Turkey as a country
Discuss about the Importance Of International Expansion Of Business Lies.
One of the major ways to make a business expand in the modern times is to expand it to the international arena both in terms of business and customer base. The importance of international expansion of business lies in the fact that it helps the brand as well as the country to make its mark in the international arena and niche a name for itself on a global platform. The importance of the international expansion of business is evident in the fact that most of the major companies of both the developing and developed countries are trying to get hold of the market of the other countries in which the company has not ventured before (Shenkar, Luo and Chi 2014). The following report deals with the expansion of beauty industry from the province of Turkey to Australia with the amount of risk and other problems involved in the same. The following paragraphs deal with the PESTLE analysis of both the countries along with the ethical, corporate social responsibility and sustainability conditions with the same. The highlights of both the countries in terms of business modules are also mentioned to give an apt image of the conditions that influence the market of both the counties.
Turkey is one of the major developing markets of Asia which is both attracting business from outside the country and making its presence felt in the other countries of the world. Situated at the conjuncture of West Asia and South East Europe, the unique location of Turkey makes sure to gather business from both the sides of the continent and give adequate revenue to the business done and the business involved (Bu?ra and Sava?kan 2014). The country supports a Free-Trade policy that makes it one of the potential countries for marketing the products and selling them. Being one of the richest countries with a democratic picture, it has a lot of scope for flourishing of the industries mentioned. The beauty and cosmetic industry of Turkey is one of the major booming industries of the country as like every country of the world, it has a growing and expanding customer base for the beauty products (Irwin 2015). The country supports the flourishing of the beauty industries which can be seen in the positive PESTLE analysis mentioned below.
The political factors of Turkey play an important role in flourishing the market for cosmetic and beauty industry. The government support and non-rigorous industrial policy for the country provide an adequate amount of political support for the conduction of the business. Turkey is a Republican Parliamentary Democracy that helps the country to make adequate provisions for the internal growth of the business sector (Bianchi 2014). Inspite of the support of the internal government, the country is near to the war zone of Syria which makes it a potential threat for the industries to get flourished which the government is dealing with.
PESTLE Analysis for Beauty Industry in Turkey
Turkey has a free-trade economic zone that helps the industries to flourish and make way for their international expansion. The industries from outside the country also are welcomed in the country with the open market urged by economic reforms of privatisation of industrial sector (Balasubramanyam and Togan 2016). The beauty industry receives the right amount of economic boost from the country as it gives a booming and ever-growing market to the industrial sector.
The social factors of the beauty and cosmetics industry of Turkey include the factors of constant demand for the products and acceptance of new and innovative products into the market. The social factors also include the increase of women empowerment that gives them the purchasing power and also the will to express their demands and needs of the products (Çaha 2016).
The technical factors associated with the cosmetic and beauty industry of Turkey include the various resourcing of methods and raw materials for the implementation of the final products. The ways in which the products are manufactured are also taken into consideration and various processes and new technical advancement are made sure in the technical aspects of the analysis of the beauty industry. The technical factors play a major role in the beauty industry of Turkey as with the technical advancement it is possible to make new and innovative products for the customers which will attract more sales and thereby more revenue for the company.
The legal factors have a major role to play in the beauty industry of Turkey as the compliance to legal terms and factors make the overall process of manufacturing and processing of the goods easier to connect to the audience. When an industry follows all the legal formalities and abides by the acts set by the Consumer Law and the Cosmetic products (safety) regulation 1996, then the customer makes the brand a better aspect and a more reliable purchasing source. The legal compliance to the cosmetic industry is of major importance in Turkey as the customers can trust the brand more with the legal backings.
The environmental factors also play a major role in the cosmetic and beauty industry of Turkey. With the compliance to the environmental facts and conditions and adherence to the norms of environmental sustenance the industry finds it important to make their products both bio degradable and safe for the environment. The banning of plastic packaging and using non-soluble beads in the products hamper the environmental balance of the industry that is not desirable at any instance. The products that are to be manufactured should be in accordance to the environment safety rules and regulations set up by Turkey which is valid in most of the cases of the times.
