BSA480 Global Business Plan Project – Assignment Solution

Global Business Plan Project

 

Overview

Every organization conducts research to plan and implement a business idea.  This project is designed to provide the foundation for an international business plan.  These activities offer flexibility for many settings related to global business enterprises.  The framework may be used for planning global expansion of an existing product or service or may be used to research a new foreign business opportunity.  Each module of this project is designed to gather information for one component of an international business plan.

 

The final result of your global plan should be in one of the following formats:

• a written report with supplementary tables and visuals.
• an oral presentation with visuals.
• a summary in a poster format or other visual display (web site, video, newsletter).

 

Note: While the research components in each module are designed to provide a comprehensive analysis of this aspect of a business plan, selected items may be used to gather information for a specific element.

 

Table of Contents

 

Phase 1 – Planning the Global Business Enterprise

MODULE 1 – Identifying Global Business Opportunities

• Determine potential international markets for existing or proposed goods and services

 

MODULE 2 – Analyzing International Competitors

• Identify domestic and international companies involved in similar business global business activities

 

MODULE 3 – Assessing the Economic-Geographic Environment

• Examine geographic and economic factors that affect the business environment of a nation

 

MODULE 4 – Assessing the Social-Cultural Environment

• Research social institutions, customs, traditions, and beliefs influencing business

 

MODULE 5 – Assessing the Political-Legal Environment

• Research the influence of government and regulations on business activities

 

 

PHASE 2 – Organizing for Global Business Activities

MODULE 6 – Selecting a Global Company Structure

• Suggest objectives and an organizational framework for global business operations

 

MODULE 7 – Financing Sources for Global Business Operations

• Project start-up costs and funding sources for international operations

 

MODULE 8 – Creating a Global Management Information System

• Identify needed databases and information systems to facilitate international business activities

 

MODULE 9 – Identifying Human Resources for Global Business Activities

• Gather information on needed personnel for operating an international enterprise

 

MODULE 10 – Managing International Financial and Business Risks

• Identify methods for reducing global business risks

 

PHASE 3 – Implementing the Global Market Plan

MODULE 11 – Product and Target Market Planning for Foreign Markets

• Identify specific attributes and customer benefits for a proposed international product or service

 

MODULE 12 – Designing a Global Distribution Strategy

• Analyze distribution channels and intermediaries for global business operations

 

MODULE 13 – Planning a Global Promotion Strategy

• Suggest advertising messages, media and other promotional activities for an international enterprise

 

MODULE 14 – Selecting an International Pricing Strategy

Recommend a global pricing strategy based on costs, market demand, competition, and economic environment

 

PHASE 4 – Implementing the Global Market Plan

MODULE 15 – Determining Financial Results

• Estimate revenue and costs based for international business activities

 

MODULE 16 – Measuring International Business Success

• Suggest potential criteria for global business accomplishments based on financial results and social contributions

 

 

Module One – Identifying Global Business Opportunities

 

Learning Goals

 

1. To assess factors that create international business opportunities
2. To identify potential global business opportunities for various foreign markets

Purpose

Some organizations attempt to expand their international operations by seeking foreign markets appropriate for existing products and services.  Other enterprises assess foreign business environments in an attempt to meet needs in those markets.

In this first module, you will conduct a preliminary assessment of geographic, economic, social-cultural, and political-legal factors that create global business opportunities in foreign markets.  Also, you should consider how technology could create new foreign business opportunities by expanding possibilities for production, marketing, and distribution of goods and services.

BACKGROUND

Global Business Opportunities

Potential foreign business opportunities may be viewed in two major categories:

1. Various country factors create international business opportunities. These include:

• Natural resources, agricultural products, or geographic factors (climate or terrain)
• Level of economic development and infrastructure
• Cultural characteristics, social activities, or demographic trends
• Changing political situations or legal factors
• Technology that may enhance production or distribution of an item

 

1. Existing companies attempting to expand into new markets around the world—List several possible global business opportunities that would be the basis for new or expanding international business operations. These business opportunities may be consumer goods or services; or organizational goods and services, sold to businesses, government agencies, nonprofit organizations, schools, hospitals, hotels, or other organizations.

 

Examples of global business opportunities include: processing of fresh fruit in Chile for distribution around the world; sale of water filtration systems in developing economies; sale of food products adapted to the tastes of different cultures; development of cellular telephone systems in countries with a weak communication infrastructure; and expansion of fast-food restaurants into countries with expanding economies.

                Resources

Web links:

• Global Edge CyberSite: http://www.globaledge.msu.edu/
• Business Around the World Atlas: https://highered.mcgraw-hill.com/sites/0078137217/student_view0/business_around_the_world.html

(Works best with Firefox.)

Conduct Research

Collect data and information to use in formulating this aspect of your business plan by answering the following questions.

1. POTENTIAL MARKETS

Discuss one or more of the global business opportunities from above in terms of:

• a specific product or service, including customer benefits; and
• a potential market—a country that would be appropriate for this business opportunity.

 

2. ABSOLUTE AND COMPARATIVE ADVANTAGES

Analyze for the presence of an absolute or comparative advantage that might be related to a business opportunity in the country where the item will be produced or sold.  Describe how this analysis might influence the success of your proposed business idea.  (For example, the availability of natural resources can make a business opportunity cost efficient.)

 

3. BUSINESS OPPORTUNITY ANALYSIS

Compare two or more proposed business opportunities based on factors such as foreign market potential, start-up costs, and foreign business risks.  (For example, a proposal to construct new highways may be appropriate for a developing economy.  However, the risks in this market are probably greater than in an industrialized nation.)

                Supplementary Activity

Research the international operations of a company doing business in several countries.  Obtain information related to:

1. the products sold in various regions of the world;
2. current and planned business activities in specific regions of the world—Asia, Africa, Eastern Europe, Middle East, Latin America;
3. the company’s strengths and weaknesses related to global business activities;
4. future actions that might be suggested for the company’s international operations.

 

E-Commerce Application

Identify an online business application (such as providing product information, selling online, or ordering from suppliers) that would be appropriate in the proposed foreign market or that could enhance the promotion or distribution of your proposed business opportunity.

Prepare Summary

In a separate Word document, prepare a summary report entitled: Global Business Opportunities consisting of the following components:

1. An overview of geographic, economic, cultural, political, and technological factors that creates the proposed global business opportunity.
2. A description of the potential market for this product or service.
3. A synopsis of any absolute or comparative advantages (as applicable).
4. Recommend one or more foreign business opportunities (with a specific foreign market) for an existing company or a new enterprise. Provide evidence to support your proposal.

View Sample Report

The following project segments are EXAMPLES and SAMPLE MATERIALS.  Please note:

• these samples were selected from several student team projects at one school and are not intended to represent a particular level of quality, and DO NOT represent a complete project
• the accuracy of content, data, and clarity of writing are NOT guaranteed; and
• these samples may NOT BE DUPLICATED.

SUBWAY’s mission is to provide Brazilian consumers with a healthy and quick alternative in the fast-food market.  By providing made-to-order sandwiches, we are meeting the needs of the ever-growing, fast-paced and health-conscious Latin American community.  Our goal is to provide value, service and convenience to our customers.  SUBWAY plans to equal or exceed the number of outlets operated by McDonald’s, currently Latin America’s largest fast-food company.  With our system and operational strengths, dedicated personnel are willing to meet the expectations of consumers.  We believe that our SUBWAY franchise will continue to grow and be successful in the Latin American market.

SUBWAY is the largest submarine sandwich chain in the world and is rapidly expanding internationally.  SUBWAY has more than 14,100 stores in over 73 countries, making it the second largest restaurant chain overall.  The brand was introduced in 1974 and today, all locations are franchised.  From 1987 to 1999, the SUBWAY franchise has been ranked #1 Submarine Sandwich franchise in Entrepreneur’s Franchise 500 listing.  For eight times in those past twelve years the SUBWAY system was #1 franchise overall, beating out other fast food franchising giants and all other franchises.  In Entrepreneur International’s 1999 Top 200 ranking, SUBWAY was placed third out of the world’s top 200 franchises.  Latin America is among the growing markets for SUBWAY franchises, with over 215 stores already in this area.

