A Market Growth Plan For Introducing Specsavers In Venezuela

Overview of Specsavers Optical Group Ltd

A market growth plan, also known as market development, entails selling any present product in a new market. A market growth strategy can be implemented for a variety of reasons. First, the current market is so crowded that there isn’t much room for growth. Sales and profits do not increase until a company discovers a new market for its goods. The objective of this task is to analyse and plan effective introduction of Specsavers in Venezuela. Specsavers Optical Group Ltd is an international optical retailer based in the UK, Ireland, Australia and Nordic countries. The network provides eye exams and sells eyeglasses, sunglasses, contact lenses, optometry and optics services. Hearing aids are also sold here. In 2012, it had the largest market share among the four largest opticians in the UK with 42% of the market. The group was founded in 1984 by Doug Perkins and Mary Perkins, a married couple from Guernsey in the English Channel. It has retail outlets in Ireland, the Netherlands, the Nordic countries, Spain, Australia, New Zealand and the UK. In 2002, the company expanded into the hearing aid business. Their hearing centre offers hearing screenings and hearing aids with over 400 Specsavers optical points. Venezuela, officially the Spanish Repblica Bolivariana de Venezuela, is a republic off the northern coast of South America, made up of a continental land area and numerous islands and islands in the Caribbean. Venezuela covers an area of ??916,445 km2 (353,841 sq mi) and is expected to have a population of 28 million in 2019. Caracas is the capital of the country and the largest collection of cities (The Global Economy, 2021).

Venezuelan policy is implemented within the framework determined by the Venezuelan government. The Venezuelan United Socialist Party dominates the dominant party system in Venezuela, among the other parties listed in the next section. The ruling Venezuelan United Socialist Party (PSUV) was formed in 2007 by uniting the Chavez Fifth Republic Movement with a number of minority parties supporting Hugo Chavez’s Bolivar Revolution. Since 1998, PSUV and its predecessors have served as President and Member of Parliament. Founded in 2008, the Mesa de la Unidad Democratic (MUD) brought together much of the opposition parties (such as New Era (UNT), Project Venezuela, Justice First, Socialist Movements (Venezuela). Hugo Chavez, a prominent Venezuelan figure who was elected president in 1998 as a political outsider, died in early 2013, followed by Nicolas Maduro Venezuela in 2013. Venezuela is run by a president. In 2020, the Economist Intelligence Unit classified Venezuela as an “authoritarian regime” with the lowest score in the Americas.

Venezuela faced a constitutional disaster in 2017. In March 2017, opposition leaders took the long-standing political confrontation to new heights by branding President Nicolas Maduro a ruler after the Supreme Court, which joined Maduro’s side, took over the functions of the National Assembly. The Supreme Court overturned most of the parliamentary decisions after the opposition took control of the National Assembly. Maduro won 67.8% of the vote in the 2018 general election. Argentina, Chile, Colombia, Brazil, Canada, Germany, France, and the United States have all challenged the results, arguing they are invalid and recognising Juan Guaido as the interim president. Other countries, like as Cuba, China, Russia, Turkey, and Iran, have continued to accept Maduro as president, but China has begun to hedge its bets by cancelling joint projects, slashing financing, and expressing openness to work with all parties for financial reasons. Pressure is something that is well-known. The report is untrue, according to a Chinese Foreign Ministry spokeswoman..

Overview of Venezuela

US President Donald Trump signed a complete economic lockdown on Venezuela in August 2019. In March 2020, the Trump administration charged Maduro and seven Venezuelan officials, including Chief Justice, on drug trafficking, drug terrorism and corruption. In June 2020, the American organization Robert F. Kennedy Human Rights published a study of enforced disappearances in Venezuela during 2018 and 2019. During this period, 724 cases of forced disappearance of political prisoners were registered. According to the report, Venezuelan security officials used illegal methods of interrogation, including torture and other cruel or inhumane treatment, of missing victims. According to the report, the Venezuelan government has used enforced disappearance as a strategy to suppress political opponents, and other critical voices are considered dangerous.