Strategies for International Business Expansion
Business Expansion is defined as the ways in which a business or an industry of a particular sector is expanded from the local market of a particular country to the global front or to any other country where the industry or the brand has no present presence. The importance of business expansion lies in the fact that with adequate business expansion, the industry and the brand can help to get more sales and revenue into its consideration and also make sure that the brand has more customer base from not only the native country but also from the other countries or international market (Kumar, Gaur and Pattnaik 2012). There are a number of ways in which business can be expanded on an international level which are mentioned below –
- Increment of Sales of the products
- Introduction of a new product
- New Market Segment or venturing into a new market
- Starting a chain
- Franchise or License
- Collaboration or alliance with a brand from the desired country
- Going global in terms of products and marketing
All these ways help a business to develop into the new market arena and help the existing brand or industry to flourish with a level that help the brand to create a good market place for the new industry. The use of these strategies in the market of the brand or the industry help the particular brand or product to create a global value that in turn affects the market value and the pricing of the brand. Also, the shares of the brand increase to a major extent with the business expansion of the products. One of the major ways to expand a particular business to the international level is through Franchise and licensing which is analysed below.
Franchise is defined as a temporary business opportunity given to a particular business both in terms of investment as well as the leasing of the products for a substantial period. The importance of franchise lies in the fact that it involves less risk for the businessman and also gives more opportunity for the brand to get an overview of the demands and the conditions of the brand in the new business arena (Keup and Keup 2012).
Licensing is defined as an arrangement or contract in which the licensor gives the right of intangible property to another entity or person for a considerable specific period and in return get a royalty fee from the license (Dratler Jr 2017). This is one of the major ways to expand any new business to a new economy and also to take chance at any new brand being established in the foreign land without any proper investment by the brand with minimum risk taken. This form of business expansion is done mostly by the food and beauty industry where the physical presence of the company is not required while the existence of the brand is more vital.
Franchise and Licensing as a strategy for Business Expansion
The beauty industry is one of the potential industries for the expansion of business in terms of franchise and licensing sector. The beauty industry is one of the growing industry all over the world which is focussed on the growth and development of the brand. The beauty industry of Turkey when in a developing spree to the rest of the world should adopt the policy of franchise and licensing so that the industry should get into the various parts of the world with minimum risk and maximum profit both for the industry and the new business organization in which it is spreading (Davis 2012). The beauty industry when spreading from Turkey to Australia should adopt to the various licensing policies of the country which should be adopted to the Franchising Code of Conduct. The adoption of the various policies for the franchise of the products should be made into effect considering the licensing acts along with the taxation policy of the country. The compliance to the various taxes of the country along with the various other factors makes the expansion of business to Australia one of the essential and positive decisions that can be taken by the industry.
Australia is one of the developed countries of the world with a wide customer base that attracts business from most of the countries of the world. Different countries try to set up their business in the Australian province as it attracts a large number of customer base and makes sure that the brand gets enough exposure to the world business. Being situated in the heart of Southern Hemisphere, isolated from the rest of the world, the brands that are focussed on the country makes sure that the customers give importance to the brand that is being established in the genre. The country has its own regulatory body for business with business visa associated with it which makes it one of the best places for the fair practises of the conduction of business.
The political factors of the country play a major role in the setting up and establishing a franchise for the beauty industry in the province of Australia. The political condition of the country is stable which makes it one of the best places to invest and set up the body of the industry. The government has its own regulatory body for franchise and licensing for brands that are coming from outside the country to set up an identity in the country (Gray, Harymawan and Nowland 2016). The expansion to Australia of a beauty company can be profitable as there is an increase in demand for the middle-eastern beauty products in a market regulated by chemicals and normal companies as the government has the measure to imply good subsidy and other factors for the setting up of new business.
Being one of the best capitalistic economies of the world, Australia is one of the greatest markets for economic expansion of the brands from the Middle East. The economic stability of the country makes it one of the potential markets for the expansion of the cosmetic industry from the middle east to the south. The country has a history of economic stability which attracts a huge amount of investment both from the eastern to the western countries.
The market for the cosmetic and beauty in Australia is one of the major factors that is responsible for the good market for the cosmetic industry in Australia. There is a huge population that uses beauty and cosmetic products in the country making it one of the potential markets for the advancement of the business in the area. Other social factors include the need for the new and traditional products that the people of the country demands over the chemical-laden goods.