The Happy Harbor Company’s mission is to improve global exporting and importing that enhances economic activity.  The objectives of the company are to construct profitable harbors that will help boost the country’s trading capacities, increase trade between countries with already existing harbors, and create jobs and a higher standard of living for the people of Latin America.

The Happy Harbor Company is there so that countries that do business with Latin America do not have to think of how to get their goods into the countries and where the best harbors are located.  The Happy Harbor Company provides the construction of the harbors and seaports for countries that are in need of better facilities for trading on their coastal borders.  The company is also here to help companies in other countries to locate their goods.  Latin America has a growing economic base and the Happy Harbor Company wants to be there to help not only the countries of Latin America, but also the many international companies that would benefit greatly from conducting business with the Latin American economy.

Translated from Spanish, our product name simply means “Good Health.”  As we are a U.S. company entering into a foreign market, and, therefore, bound to meet with cultural differences, it is important that there be no confusion caused by complicated names and slogans lest we are faced with language and cultural problems.  Our slogan is also quite simple, although it does have two slightly different, yet equally valid, translations.  The first is simply “The vitamins for the whole world,” which stresses the multinational aspect of our operations.  We wish to provide “Good Health,” literally and figuratively, to the entire world through our vitamins.  The second, more slang-oriented, translation of our company’s slogan is “The vitamin for everyone.”  This translation implies, and rightly so, that this is the vitamin for everyone.  Indeed, our product is for everyone as it is a multi-vitamin that can be taken by adults, children, men, women, and so on.  More, though, about the particulars of our fabulous product will be revealed later.

 

 

Global Business Plan Project

Module 2 – Analyzing International Competitors

Learning Goals

1. To identify potential competitors related to a proposed global business enterprise
2. To determine the influences of competitors in global business

Purpose

As proposed enterprises or established companies enter foreign markets, lessons can be learned from the successes and challenges of other organizations.  In addition, awareness of competitors makes it possible to better plan and implement your global business activities.  In this module, your goal is to identify and analyze the international business operations of organizations related to the global opportunity you are exploring.

Resources

Web links:

• Global Edge CyberSite: http://globaledge.msu.edu/
• Business Around the World Atlas: https://highered.mcgraw-hill.com/sites/0078137217/student_view0/business_around_the_world.html

Conduct Research

Based on the global business opportunity identified in Module 1 (or a different international business enterprise or idea), research information related to the following:

1. POTENTIAL COMPETITORS

Identify companies that:

1. have business activities similar (or related) to the business opportunity you are proposing; and
2. operate in the country (or countries) that you are considering for your international business enterprise.
3. COMPETITIVE ADVANTAGES

Discuss the competitive advantages of these companies.  (For example, some companies may gain a competitive advantage as a result of access to raw materials, others may gain an advantage using technology for production and distribution or as a result of a well-known brand name.)

3. INTERNATIONAL STRATEGIES

Compare the international business strategies of these companies.  Do these companies make use of standardized products and operating policies?  Or, do they use a strategy that is adapted to various foreign markets?  (Film is sold in standardized formats around the world while laundry detergents are adapted to clothes washing habits and water hardness.)

Supplementary Activity

Interview people who work in similar companies, related industries, or potential suppliers for your business idea.  Obtain information about the product or service that might enhance your knowledge of this type of business.

E-Commerce Application

As online operations increase, companies seek new expanded markets and additional business activities.  Describe situations in which the competitive environment has changed as a result of e-commerce activities.

Prepare Summary

In a separate Word document, prepare a summary report consisting of the following components:

1. A discussion of potential competitors and their global business activities.
2. A synopsis of global business strategies that could create competitive advantages.

View Sample Report

The following project segments are EXAMPLES and SAMPLE MATERIALS.  Please note:

1. These samples were selected from several student team projects at one school and are not intended to represent a particular level of quality, and DO NOT represent a complete project.
2. The accuracy of content, data, and clarity of writing are NOT guaranteed; and
3. These samples may NOT BE DUPLICATED.

The Happy Harbor Company has competition in the form of other harbors, including the ports in Callao, Illo, Paita, Salaveryy, Iquitos, and Yurimaguas.  However, our harbor differs from our competitors because we not only offer competitive service at a lower price, but we offer an entertainment sector as well, which will improve the surrounding economy.

The fast-food market is very young in Brazil.  The Brazilian people have the luxury of eating at McDonalds.  We believe that the market will be very competitive between McDonalds and us.  This market, however, will not be half as competitive as it would be in the United States.  We believe that we can gain a solid portion of McDonalds’ market share using product differentiation.

Coche Libro will have a competitive advantage in Bolivia.  One reason is that this service will be unique for the country and surrounding countries.  Its biggest competitor will be the public library system.  However, we are confident that people will be attracted to the services we have to offer.  Due to the advancement of e-commerce, we will be assured that many will be able to access our company via the Internet.  Also, due to technological developments of highways, more areas of Bolivia will be accessible.  We will also have an advantage because we will be using the most up-to-date resources thanks to our alliance with Ford and Apple.

In response to demonstrated needs of the Bolivian market, new services are being developed to include minor checkups, blood pressure testing, mammograms, and infant and child immunizations.  These new services would be especially useful to rural Bolivians who can now easily obtain them during one of the many convenient Healing Wheels routine stops.  These needs are not only local to Bolivia, and as previously stated, perhaps Healing Wheels can answer some of the needs of other Latin American countries in equal need.

 

 

Global Business Plan Project

Module Three – Accessing the Economic-Geographic Environment

Learning Goals

1. To identify economic and geographic factors on international business activities
2. To assess economic and geographic influences on proposed global business operations

Purpose

The natural infrastructure (such as rivers and seaports) and physical infrastructure (transportation and communication systems) of a nation provide the foundation for economic development.  In this module, your goal is to gather information on various geographic and economic factors that include business opportunities in other countries.

Resources

Web links:

• Global Edge CyberSite: http://globaledge.msu.edu/
• Business Around the World Atlas: https://highered.mcgraw-hill.com/sites/0078137217/student_view0/business_around_the_world.html

Conduct Research

Based on the country (or countries) you are analyzing for your global business enterprise, research information related to the following areas:

1. GEOGRAPHIC INFLUENCES

Identify geographic factors (climate, terrain, waterways) that influence business activities in the country.  (In some countries, mountains make movement of raw materials and production supplies difficult and expensive.)

2. MAJOR PRODUCTS AND INDUSTRIES

Describe the country’s:

1. main natural resources and agricultural products,
2. major industries,
3. major imports, and
4. major exports.

(A country’s natural resources and agricultural products are the basis for foreign investment and exporting activities.)

3. CURRENT ECONOMIC CONDITIONS

Assess the country’s recent economic conditions related to GDP, inflation, interest rates, currency value, personal income, and employment.  Suggest how these economic factors may attract or deter foreign investment.

4. INFRASTRCTURE

Analyze the infrastructure of the country regarding availability of transportation, communication, and utilities.

Supplementary Activity

For the country (or countries) you are researching, monitor recent trends of the value of its currency on world markets.  Discuss factors that have influenced the exchange rates.

E-Commerce Application

Research Internet access in other countries to determine potential e-commerce activities in those foreign markets.

Prepare Summary

In a separate Word document, prepare a summary report consisting of the following components:

1. A synopsis of geographic factors, natural resources, major industries, imports, and exports for the country (or countries) being considered for the proposed global business enterprise.
2. An overview of the economic environment and infrastructure.
3. Recommend actions that might be taken for existing or proposed businesses related to geographic and economic influences in this foreign market environment. Provide evidence to support your proposal.

