers eventually rely on their own judgement while choosing a sample population for research purposes.
The criteria decided for the selection of the appropriate population consists of the following:
• Frequently indulged in outdoor activities
• Inclined towards using two-wheelers for road trips
• Adventure sports fanatics
• Inclination towards using motorcycles in general
The researcher would gain access to the chosen population with the help of social media and through word-of-mouth. The use of social media sites such as Facebook, Instagram, Reddit are some of the popular means of connecting with strangers and often creates the opportunity for subsequent interaction as well. Thus, it can be said that the use of this method would be appropriate in identifying the right population and seeking their consent before initiating the research.
5. Challenges Associated with Chosen Research Approach in Latin America
The ability to conduct an in-depth interview among the overseas population would be extremely challenging for the researcher. Here, the idea of multicultarility has to be adopted to ensure that the questions asked do not come off as offensive in any way possible and acquires the appropriate results from the sample population in the end. According to Zhang and Guttormsen (2016), Latin America’s population is open to the idea of diversity, culture and inclusivity and hence the use of right words is crucial whole interviewing the population. Any form of statements or questions that comes off as tone deaf to them would be triggering for majority of the population. Thus, it can be said that the use of cross-cultural communication skills would be important for the researcher to use while trying to target the chosen sample size. Additionally, Cronin-Furman and Lake (2018), mentions that the power imbalance between the respondents and the interviewer is another one of the crucial challenges, which mainly occur due to social categorization.
Given that the research tool that would be utilized is interview, language barrier may persist between the interviewer and the respondent. The language barrier can cause wide range of miscommunication and misunderstanding, making it difficult to acquire a substantial range of data to formulate a final report. According to Au (2019), the lack of willingness from the chosen sample population to participate in the interview may reduce the designated sample size, which would have been effective in validating the core aspects of the study. Thus, it can be said that the UK retailer would be subjected to mainly cultural barriers and language barriers while conducting the interview. This may further aggravate the problem of using an industry expert to conduct the research entirely. The industry expert would avail from the UK and may find it extremely difficult to sustain in the Latin American market and communicate with the locals to find accurate data for the study. As much as challenging the chosen approach would be while collecting suitable data, if the research procedure is conducted effectively, the chances of attaining positive results would be eventually higher.
This report led to an effective understanding of the methods that can be used to conduct international market research and the reason behind its importance. For the UK retailer it would be crucial to know more about the intricate details of the Latin American market before deciding to expand business operations onto different countries, indicating that the preferences of the target market have to be known. The use of interview based on purposive sampling method would be sufficient in acquiring beneficial results and subsequent attention of the masses towards the brand.
Adamczyk, M., 2017.The importance of cultural differences in international business. The Central European Review of Economics and Management (CEREM), 1(2), pp.151-170. Au, A., 2019. Thinking about cross-cultural differences in qualitative interviewing: Practices for more responsive and trusting encounters. The Qualitative Report, 24(1), pp.58-77.
Cronin-Furman, K. and Lake, M., 2018. Ethics abroad: Fieldwork in fragile and violent contexts. PS: Political Science & Politics, 51(3), pp.607-614. Cuervo-Cazurra, A., Andersson, U., Brannen, M.Y., Nielsen, B.B. and Reuber, A.R., 2020. From the editors: Can I trust your findings? Ruling out alternative explanations in international business research.In Research Methods in International Business (pp. 121-157). Palgrave Macmillan, Cham.
Etikan, I. and Bala, K., 2017. Sampling and sampling methods. International business assignmentBiometrics & Biostatistics International Journal, 5(6), p.00149.
Kim, Y.J. and Kim, S., 2020.Trade Integration and Business Cycle Synchronization in Latin American Countries. Journal of Economic Integration, 35(4), pp.559-575.
Martins, F.S., da Cunha, J.A.C. and Serra, F.A.R., 2018.Secondary data in research–uses and opportunities. PODIUM sport, leisure and tourism review, 7(3).
Peterson, M.F., Arregle, J.L. and Martin, X., 2020. Multilevel models in international business research. In Research Methods in International Business (pp. 417-432). Palgrave Macmillan, Cham.
Pham, L.T.M., 2018. Qualitative approach to research a review of advantages and disadvantages of three paradigms: Positivism, interpretivism and critical inquiry. University of Adelaide.
Ryan, G., 2018. Introduction to positivism, interpretivism and critical theory. Nurse researcher, 25(4), pp.41-49. Witt, M.A., 2019. De-globalization: Theories, predictions, and opportunities for international business research. Journal of International Business Studies, 50(7), pp.1053-1077.
Zhang, L.E. and Guttormsen, D.S., 2016. ‘Multiculturality’as a key methodological challenge during in-depth interviewing in international business research. Cross Cultural & Strategic Management.