Political Stability Index 1996–2020 (low 2.5, strong 2.5): Data are available for Venezuela from 1996 to 2020 for the indicator. At the time, the average for Venezuela was 1.15, with a minimum of 1.54 in 2019 and a maximum of 0.54 in 1998. 1.52 points is the latest value for 2020. The 2020 global average is based on 194 countries. 0.07 points. Use our country-by-country comparator to compare trends over time or see global rankings for that metric. Venezuela’s judicial system is hostile and open. Venezuela has refused to submit to the compulsory jurisdiction of the International Court of Justice (ICJ). Venezuela is experiencing one of the worst economic disasters of any Latin American country. Inflation is expected to hit 400% this year, and some departments of the country’s electricity companies are already trying to light it up. The country’s largest brewery has already closed, and Coca-Cola continues to struggle for sugar to produce soda. Matt O’Brien explained in a recent essay on the whimsical blog The Washington Post: “Venezuela has gone bankrupt. According to the latest forecasts from the International Monetary Fund (IMF), it currently has some of the worst economic growth, inflation and unemployment rates in the world. In addition, the number of homicides ranked second in the country, and the infant mortality rate in public hospitals has increased 100-fold over the past four years.”

Venezuela has a high level of corruption by worldwide standards, and it has existed for much of the twentieth century. The discovery of oil increased political corruption, and Juan Pablo Perez Alfonso began to refer to oil as “the devil’s crap” in Venezuela in the late 1970s. Venezuela has consistently been classified as one of the most corrupt countries in the Corruption Perceptions Index since its inception in 1995. In 2010, Venezuela rated 164th out of 178 countries in terms of government transparency. It was ranked 166th out of 178 countries in 2016. In the 2014 Rule of Law Index, the World Justice Project placed Venezuela #99 out of 99 countries examined.

Venezuela’s important role in Colombian cocaine and drug trafficking across Venezuela to the United States and Europe is an example of this corruption. Between 2003 and 2008, Venezuelan authorities seized the fifth largest cocaine seizure in the world, after Colombia, the United States, Spain and Panama. ONA, the Venezuelan government’s anti-drug organization, was reorganized in 2006 as the Office of the Vice President of Venezuela. Meanwhile, many senior government and military officials have been involved in drug trafficking, particularly the October 2013 incident. The Venezuelan National Guard did not load 1.3 tons of cocaine on a plane in Paris, knowing it would not.

Political Stability in Venezuela

The Current Economic System and Structure

Venezuela’s economy is in decline, with a contraction of 17.0% in 2014-2016, 15.7% in 2017 and 19.6% in 2018. According to the IMF, the economy will contract by 35% in 2019 and 25% in 2020. According to the October 2020 IMF report, annual inflation reached 255% in 2016, 438% in 2017, 65,374% in 2018 and 19,906% in 2019. According to research, inflation is expected to exceed 6,500% by 2020. Venezuela’s economy is primarily dependent on oil exports and production. In 2018, oil exports accounted for at least 88% of total exports and at least 40% of budget revenues. Current oil production is expected to be around 487,000 barrels per day, according to OPEC sources. The average oil price in Venezuela in 2019 was $55.90 per barrel. In 2020, it fell to $28.12 per barrel. 2020 saw increased availability and stabilization of food and health services.

In 2014, Venezuela’s GDP per capita was estimated at $14,025.36. Venezuela’s GDP per capita is 111% higher than the world average. According to Global Macro Models and Analysts from Trading Economics, Venezuela’s GDP per capita is expected to reach USD 10,000.00 by the end of 2020. According to the economic model, Venezuela’s GDP per capita is expected to be USD 9,500.00 in 2021 and USD 9,000.00 in 2022. According to a recent survey, Venezuela’s poverty rate increased to record levels in Latin America in 2019 as the once-thriving oil-producing country faced its sixth consecutive year of hyperinflationary economic collapse. According to the 2019-20 National Survey of Living Conditions (ENCOVI), 64.8 percent of Venezuelan families faced “multidimensional poverty” in 2019, according to academics from Andres Bello Catholic University (UCAB). Among other things, education and government services are important.