View Sample Report

The following project segments are EXAMPLES and SAMPLE MATERIALS.  Please note:

4. These samples were selected from several student team projects at one school and are not intended to represent a level of quality, and DO NOT represent a complete project.
5. The accuracy of content, data, and clarity of writing are NOT guaranteed; and
6. These samples may NOT BE DUPLICATED.

Geographically speaking, Latin America is as diverse a terrain as one would hope to find.  There are mountains, most notably the Andes, two oceans, numerous major rivers, rainforests, deserts, and even some Antarctic territories.  “Nature has presented the inhabitants of South America with an unrelenting challenge.  On the west coast, most of the major cities are in geologically active zones.  All too frequently, earthquakes, tidal waves, volcanic activity and mudslides have taken a staggering toll of human life.”

Linked to this difficult terrain is that, in many of the region’s poorer countries, the physical infrastructure is less than desirable.  Often, there is only one two-lane road to reach destinations and, as we have seen in the video of the Amazon, sometimes there are no roads at all.  The absence of viable roads, as well as the lack of enough transportation, makes it difficult for residents of rural areas to receive medical care. In some countries, like Brazil, for instance, there is only one doctor for every 681 people, partially due to the lack of infrastructure.  In comparison, Argentina (one of the region’s most rich and resourceful countries) has one doctor for every 376 people, which is still a low ratio by U.S. standards.  The people of Latin America, then, often incur difficulties reaching one of their few available doctors.  A multi-vitamin like our product would provide them with pro-active and preventative medical treatment so that they would be better protected against the sickness and infection that requires medical care.

The geographic factors of Brazil have enticed our team to bring a SUBWAY franchise to this country.  We believe that the mostly tropical climate in Brazil is ideal for our product.  The terrain, which is somewhat treacherous, should not be a problem for distribution because corporate SUBWAY will handle the delivery of our supplies.  The franchises that we plan to open will be in urban areas where the infrastructure is more stable; this will ensure safer arrival of our supplies and our customers.

Geographically, Bolivia is the only country in Latin America that is landlocked.  The country is bounded by Brazil to the north and east, Paraguay to the southeast, Chile to the southwest, and Peru to the northwest.  The Andes mountain range runs through the country, dividing it into three geographical zones: the mountain ranges to the West, the semitropical Yungas and temperate valleys of the eastern mountain slopes, and the tropical lowlands or plains of the eastern lowlands.  Although Bolivia is within tropical latitudes, climatic conditions go from tropical conditions in the lowlands to cold polar conditions in the highest parts of the Andes.  Temperatures differ due to elevation and there is little seasonal variation.

Many geographical factors will influence the market potential for our product.  The main aspect includes Peru’s coastline; with the 2,414 kilometers of coastline, it makes it very accessible to ships to come in and out of our port.  An unfortunate consequence that our company will have to deal with is the possibility of natural hazards.  Within Peru, earthquakes, flooding, and landslides are all within the realm of occurring.  In addition to this, mining wastes have increasingly been polluting the coastal waters of Peru.  However, we believe that our harbor will help eliminate this due to the sponsorship that we plan on providing.  We will have the financial means to help clean up both the rivers and coastal waters of Peru.  Helping the country in hazard relief is just one way our company is planning to give back to the country in which we operate.

Shipping products from our harbor to companies within Peru can be seen as a slight problem mainly because there are 64,793 kilometers of unpaved highways.  However, the Amazon system more than makes up for this problem with the 8,600 kilometers of navigable tributaries that it provides.

The town of Chiclayo has been chosen as the target city for a possible business venture due to its great geographical location.  Chiclayo is located on the upper coast of Peru and has possible roadways to the Amazon which offers a tremendous amount of trade with countries such as Brazil and other countries on the eastern side of South America.

Bolivia has enough roadways within its rugged terrain.  Although not all the roads are paved as ideally as in the United States, our trucks are Ford tough backed with four-wheel drive and come equipped with the off-road package for the less developed areas.  The climate is ideal for our service.  We do not have to deal with snow, but we may need to deal with spells of heavy rain.  (However, by going on-line to our company site, one can reserve books and we can drop the books off at their desired location.)  One hindrance will be due to the high elevation of some of the plateaus, which will lead to the combustion of the gasoline and will cause inefficiency (www.odci.gov).

The infrastructure in Brazil is more adequate for our franchise.  Brazil has over 30, 133 km of railroads, 1,670,148 km of highways and 50,000 km of inland waterways.  This is more than enough infrastructure to successfully cater to our business.

Telecommunications in Brazil are very good.  Brazil has extensive microwave radio facilities, 9.86 million telephones, TV and AM/FM radio, short-wave, 3 coaxial submarine cables, and 3 Atlantic Ocean INTELSAT earth stations and domestic satellite earth stations.  There is enough communication power here for NASA let alone a sandwich shop.

In 1997, Peru had economic growth of 7.3%, with inflation at an all-time low of only 6.7%, which is a great rate when compared to other Latin American countries. The economy grew vigorously in past years, with tourism and telecommunications leading the advance.  This is good for global business, as the economic stability will lead to increased profits for our company.  The Peruvian economy has become increasingly market-oriented, with major privatizations completed since 1990 in the mining, electricity, and telecommunications industries.  Foreign investments have helped push GDP growth to 7.3% in 1997 with inflation at its lowest levels in 23 years.

Because Bolivia is one of the poorest and least developed countries in Latin America (literacy rate- 83%) infrastructure may be an issue.  Not everyone will have a computer, so many will not be able to access our on-line services.  And, many may not make it to sporting events, so some may not know about El Coche Libro during its introductory stages.  Our aim is to have enough trucks around that our service will be spread through word of mouth and we will gain brand recognition (www.odci.gov).

Upon the arrival of the 1990s, the Brazilian economy was declining in growth and was experiencing serious inflation.  This led the Brazilian government to keep the economy highly regulated.  The government utilized trade barriers and investment barriers to protect the unstable economy.  This could be a bit of a problem for our plan, but in recent years the government has been moving to a free trade, unregulated economy.  The Real Plan resulted in a significant increase in the real income of poorer Brazilians as they were no longer forced to bear the inflationary burden.  The Real Plan has effectively lowered the annual rate of inflation, reformed social security, taxation, and public administration.  Therefore, the demand for consumer goods and services has exploded in Brazil.

 

 

Global Business Plan Project

Module Four – Accessing the Social-Cultural Environment

Learning Goals

1. To assess social and cultural influences of global business activities
2. To identify potential adaptations

Purpose

A country’s business environment may be influenced by the importance of family, religious beliefs, and demographic trends.  In this module, your goal is to gain cultural and social awareness about the country (or countries) you are considering for your global business opportunity.

Resources

Web links:

• Global Edge CyberSite: http://globaledge.msu.edu/
• Business Around the World Atlas: https://highered.mcgraw-hill.com/sites/0078137217/student_view0/business_around_the_world.html

Conduct Research

Based on the country (or countries) you are analyzing for your global business enterprise, research information related to the following areas:

1. DEMOGRAPHIC TRENDS

Identify demographic trends (such as birth rates, literacy rates) that might influence business activities in the country. (Lower birth rates result in an aging population with expanded demand for health care.)

2. CULTURAL ANALYSIS

Discuss language, customs, traditions, and beliefs of the country.  (Religious beliefs may make the sale of certain products inappropriate in some countries.)

3. SOCIAL INSTITUTIONS

Analyze the influences of social institutions (family, church, labor organizations) on the business culture.  (In some countries, a strong tie exists between family and business.)

4. INFORMAL TRADE BARRIERS

Describe informal trade barriers created by social and cultural factors.  (Communication styles and negotiating tactics vary around the world resulting in the need to adapt to the host country’s culture.)

