MSG Team's other articles

12469 Big Data and the Power to Predict

Is Big Data a Magic? We often hear the term Big Data being used to describe how online retailers as well as mega corporations are targeting the consumer behavior by having the power to predict, sense, and intuit future consumer decisions. Indeed, Big Data is talked about in hushed tones with a sense of awe […]

9410 Functions of a Good Product Manager

Astute product management requires the product manager’s involvement at every phase of the product lifecycle. Starting with the initial conceptualization and coordination with the different departments, including liaising with finance, legal and other teams, and finally, driving the product to launch and after sales service by interacting with the sales and marketing functions. To take […]

13044 Cutting Costs Strategically

The business environment today has become extremely competitive. Companies are not only facing competition from their local competitors but also from global ones. Different economic and geopolitical factors make global supply chains necessary. The problem with having global supply chains is that operations become broad and complex. It is much easier to manage operations located […]

12881 Analyzing Consumers Buying Behaviour

The core function of the marketing department is to understand and satisfy consumer need, wants and desire. Consumer behaviour captures all the aspect of purchase, utility and disposal of products and services. In groups and organization are considered within the framework of consumer. Failing to understand consumer behaviour is the recipe for disaster as some […]

12594 Business to Business (B2B) Exchanges – Virtual Market on Internet

Ever since we stepped into internet world, we find a sea of change in the way people buy, communicate and socialize with one another. Internet has succeeded in erasing the boundaries and bringing markets together. Today it is possible for one to sit in the comfort of his home or office and search for information […]

Search with tags

  • No tags available.

The growth of international retailing business has been a field of study by the academic researchers for the past four decades. Various academicians like Alexander and Kacker have been trying to understand the factors that led to the development of internationalisation of retail business since 1990s. By international retailing we are referring to both the two major categories of international grocery retailing as well as fashion retailing segments.

One school of thought has established the factors that have encouraged the companies to look at foreign shores for expansion of their business. The factors identified include Unique Ownership advantages where in proven brand, specific and unique style as well as factors like trademark ownership on fashion design and brands etc can push the Company to make use of the situation and extend its business into new markets {in the absence of new and increased opportunities in domestic market} and thereby gain from increased business activity. Alternatively location specific advantages in terms of attractiveness of the foreign markets as well as supplier base is said to induce the retailers to consider setting up international operations.

Yet another group has studied the development of international retail wherein European Companies made their entry into American markets and built successful businesses. Accordingly it has been said that a host of pull and push factors have lead to the internationalisation of retailing. The lack of growth in the domestic market and the new opportunities in growing markets abroad pushed the European especially British firms establishing operations in American markets. The domestic market in Europe being under Government control and regulation did not provide sufficient opportunity for growth while the American socio-economic climate was conducive for phenomenal growth in the retail sector.

Despite several viewpoints being put forth by the researchers, the growth of the major international retailers like Wal-Mart, Carrefour, Ahold and Tesco seem to point out to the fact that the internationalisation of business was a part of strategic initiatives taken by the Companies and not necessarily a turn of events that pushed them to look abroad for their business survival.

Internationalisation of retailing business is not as easy to set up when compared to the other kinds of businesses. Internationalisation of operations which is the most important aspect of the business is faced with several challenges in terms of local socio economic environment coupled with political and lifestyle as well as cultural environments in the foreign markets. The international retailers have had to understand the local dynamics and respond to the challenges in a bid to be successful. Therefore it may also be said that internationalisation of retailing grew with experience and the process of internationalisation evolved over a few decades.

International retailers in the initial stages have chosen to expand and set up business in the foreign markets which are geographically closer and in the neighbourhood. Over the period of a few years, they have understood the market dynamics and the challenges and accordingly developed market intelligence as well as the processes and operational methods suited for foreign operations. These then have been internalised and helped the Companies develop an international operations strategy and understanding that enabled them to make entries into culturally diverse and geographically distant markets.

With time and experience the Companies gained experience and expertise which gave them the confidence to explore unchartered territories and set up business operations.

Another point to be noted is that the internationalisation of retailing turned out to be the long term and strategic direction that these companies chose to take. Internationalising therefore became a part of the engine that fuelled future direction and growth of business for most of the successful international retailers.

Article Written by

MSG Team

An insightful writer passionate about sharing expertise, trends, and tips, dedicated to inspiring and informing readers through engaging and thoughtful content.

Leave a reply

Your email address will not be published. Required fields are marked *

Related Articles

International Retail Store Design Principles – The Principle of Totality

MSG Team

Retail Fashion Industry and Youth

MSG Team

Retail Fashion Advertising for Youth

MSG Team