According to the latest World Bank annual assessments, Venezuela is placed 188th out of 190 economies in terms of ease of doing business. Venezuela’s position stayed constant at 188 in 2019 compared to 188 in 2018. Since Venezuela does not have a major trade law, trade policy is based on a patchwork of laws that come into force through laws and ordinances. Obligations in regional forums, especially the Andean Group, GATT and WTO, have brought about many changes in trade legislation in recent years. Four years after the negotiations began, Venezuela became an official participant in the Uruguay Round. After ratifying the Marrakech Agreement, he became a founding member of the WTO on December 29, 1994.

From 1973 to 2021, Venezuela’s inflation rate averaged 3,762.64%, reaching a high of 344,509.50% in February 2019 and a low of 3.22% in February 1973. In early 2018, the Central Bank of Venezuela announced that it would devalue its official currency. It is over 99% and represents the new currency platform DICOM. According to the central bank, the first auction of the central bank’s new DICOM system brought in 30,987.5 bolivars per euro, or around 25,000 bolivars per dollar. For more than 15 years, the country’s official currency, the Venezuelan Bolivar (VEF), has been under the control of the regime. Despite regular devaluation, the “official” exchange rate continues to overvalue the currency.

The Economic Situation in Venezuela

97.1% of people- the adult literacy rate in Venezuela (Republic of Bolivia) was 97.1% in 2016. The adult literacy rate in Venezuela (Republic of Bolivia) increased by 1.32% annually, from 89.8% in 1990 to 97.1% in 2016.

The labour force participation rate of the 15 to 24-year-old population is the proportion of all those who provide labour to produce goods and services during a certain period of the 15 to 24-year-old economically active population. In 2019, Venezuela’s economic activity rate was 34.09%, down 2.23% from 2018.

The Industrial Property Act of 1956 is Venezuela’s primary law governing trademark registration and protection. To register a trademark in Venezuela, you must submit an application to the Venezuelan Patent and Trademark Office (SAPI), which oversees the entire trademark registration process. Exclusive trademark rights in Venezuela are acquired only through registration under the Industrial Property Act. Meanwhile, the owner of an unregistered trademark may prohibit trademark registration by filing an objection to an application based on the unregistered trademark.

The culture of Venezuela is a blend of three ethnic groups: indigenous Venezuelans, Africans, and Spaniards. Tribes and subcultures were established in the first two cultures. Cultural adaptation and absorption, which is indicative of cultural syncretism, has resulted in today’s Venezuelan culture, which is similar to other Latin American civilizations in many respects yet preserves its own distinct traits. 

Venezuelans are suffering from severe economic and social catastrophe, food shortages and hyperinflation. According to the Living Conditions Survey (Encovi 2019-2020), the informal market currently accounts for 45% of the workforce and employs them. Many multinational companies have ceased operations in Venezuela due to the crisis, and the depreciation of the national currency has made importing goods from abroad almost difficult. As a result, counterfeit products, mainly from China, are increasingly appearing on store shelves. According to the non-governmental organisation Observatorio Venezolano de la Violencia, Venezuela’s situation has intensified to the point where it will be the most dangerous country in Latin America in 2020, with a homicide rate of 60.3 per 100,000 people. As a result of the aforementioned issues, shopping habits have changed and the focus is now on everyday grocery shopping.