 

 

Supplementary Activity

Interview a person who has lived in, worked in, or traveled to a country you are researching.  Obtain information related to eating habits, shopping, leisure activities, the role of family and religion, customs, traditions, and other aspects of the business environment.

E-Commerce Application

Locate web sites designed to meet varied cultural needs of Internet users in other countries.  Identify specific adaptations related to format, language, colors, pricing, product offerings, and other features of the web sites.

Prepare Summary

In a separate Word document, prepare a summary report consisting of the following components:

1. An overview of demographic trends that could influence global business activities.
2. A description of cultural factors, social institutions, and informal trade barriers that could affect global business activities.
3. Recommend actions for existing companies or new enterprises that might be necessary when considering the social and cultural environment of the foreign market. Provide evidence to support your recommendations.

View Sample Report

The following project segments are EXAMPLES and SAMPLE MATERIALS.  Please note:

7. These samples were selected from several student team projects at one school and are not intended to represent a level of quality, and DO NOT represent a complete project.
8. The accuracy of content, data, and clarity of writing are NOT guaranteed; and
9. These samples may NOT BE DUPLICATED.

Society is becoming faster-paced and more industrialized, creating a market opportunity in healthy fast food.  Cultural tastes of Brazil range so widely that our sandwiches can be customized to various tastes.  Brazilians prefer freshness and natural foods as opposed to fast food, which dominate Brazil’s franchise market, and is a growing concern in Brazil for healthy alternatives to their current way of life.

Socially and culturally, Bolivian people have a strong Catholic belief, with 95% of their people being Roman Catholics.  People are very friendly and welcome new ideas, and new institutions.  The adult literacy rate is 80% as of 1998; El Coche Libro will try to increase this number to 90% in the first 5 years of operation.

The social contributions of Costa Rica deliver positive indicators of a successful country.  Astonishingly, 95% of Costa Rica’s population above the age of 15, can read and write showing the strength in the Costa Rican education system from pre-school through the university level.  Spanish is the official language with few dialects, and 95% of the religious community is Roman Catholic.  Costa Rica’s population reaches 3.5 million with concentrations around urban centers.  Whirlpool will easily be able to find skilled and reliable hotel employees in Costa Rica.

 

 

Global Business Plan Project

Module Five – Accessing the Political-Legal Environment

Learning Goals

1. To assess political and legal influences on international business activities
2. To identify appropriate strategies for operating in various political-legal environments

Purpose

Political stability is commonly related to the type of government and degree of corruption present in a country.  In addition, a company may face various business regulations when conducting international business.  In this module, your goal is to identify political and legal factors that could affect global business decisions.

Resources

Web links:

• Global Edge CyberSite: http://globaledge.msu.edu/
• Business Around the World Atlas: https://highered.mcgraw-hill.com/sites/0078137217/student_view0/business_around_the_world.html

Conduct Research

Based on the country (or countries) you are analyzing for your global business enterprise, research information related to the following areas:

1. GOVERNMENT AND POLITICS

Describe the type of government and recent political developments that could influence the economic and business environment of the country.  (For example, various events in recent years in the Middle East have contributed to an uncertainty when doing business with some countries.)

2. FORMAL TRADE BARRIERS

Identify formal trade barriers (tariffs and other taxes, foreign exchange controls, ownership restrictions) that might require a company to adapt its business strategy.

3. PROMOTING GLOBAL BUSINESS

Analyze host government efforts to attract foreign investment.  (Some nations offer tax incentives to attract foreign capital.)

4. INTELLECTUAL PROPERTY

Discuss the country’s regulations to protect intellectual property, such as brand names, copyrights, patents, software, music, videos.  (Some countries do not enforce these laws resulting in the pirating of products and lost profits for companies.)

 

Supplementary Activity

Conduct a survey of local businesspeople who are involved with or aware of political and economic trends around the world.  Obtain information related to their assessments of which regions are the best prospects for international business expansion.

E-Commerce Application

Research possible restrictions or taxes imposed for online activities in other countries.  Describe how these government actions could affect global business operations.

Prepare Summary

In a separate Word document, prepare a summary report consisting of the following components:

1. An overview of government regulations, taxes, and formal trade barriers that affect global business activities.
2. A synopsis of intellectual property rights and regulations.
3. Recommend actions that might be necessary for an existing company or a new enterprise regarding factors in the political and legal environment. Provide evidence to support your proposal.

View Sample Report

The following project segments are EXAMPLES and SAMPLE MATERIALS.  Please note:

10. These samples were selected from several student team projects at one school and are not intended to represent a level of quality, and DO NOT represent a complete project.
11. The accuracy of content, data, and clarity of writing are NOT guaranteed; and
12. These samples may NOT BE DUPLICATED.

Politically, Peru is currently quite stable.  Harbors will give Peru an opportunity for expanded foreign trade giving them stronger exporting ties and therefore increasing political relations with other Latin American countries.  Current political risks include the presidential election going on which might change certain tax factors that could directly affect the importing and exporting activities.  In addition, the threat of guerilla upheaval on the government is a direct risk the company must consider.

Consumer and Franchising Laws have enabled companies to franchise their businesses more steadily as the government moves toward an unregulated, free trade economy.  The Real Plan has resulted in a significant increase in the real income of poorer Brazilians as they were no longer forced to bear the inflationary burden.  The Real Plan has effectively lowered the annual rate of inflation, reformed social security, taxation, and public administration.  Therefore, the demand for consumer goods and services has expanded in Brazil.

Politically, Bolivia has had its share of instability, having gone from dictatorships to democratic rule.  The military rule was in effect until very recent years, from 1964 until 1982.  After this, Bolivia became a democratic country.  Today, the government of Bolivia is a republic that is very active in foreign trade.  The government is especially cooperative with educational resources, and they strongly support educational institutions (like El Coche Libro), and services.

Government regulations that our company will have to deal with include Peru’s current system of tariffs and taxes.  Currently, Peru has a two-tier tariff structure with a duty of 15% on most imports and 25% on the rest.  However, Peru does have in effect a simplified drawback scheme, which allows small exporters to claim a flat 5% rebate.  Since the beginning of 1991, Peru has applied surcharges (in addition to the 15% tariff) on numerous agricultural products, including wheat, rice, corn, sugar, and milk products, but recently these surcharges have all but become extinct.  Peru is also involved in free trade agreements, which grant tariff preferences to most Latin American countries.  A positive aspect of operation in Peru is the elimination of non-tariff barriers, including subsidies, import licensing requirements, import prohibitions, and quantitative restrictions.

Costa Rica has a stable democratic political system.  “Bilateral relations between the United States and Costa Rica remain excellent, reflecting shared democratic values and traditions” (www.usatrade.gov).  In February 1998, national elections voted in Miguel Angel Rodriguez of the Social Christian Party over Jose Miguel Corrales of the National Liberation Party.  In 1983, President Luis Alberto Monge announced Costa Rica’s permanent neutrality creating a demilitarized country, in which their constitution prohibits armed forces, only allowing room for the Coast Guard.  Costa Rica is nicknamed the “Switzerland of Central America.”  Tourists will be able to feel safe and secure when visiting this country.

 

 

 

Global Business Plan Project

Module Six – Selecting a Global Company Structure

Learning Goals

1. To assess various entry modes for global business operations
2. To recommend strategic alliances for proposed international business activities

Purpose

As a business organization enters new foreign markets, decisions must be made regarding various organizational factors.  In this module, your goal is to develop a strategic plan related to an enterprise’s strategic goals and organizational structure.