The technological advancement is one of the major factors of the establishment and advancement of the industries in the province of Australia. There is a surge in technology in the sector that makes it one of the potent market for the technical advancement of the industry related to beauty and cosmetics.
Australia has its own set of legal implications like procuring a legal visa for the setting up of the business in Australia. There are certain rules and policies that are set up by the Australian government for the establishment of the cosmetics industry. The legal factors like approval from FDA is one of the major issues that is being faced by the Australian industries as well as the industries coming from outside.
Being one of the most developed countries of the world, the country emphasises on the need of environmental approval from the required sources for the setting up of the industries. The environmental factors like minimum use of plastic and other non-biodegradable products make the setting and advancement of industries in Australia one of the major issues.
In order to make a certain industry reach the international level, there are some analyses done which has been discussed. However, there are certain risks associated with the same like adoption of the products in the new market and the risk involved in terms of investment. The product should be accepted by one and all when venturing into the new market and should include all the necessities that are said by the brand (Liesch, Welch and Buckley 2014). When a beauty industry is being franchised in Australia, then there is a need for the people to accept the products and believe in the traditional forms from Turkey. This, if not the case will pose a serious concern for the owners as well as the franchise holders.
The industry should adopt to the ethical consideration of the country as well as the industry. The raw materials sourced should come from fair places that are both cruelty-free and environment-friendly. All the associates of the brand should be treated in a proper manner that should be the primary ethics of the brand along with the other sources of raw materials. All the process should be conducted by fair means and should be made to procure the maximum gains.
The industry should adhere to the corporate social responsibility of the industry. In terms of beauty industry, no animals should be harmed along with zero tolerance for the animal testing and other cruelty. The products should be made using sustainable means and should be one of the major sources of revenue for the people involved. The industry should be responsible towards the society and should not promote racism or any sort of malpractices by any means.
The beauty and cosmetic industry should be sustainable both to the environment and to the society. The products should be of good quality that should be environment friendly and majorly attracted to the young and trendy people of the society.
Conclusion
In conclusion, it can be said that the idea and intention to expand a cosmetic and beauty industry to Australia from Turkey is one of the major positives that is being taken by the business development executive of the country. The PESTLE analysis of both the countries should be considered along with the other practises to make sure that the ways and means of expanding the business is done in a fair and conventional means.
- The demand for the product should be analysed for the better sales and profit of the organization
- Marketing of the products should be done accordingly so that the customers can know more about the brand
- Advertisements and social media promotions should be done for the better conduction of the business.
- Both the countries should be analysed to know the common traits of beauty and what new should be done or innovated to make sure that the destination country receives the products well.
Reference
Bianchi, R., 2014. Interest groups and political development in Turkey. Princeton University Press.
Balasubramanyam, V. and Togan, S. eds., 2016. The economy of Turkey since liberalization. Springer.
Bu?ra, A. and Sava?kan, O., 2014. New capitalism in Turkey: The relationship between politics, religion and business. Edward Elgar Publishing.
Çaha, Ö., 2016. Women and civil society in Turkey: Women’s movements in a Muslim society. Routledge.
Davis, P.J., 2012. A model for strategy implementation and conflict resolution in the franchise business. Strategy & Leadership, 40(5), pp.32-38.
Dratler Jr, J., 2017. Licensing of intellectual property. Law Journal Press.
Gray, S., Harymawan, I. and Nowland, J., 2016. Political and government connections on corporate boards in Australia: Good for business?. Australian Journal of Management, 41(1), pp.3-26.
Irwin, D.A., 2015. Free trade under fire. Princeton University Press.
Keup, E.J. and Keup, P.E., 2012. Franchise bible: How to buy a franchise or franchise your own business. Entrepreneur Media.
Kumar, V., Gaur, A.S. and Pattnaik, C., 2012. Product diversification and international expansion of business groups. Management International Review, 52(2), pp.175-192.
Liesch, P.W., Welch, L.S. and Buckley, P.J., 2014. Risk and uncertainty in internationalisation and international entrepreneurship studies. In The Multinational Enterprise and the Emergence of the Global Factory (pp. 52-77). Palgrave Macmillan, London.
Shenkar, O., Luo, Y. and Chi, T., 2014. International business. Routledge.
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