Venezuela is a signatory to the Paris and Berne Industrial Property Convention (author’s copyright). However, exercising controls to protect patents, trademarks, designs and other intellectual property rights in this country is extremely difficult. Therefore, it is desirable to register these goods and services in Korea. It is also worth noting that the country is not a party to the Rome Convention (which deals with the protection of artists and translators). Requirements and importance of business structure and development in Venezuela;

• Private Limited Company- it requires 2 partners. There is no minimum investment. Shareholders and their responsibilities: The level of liability is limited by the amount of capital invested.
• Public limited company- – it requires 2 partners. There is no minimum investment. Shareholders and their responsibilities: The level of liability is limited by the amount of capital invested.
• General Partnership- it requires 2 partners. There is no minimum investment. Joint and several responsibilities
• Limited partnership- – it requires 2 partners. There is no minimum investment. Joint and several responsibilities. Managed partners are jointly and individually liable, tacit partners limited to contributions

Venezuela has huge investment and growth potential. Combined with abundant natural resources, it has attracted global investment. On the other hand, political instability, bureaucracy and corruption are hampering the current business environment. Companies doing business or planning to do business in Venezuela cite transportation shortages, port security and high tariffs as major issues affecting their operations. Transparency of the regulatory system. Foreign investment in Venezuela is severely constrained by political and regulatory instability. Trade, industrial and commercial laws and regulations are subject to dramatic change without notice. Currency Exchange and Remittance Policy: The Foreign Exchange Bureau must approve all foreign exchange requests at the official exchange rate (CADIVI). All approved foreign exchange transactions are handled by the Central Bank of Venezuela (BCV). Venezuelans, like many Latin cultures, are risk averse, therefore getting to know and trust the individuals with whom you do business is critical. Face-to-face encounters are preferred by Venezuelans over business calls or written meetings, which they consider harsh. Because corporate leadership is mainly upper-class, it is critical to comprehend the hierarchy and show correct regard and respect for people in positions of power.

Conclusion

While Venezuela’s most important challenge is to address its macroeconomic challenges, it must continue to reform its trade and related policies. This is a prerequisite for increasing the adaptability of the domestic sector to the challenges and opportunities associated with the implementation of the Uruguay Round. Consequently, we must continue the liberalization process that began in 1989 and ensure that the introduction of exchange rate regulations does not harm Venezuela’s trading partners. According to a recent World Bank estimate, Venezuela ranks 188 out of 190 countries in terms of ease of doing business. Venezuela’s location remained unchanged from 188 in 2018 to 188 in 2019. Hence entering in the market can bring development to the company and there is low market competition that will profit its market entry process.  

References

ABC Amega, 2021. Country Risk: Venezuela | ABC-Amega. [online] ABC-Amega, Inc. Available at: <https://www.abc-amega.com/articles/country-risk-venezuela/> [Accessed 24 December 2021].

Carroll, R., 2014. Comandante. Penguin Books: New York.

Corte?s, C., 2013. Multicultural America. Los Angeles: SAGE Publ.

GOV Uk, 2021. Overseas Business Risk – Venezuela. [online] GOV.UK. Available at: <https://www.gov.uk/government/publications/overseas-business-risk-venezuela/overseas-business-risk-venezuela–2#economics> [Accessed 24 December 2021].

Knoema, 2021. Venezuela (Bolivarian Republic of) Inflation rate, 1980-2020 – knoema.com. [online] Knoema. Available at: <https://knoema.com/atlas/Venezuela-Bolivarian-Republic-of/Inflation-rate> [Accessed 24 December 2021].

The Global Economy, 2021. Venezuela Political stability – data, chart | TheGlobalEconomy.com. [online] TheGlobalEconomy.com. Available at: <https://www.theglobaleconomy.com/Venezuela/wb_political_stability/> [Accessed 24 December 2021].

Tradingeconomics.com, 2021. Ease of Doing Business in Venezuela | 2021 Data | 2022 Forecast | 2008-2020 Historical. [online] Tradingeconomics.com. Available at: <https://tradingeconomics.com/venezuela/ease-of-doing-business#:~:text=Ease%20of%20Doing%20Business%20in%20Venezuela%20is%20expected%20to%20reach,according%20to%20our%20econometric%20models.> [Accessed 24 December 2021].

Tradingeconomics.com, 2021. Venezuela GDP per capita | 2021 Data | 2022 Forecast | 1960-2020 Historical | Chart. [online] Tradingeconomics.com. Available at: <https://tradingeconomics.com/venezuela/gdp-per-capita> [Accessed 24 December 2021]. 

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