Resources

Web links:

• Global Edge CyberSite: http://globaledge.msu.edu/
• Business Around the World Atlas: https://highered.mcgraw-hill.com/sites/0078137217/student_view0/business_around_the_world.html

Conduct Research

Based on the country (or countries) you are analyzing for your global business enterprise, research information related to the following areas:

1. STRATEGIC PLANNING

Develop strategic objectives that communicate major goals related to:

1. product (or service) offerings,
2. target market and customer benefits,
3. financial aims (market share, return on investment),
4. employee satisfaction, and
5. social contributions.

(Strategic goals are commonly stated in a manner that can be measured objectively, such as “to provide households with clean drinking water at a moderate price.”)

2. ENTRY MODES

Analyze different global business entry modes that a company might select when planning international business activities.  Compare the benefits, costs, and risks associated with using exporting, turnkey projects, management contracting, licensing, franchising, contract manufacturing, joint venture, and wholly-owned subsidiaries.  (In general, exporting has less risk than some of the other entry modes.  The product or service, as well as the economic, social-cultural, and political-legal environment of the country, will influence an organization’s entry mode.)

3. ORGANIZATIONAL STRUCTURE

Discuss the extent to which the organization will use centralization and decentralization.  (Centralized organizations tend to offer standardized products or services with decisions made in upper levels of the organization.  In contrast, decentralized organizations usually involve products or services that need to be adapted to various geographic, economic, social-cultural, and political-legal influences.)

4. STRATEGIC ALLIANCE

Identify local companies of the country or international companies operating in the country that could be a business partner.  These strategic alliances may be suppliers, distributors, sales representatives, or consultants.  (For example, a bottled water company might reach an agreement to transport and sell its product through the existing distribution system or a soft drink company.)

Supplementary Activity

Prepare an in-class presentation (and visual) comparing alternative entry modes for implementing international business activities.  These could include exporting, turnkey projects, licensing, franchising, joint venture, and wholly-owned subsidiaries.

E-Commerce Application

Based on your proposed global enterprise, suggest an online strategic partnership with a company that has a strong online presence.  Discuss how this agreement could benefit the parties involved.

Prepare Summary

In a separate Word document, prepare a summary report consisting of the following components:

1. A synopsis of the strategic objectives for the proposed global enterprise.
2. A description of potential global business entry modes that might be used.
3. An overview of centralized and decentralized organizational activities.
4. Recommend strategic alliances that could contribute to global business success. Provide evidence to support these recommendations.

View Sample Report

The following project segments are EXAMPLES and SAMPLE MATERIALS.  Please note:

13. These samples were selected from several student team projects at one school and are not intended to represent a level of quality, and DO NOT represent a complete project.
14. The accuracy of content, data, and clarity of writing are NOT guaranteed; and
15. These samples may NOT BE DUPLICATED.

The top priority of the Buen Salud vitamin company is to improve the health of its consumers.  These consumers include residents of both urban and rural areas of Latin America.  As Buen Salud is a small, independently-owned company, it was decided by its board of directors that a strategic alliance was needed to facilitate operation.  The company chose McNeil Consumer Healthcare, the world’s leading manufacturer and marketer of nonprescription pain-killers, such as Tylenol.  McNeil Consumer Healthcare seemed to be a prime candidate for such a joint venture as they are a company that prides itself on aiding and educating others.  They have established several programs to benefit those wishing to get started in the pharmaceutical world (see their website at www.mcneilcampusrecruiting.com).

Although usually willing to sponsor individuals rather than entire companies, there was still some work to be done to make this alliance a reality.  After some debate, however, McNeil has agreed to take Buen Salud under its wing and the agreement established is this: Buen Salud will have the use of Tylenol’s manufacturing plant in Argentina.  In return, Buen Salud has agreed to enter Chile and Brazil as our first markets and to use our distribution vehicles to distribute Tylenol to markets where it does not currently have a large presence (mostly rural areas of Chile and Brazil).

With respect to our global approach, we chose franchising.  We believe this approach combines our entrepreneurial drive and ambition with the experience and expertise of a larger company.  We will be selling a product that has been well accepted in many markets, giving us name recognition.  The operation and control of our business has already been established, assisting us in running the business.  In contrast to purchasing an independent business, buying a franchise is an investment not only in our store, but in the franchising company as well.  If the chain expands, our individual may build greater equity.  Government statistics have shown individuals starting a new business on their own have significantly higher failure rates than those investing in franchises.

We have chosen three specific strategic alliances to benefit our start-up plan.  First, we will be working with Casa Santa Luiza, a delivery company, for delivering meats and vegetables.  We will be putting our name on their trucks, so they get a household name associated with their company.  We will also be using Signexpress and Signs.now for promotions.  They will give us free signs, and in return, we will set up space in our store, which they can use to sell to other companies for advertising.  Finally, we will be using G-S-M Arguitetura e Design to build and renovate our store.  They will be cutting the cost of construction, and in return they are able to advertise outside our store that they were the store designers.

If we are going to have a strategic alliance with companies in Latin America for us to succeed, we will have major bookstores, libraries, gasoline companies, and sports teams (mainly the soccer team “The Strongest”).  We will ask them to help us in promoting our company (El Coche Libro) and run the company.  In exchange, we will help promoting (bookstore, gasoline, etc.) and support (sport teams) for these companies that are willing to help us, for a better future of their own country.

We will also have an alliance with ShopGenerosity.com.  This company is an Internet shopping mall and fundraising service for community-based arts, educational, and other nonprofit organizations.  Shoppers shop through www.shopgenerosity.com by first selecting a recipient nonprofit organization and then selecting from more than 70 of the Internet’s top merchants.  Partnering nonprofit organizations receive 50% of lead fee revenue and up to 25% of other revenue from ShopGenerosity.com.  Our participation with ShopGenerosity.com is risk and investment free.  By having a strategic alliance with an Internet shopping mall, we will be getting backed by consumers all around the world.

Our joint venture is a major source in the success for the project.  We must establish who will use our port once it is built.  Such companies, including exporting companies, will contribute to the main profits of our harbors.  Also, our company will include an entertainment segment that will increase the job market as well as the existing economy.

The production of our port should be conducted with a decentralized business plan.  Every time we open a new harbor, the size and the materials used to export and import products will determine the profits of the harbor.  Relationships with suppliers will be vital to the success of the construction of harbors by our company.  By establishing a construction force, the port-development process will be easily duplicated.

Healing Wheels has a centralized production strategy because each team of volunteers has a specific base and team leader in charge of each route and schedule.  This means that each sector has a centralized team and base.  The relationship with the suppliers will be kept up using Internet and e-commerce applications.

SAMPLE TIMELINE

May 15, 2000: Funding will be complete.  All capital will be available.  All paperwork concerning franchising agreement with corporate will be complete.

May 15-30, 2000: Management team will close deal on one of three locations in Brazil.  Letters of intent will then be signed and building construction will begin.

May 30- August 1, 2000: Building construction will be started and completed within these dates.

May 30- August 1, 2000: Management team will recruit and hire full team.  Training will take place at this time as well.

August 3, 2000:  Grand Opening: three days of promotions and carnival type atmosphere.  Appearance by Billy Blanks, Subway’s celebrity sponsor.

August 3, 2001: One-year evaluation.  If evaluation is sound, we will begin the planning of our second store.

 

 

Global Business Plan Project

Module 7 – Financing Sources for Global Business Operations

Learning Goals

1. To determine start-up costs for proposed global business operations
2. To identify sources of funding for international business activities

Purpose

Both global expansion by large organizations and initial international business activities by smaller companies require financing.  In this module, your goal is to obtain information related to start-up costs and sources of funds for your international business enterprise.

Resources

Web links:

• Global Edge CyberSite: http://globaledge.msu.edu/
• Business Around the World Atlas: https://highered.mcgraw-hill.com/sites/0078137217/student_view0/business_around_the_world.html

Conduct Research

Based on the global business opportunity identified in Module 1 (or a different international business enterprise or idea), research information related to the following:

1. ECONOMIC ENVIRONMENT

Discuss the influence of the country’s infrastructure and economic conditions (inflation, currency exchange rate, interest rates, unemployment, personal income) on startup costs and the financial potential for this business enterprise.

2. START-UP COSTS

Identify expenses (and estimated amounts) that would be necessary when starting this global business enterprise.  (Be sure to consider equipment, buildings, vehicles, infrastructure improvements, training costs, consultants, legal fees, and licenses.)

3. FINANCING SOURCES

Compare the availability and costs associated with different sources for funding this global business enterprise.  (Large companies may sell stock, issue bonds, and obtain loans.  Smaller organizations might make use of personal investors, small business loans, venture capital sources, or government-guaranteed loans.)

 

Supplementary Activity

Obtain recent currency exchange rates for the country you have researched.  Graph changes of these currency values in relation to two or three other countries.  Discuss economic and political factors that may have influenced any changes in the country’s exchange rate.

E-Commerce Application

Locate online information sources for organizations that provide funding for start-up enterprises involved in exporting and international business.  What requirements exist to obtain this funding?

Prepare Summary

In a separate Word document, prepare a summary report consisting of the following components:

1. An overview of economic conditions that might affect start-up costs and financing alternatives for the proposed global business enterprise.
2. A description (and estimate of amounts) of the necessary start-up costs.
3. A synopsis of financing alternatives that might be used in this situation.
4. Recommend actions that might be taken to obtain financing for the proposed global business enterprise. Provide evidence to support your recommendations.

View Sample Report

The following project segments are EXAMPLES and SAMPLE MATERIALS.  Please note:

16. These samples were selected from several student team projects at one school and are not intended to represent a level of quality, and DO NOT represent a complete project.
17. The accuracy of content, data, and clarity of writing are NOT guaranteed; and
18. These samples may NOT BE DUPLICATED.

Our harbor, which will span eight miles, will cost us approximately $3 billion to construct. The $3 billion will come from governments subsidizing the harbor, as well as from the sponsors.  Our project consists of excavation and dredging approximately 1,100 feet by 600 feet of flatland along the northwest margin of Peru in Chiclayo.  We will excavate a triangular area of approximately 230’ by 280’ by 360’ and will have a depth of 38’.  This will cost us approximately $13,900,000.  The estimate for this price was obtained by Healy Tibbitts Builders, Inc.

To sponsor harbors, the Happy Harbor Company will seek funding from three major American-based companies:  McDonalds, Pepsi, and Anheuser Busch.  These three major sponsors will provide money mainly for the entertainment and retail sector of the harbor.  The sponsors will help support our commitment to provide quality family entertainment throughout the year.  Their financial support will help underwrite a variety of free attractions and entertainment, and their advertising and promotional support will help us exceed the approximately 8.2 million visitors that we are expecting at our harbors each year.  Of the 8.2 million visitors the entertainment sector expects, the Happy Harbor Company hopes to earn $10 million a year.

For construction purposes, Caterpillar will be providing the materials and equipment for a minimal price as we advertise the benefits of their company to the governments in which we build our harbors.  This will make it profitable to build our harbors as well as expand Caterpillar’s business throughout the world.

Start-up costs will include a $10,000 initial franchising fee due upon signing the franchising agreement.  Approximately $60,000 will be needed to pay for the lease on the property and for the renovations that will be needed on our store.  Since we will be investing in SUBWAY internationally, we are not able to benefit from the equipment-leasing program through SUBWAY headquarters.  SUBWAY estimates equipment costs to be around $50,000, but through strategic alliances these costs will be cut by coming to agreements with equipment companies in Brazil.  Another $40,000 will be needed for expenses like opening inventory, signs, insurance, supplies, training expenses, opening advertising, and other miscellaneous expenses.  Operating costs will include labor, supplies, along with an eight percent royalty to SUBWAY weekly, and a three percent advertising fee.  Revenues will come from in-store sales, on-line sales, and catering to small and medium sized businesses.  Our pricing strategy will be to slightly increase the price of our products compared to American prices, with respect to the American dollar.

We have decided upon obtaining a small business loan from an American bank.  We believe that by doing this in America, we will decrease fears of loan problems due to a more stable economy in the U.S.  By having the luxury of the SUBWAY name, we believe banks will be much more comfortable approving our loan application.  We will also use the Billy Blanks Foundation for some start-up money.  That foundation has worked with corporate SUBWAY for several years starting up franchises internationally.

According to the opportunities and requirements for Buen Salud Vitamin Company described in this business plan and based on what we feel are sound business assumptions, our initial capital requirements are $6 million.  To accomplish this goal, we have developed a comprehensive plan to intensify and accelerate our marketing and sales activities, product development, services expansion, engineering, distribution, and customer service.  To implement our plans, we require a loan totaling $5 million for the following purposes:

1. Purchase initial materials and supplies (bottles, labels, ingredients, boxes for distribution, etc.)
2. Maximize sales with an advertising campaign to promote our products/services.
3. Reinforce Customer Support services to handle the increased demands created by an influx of new orders.
4. Purchase of vehicles to be used for large-scale distribution (semi-trucks).
5. Purchase of vehicles to be used for small-scale distribution (SUVs).
6. Facilitation of the licensing and patenting process.
7. Payment for legal fees incurred during research and development.
8. Increase research and development to create additional follow-up products as well as to further fine-tune our competitive advantages.

 

 

Global Business Plan Project

Module Eight – Creating a Global Management Information System

Learning Goals

1. To identify information needs for global business operations
2. To recommend features for an international management information system

Purpose

Computers and other technology have intensified the importance of information in all organizations.  Raw data converted to useful information makes managerial decision-making easier in the areas of financial planning, marketing, inventory, and human resources.  In this module, your goal is to identify and organize the information needs of a global business operation.

Resources

Web links:

• Global Edge CyberSite: http://globaledge.msu.edu/
• Business Around the World Atlas: https://highered.mcgraw-hill.com/sites/0078137217/student_view0/business_around_the_world.html

Conduct Research

Based on the global business opportunity identified in Module 1 (or a different international business enterprise or idea), research information related to the following:

1. GLOBAL INFORMATION NEEDS

Identify the types of reports and other data that would provide managers with the information necessary for organizational decision-making.  (Common categories of management information include financial documents, inventory data, sales and marketing reports, and human resource records.)

2. GLOBAL INFORMATION SOURCES

List the main:

1. external and
2. internal sources of data for your global business enterprise.

(External sources include government agencies, financial institutions, trade associations, suppliers, and customers.  Internal sources include research information, accounting data, employee records, sales figures, and inventory reports.)

 

 

 

3. TECHNOLOGY FOR MANAGING INFORMATION

Describe computer systems and other technology that would facilitate the processing, reporting, and use of information for international business operations.  (For example, a global computer network may be used to record and report inventory and sales from various branch offices.)

Supplementary Activity

Develop a suggested format for a web site (with information and interactive features) that would communicate to customers, suppliers, investors, and prospective employees some of the benefits and opportunities of your global business enterprise.

E-Commerce Application

Identify examples of two types of websites:

1. Those adapted for viewing in other countries, and
2. Those that originate in other countries.

Analyze and compare these types of sites to better understand web design and information systems in other countries.

Prepare Summary

In a separate Word document, prepare a summary report consisting of the following components:

1. An overview of information needs for the proposed global business enterprise.
2. A description of information sources and technology that would be used in a global information system for the situation.
3. A visual synopsis of a proposed global management system that identifies:
   1. input sources,
   2. processing activities, and
   3. output reports that would serve the decision-making needs of managers within the organization.

View Sample Report

The following project segments are EXAMPLES and SAMPLE MATERIALS.  Please note:

19. These samples were selected from several student team projects at one school and are not intended to represent a level of quality, and DO NOT represent a complete project.
20. The accuracy of content, data, and clarity of writing are NOT guaranteed; and
21. These samples may NOT BE DUPLICATED.

Technology will be a vital factor in the development of our harbor.  Everything from improved transportation to cheaper products will enhance the profits of our harbors because of the lower outside influences on countries to trade within our harbor, thus creating a larger market of opportunity.

Positive Aspects of the B2B E-Commerce Approach

The media hype associated with the Internet has served to raise awareness of e-procurement among all levels of industry.  This increased awareness brings with it a growing list of expected changes.  InfoAmericas surveys reveal that the following trends have already begun to change Latin America’s convoluted distribution channels.

1. Expanded Supplier Base

Selection and choice have grown tremendously thanks to freer trade in the Americas.  B2B e-commerce will accelerate this process, especially in trade-friendly Mexico and in non-physical products such as information and services.

2. Shrinking Distribution Chain

Latin America’s inefficient communication, financing, and distribution systems helped build a multi-layered distribution chain filled with privileged wholesalers who add little value to their customers or their suppliers.  Their days are numbered as manufacturers and distributors come together through e-commerce.

3. Lower Prices

Open trade helps lower the cost of inputs for many assemblers, and the cost of finished goods for many distributors, by inciting greater competition.  More efficient distribution could knock out one or two layers of middlemen, dropping prices by up to 40 percent.

4. Faster Product Delivery

Buen Salud is already in the beginning stages of developing a sophisticated integrated e-procurement system that keeps our manufacturing and distributing facilities in touch with the stores that sell our product in order to make inventory assessments more rapid and more accurate.  This level of information enables all suppliers in a chain to react to changes in demand.  Achieving such integration in other industries, let alone in Latin America, will take many years to achieve.  But large food retailers in Latin America have already begun to connect their suppliers to their inventory levels on-line, helping to reduce delivery times and inventory costs.

Negative Aspects to the B2B Approach in Latin America

1. Product Returns

About 25 percent of on-line product orders in Latin America involve a serious data entry error that can jeopardize the order, be it a wrong address, or an incorrect product selection.  Much of this is due to the heavy traffic on US sites in English by purchasing managers whose first language is Spanish or Portuguese.  If a buyer incorrectly purchases the wrong product, whose fault is it?  Who pays the shipping and handling?  How does the product cross the border again?

2. Clearing Customs

Traditionally, importers bore the responsibility of preparing the documents needed to clear customs and the American supplier just shipped the good to the nearest US border crossing.  With exporters now turned onto Latin America en masse, the burden has shifted.  Exporters must now take on the burden of border crossing or employ the talents of an experienced and expensive logistics company to take care of this function.

3. Payment

Brazilian banks lead the way in the development of e-commerce payment tools, but many foreign suppliers are unfamiliar with them.  Established supplier-buyer relationships can rely on direct billing, but first time or infrequent customers may not be able to negotiate such terms.  On-line credit checks of Latin American buyers are still a theory, not a practice.  So, buyers must resort to credit cards, or more likely wire transfers, which can take up to four days to complete.  Credit card security is always an issue, although most Latin American managers would rather give their credit card number to a US website than the restaurant where they eat lunch.

 

 

Global Business Plan Project

Module Nine – Identifying Human Resources for Global Business Activities

Learning Goals

1. To assess human resource needs for international operations
2. To identify appropriate global recruitment, selection, training, and retention activities

Purpose

In every organization, people are the resource that makes things happen.  Without employees and managers an enterprise is nothing more than raw materials, supplies, unfinished goods, and unsold inventory.  In this module, your goal is to gather information related to staffing, training, and managing workers for international business operations.

Resources

Web links:

• Global Edge CyberSite: http://globaledge.msu.edu/
• Business Around the World Atlas: https://highered.mcgraw-hill.com/sites/0078137217/student_view0/business_around_the_world.html

Conduct Research

Based on the country (or countries) you are analyzing for your global business enterprise, research information related to the following areas:

1. STAFFING

Identify needed skills of employees and managers.  Compare the use of ethnocentric, polycentric, and geocentric approaches to staffing.  (Most organizations need employees skilled in clerical work, marketing and sales, and financial planning.  Also identify needed technical skills for production, research, and maintenance.)

2. TRAINING AND DEVELOPMENT

List needed topics and instructional methods for ongoing training and management development related to technical skills, interpersonal skills, language, and cultural awareness.

3. PERFORMANCE APPRAISAL

Suggest performance guidelines that would balance organizational goals and individual needs, and which would reflect the cultural and legal situation.

4. COMPENSATION

Determine suggested wages and salary levels for various job positions based on company and country factors.  Propose an employee benefits package based on economic and cultural factors.

 

Supplementary Activity

Develop a video or in-class presentation that communicates differences in behaviors for various aspects of human resource management.  Present examples from different cultures contrasting the hiring process, training activities, performance appraisals, and compensation methods.

E-Commerce Application

Suggest employee competencies and training methods that would be appropriate when planning and implementing e-commerce activities in foreign markets.

Prepare Summary

In a separate Word document, prepare a summary report consisting of the following components:

1. An overview of employment positions, including required skills, which would be necessary for the proposed global enterprise.
2. A description of training topics and methods for this international business situation.
3. A synopsis of performance appraisal and compensation guidelines that reflect the economic, cultural, and legal environment of the country (or countries) in which business operations will occur.

View Sample Report

The following project segments are EXAMPLES and SAMPLE MATERIALS.  Please note:

22. These samples were selected from several student team projects at one school and are not intended to represent a level of quality, and DO NOT represent a complete project.
23. The accuracy of content, data, and clarity of writing are NOT guaranteed; and
24. These samples may NOT BE DUPLICATED.

The Happy Harbor Company plans to employ a management staff that will have the ability to take over the harbor once our staff has left.  The Happy Harbor Company will bring in a management staff from American harbors to train qualified harbormasters from other Peruvian harbors.  The employees under the management staff will be Peruvian citizens that will endure an intense one-year training period teaching them the logistic of a quality harbor.

Nearly 30,000 direct and indirect jobs are expected to be generated by the activity at our harbors.  Of these employees, 10,000 jobs will be directly generated by Port activity.  As the result of the local purchases by these individuals, 5,000 induced jobs will be supported in our harbor area.  Finally, as the result of the purchases by the firms directly dependent upon our harbor, 15,000 indirect jobs will be created.

Technical skills that the staff must have in order to work for the Happy Harbor Company are 1-5 years of harbor experience, depending on the level of employment they are seeking.  The harbormasters who apply must be knowledgeable of shipping patterns, able to set complex shipping schedules, and must have knowledge of at least three languages.

MANAGERIAL TEAM

Ms. E. serves as the Chief Executive Officer of El Coche Libro.  With a 100% commitment to building the company from the ground up, she took on the role of team leader.  As team leader, she has led the company by delegating roles to the most appropriate team member as she has evaluated the team roles and has adjusted them accordingly.  Her background includes a BA from Lake Forest College and her plans consist of attending Harvard for graduate school to obtain her Master of Business Administration.  Her goal is to be the proprietor of a photographic art gallery in New York.

Mr. M holds the position of Chief Financial Officer.  With his analytically based background, he controlled the money matters while consulting with key business leaders of Ford, Apple, and Amazon.com.  He took the initiative to forecast our financial plan and took a key role in developing our e-commerce department.  His background includes a BA from Lake Forest College and he plans to attend Yale for graduate school.  His goal is to utilize his political background and obtain the role of President of the United States.

Mr. B serves as El Coche Libros’ Chief Operations Officer.  With his IT background and Latin American upbringing, he served an important role in ensuring the operations of company in Latin America were running smoothly.  His plans consist of attending graduate school at Dartmouth.  His goal is to lead a consulting firm.

HUMAN RESOURCES

We believe that success is heavily contingent upon the performance of our employees.  To gain the best of the best we have put together a very enticing benefit plan for the SUBWAY employee.  Our benefits will include health insurance, dental, vacation time, 401k, help with student loans, and a $100 signing bonus.  The founding team and store management staff will do the hiring and firing.  There is not a benefit package or employment opportunity comparable to this in this industry.

THE MANAGERIAL APPROACH

The approach that most suits our business’s needs is as follows: We will insist that our managers will be young, energetic, and POSITIVE!  Our business opportunity relies immensely upon the availability of our employees to consistently offer a high level of customer service.  The founding management team has identified the fact that if this is to happen it must come from top to down.  For our employees to be successful, they must be happy with their jobs.  The management team has taken it upon itself to ensure a quality work environment that is professional, clean, safe, and fun.  The SUBWAY work environment will be very team-oriented to reduce the high level of turnover at the entry level.  We believe this management approach will help us keep our employees, which will in turn lead to a more efficient business.

 

 

Global Business Plan Project

Module Ten – Managing International Financial and Business Risks

Learning Goals

1. To identify potential risks in global business settings
2. To assess alternative global risk management strategies

Purpose

High inflation and import restrictions are just two of the many risks that a company may encounter when doing business in another country.  In this module, your goal is to obtain information related to managing various elements of global business uncertainty.

Resources

Web links:

• Global Edge CyberSite: http://globaledge.msu.edu/
• Business Around the World Atlas: https://highered.mcgraw-hill.com/sites/0078137217/student_view0/business_around_the_world.html

Conduct Research

Based on the country (or countries) you are analyzing for your global business enterprise, research information related to the following areas:

1. ECONOMIC AND FINANCIAL RISKS

Identify key areas of uncertainty related to level of economic development, infrastructure, and changing economic conditions in the country being considered for business operations.  (A weak infrastructure or volatile currency increases the risk of doing business in a foreign market.)

2. SOCIAL AND CULTURAL RISKS

Discuss customs, traditions, and social values in your proposed location that could create risks for the enterprise.  (Religious beliefs or the role of family can affect uncertainty when starting and implementing an international business operation.)

3. POLITICAL AND LEGAL RISKS

Analyze the uncertainty that might be created by political stability, corruption potential, and business regulations.  (Required labeling, tariffs, or ownership restrictions may be encountered in various nations.)

4. RISK MANAGEMENT TECHNIQUES

Compare various risk reduction strategies available when doing business in other countries.  (Common risk management methods include insurance, diversification of product line, strategic alliances with local partners, and employing local managers.)

Supplementary Activity

Interview a person who has worked with business enterprises in other countries.  Obtain information related to identifying and managing global business risks.

E-Commerce Application

Locate web sites with information related to economic and political risks when doing business in other countries.  What actions are commonly recommended to minimize or eliminate these risks?

Prepare Summary

In a separate Word document, prepare a summary report consisting of the following components:

1. A description of economic, social, and political-legal risks that might be encountered with the proposed global business enterprise.
2. Recommend risk management techniques that might be taken for these international business operations. Provide evidence to support your recommendations.

View Sample Report

The following project segments are EXAMPLES and SAMPLE MATERIALS.  Please note:

25. These samples were selected from several student team projects at one school and are not intended to represent a level of quality, and DO NOT represent a complete project.
26. The accuracy of content, data, and clarity of writing are NOT guaranteed; and
27. These samples may NOT BE DUPLICATED.

The top business risks that Buen Salud faces as it begins to enter the vitamin market in Latin America are:

1. The possibility of government instability or an unfriendly change of power in which Buen Salud loses its governmental grant and must, therefore, discontinue research and development towards new products as well as cut back production rates of the standard multi-vitamin.
2. Buen Salud faces liabilities concerning the health of our consumers. Great lengths must be gone to in order to make sure that no allergies or other health conditions are negatively affected by our product.
3. The geography and physical infrastructure of Argentina, Chile, Brazil, and Latin America in general, may pose problems for the distribution of our products, especially to the rural areas.

The customs, traditions, and social values in the country can influence product decisions and hiring policies.

Recent elections have created uncertainty for the political environment as to future free-trade policies and other government regulations.

To reduce risk in this venture, negotiations must include clear expectations as to delivery dates, quality assurance, and payment methods.

Global Business Plan Project

Module Eleven – Product and Target Market Planning

Learning Goals

1. To identify attributes and customer benefits for a proposed global product or service
2. To determine branding and targeting strategies for international markets

Purpose

A clear definition of an organization’s product (or service) along with a detailed description of potential customs provide the foundation of a marketing plan.  In this module, your goal is to obtain information related to the product offering and target market for your global business enterprise.

Resources

Web links:

• Global Edge CyberSite: http://globaledge.msu.edu/
• Business Around the World Atlas: https://highered.mcgraw-hill.com/sites/0078137217/student_view0/business_around_the_world.html

Conduct Research

Based on the global business opportunity identified in Module 1 (or a different international business enterprise or idea) and the country you have analyzed, research information related to the following areas:

1. PRODUCT CONCEPT

Identify the physical attributes, customer benefits, and competitive advantages of the product (or service) to be offered by the organization.  Analyze geographic, economic, cultural, and legal factors that would influence offering a standardized or an adapted product for this market.  (A product concept should list as many characteristics as possible to better communicate attributes and benefits within the organization as well as to potential customers.)

2. PRODUCT LIFE CYCLE

Discuss economic, cultural, political, or technological factors that might affect the speed of movement of the product (or service) through the stages of the product life cycle (introduction, growth, maturity, decline).  (For example, the presence of several competitors may result in faster innovation and move a product quickly through the product life cycle.)

3. BRANDING AND PACKAGING

Suggest a brand name that would create a distinctive identity for the company (or specific product).  Analyze cultural and legal factors that could influence packaging of the product.

4. TARGET MARKET

Describe the characteristics of potential customers in terms of geographic location, demographics, media habits, consumer behavior patterns, lifestyle activities, and psychographics.

Supplementary Activity

Prepare a product concept board.  This visual presentation should include information on the product attributes, customer benefits, competitive advantages, branding, packaging, and target market.

E-Commerce Application

Identify the following:

1. A brand only used online
2. A brand not used online
3. A brand available both online and in traditional business settings

Compare and contrast these brands regarding product strategy, visual and audio appeal, and other factors.

Prepare Summary

In a separate Word document, prepare a summary report consisting of the following components:

1. A description of the product concept for the proposed global enterprise, including attributes, customer benefits, and competitive advantages.
2. An overview of branding and packaging activities in relation to needed cultural or legal adaptations.
3. Recommend actions related to a standardized or adapted product (or service) along with detailed descriptions of consumer and business target markets. Provide evidence for your recommendations.

View Sample Report

The following project segments are EXAMPLES and SAMPLE MATERIALS.  Please note:

28. These samples were selected from several student team projects at one school and are not intended to represent a level of quality, and DO NOT represent a complete project.
29. The accuracy of content, data, and clarity of writing are NOT guaranteed; and
30. These samples may NOT BE DUPLICATED.

Our product concept is quite simple: we will be a traveling library.  We will have on-site educators that will donate their time to teach the youths how to read, and then to promote literacy through advanced stages of reading.  We will seek support from local government officials and athletic stars, which we believe will make people want to educate themselves further.  We will bring books to a designated area every week, distribute them, and return shortly thereafter to collect books and redistribute others.  All will benefit from this because it will increase the sense of community, the literacy rate, the economy of a community, and the overall general attitude children will have towards each other.

As we market our products in Brazil, we strive to promote a positive brand image.  SUBWAY has always been known for fresh and custom-made sandwiches, and we want to live up to the SUBWAY name.  Sensory characteristics include tasty sandwiches (made-to-order), filling (six inch or foot-long), and fresh (we bake our own bread and have shipments of fresh vegetables every day).  Perceptual characteristics include healthy (we have seven sandwiches under five grams of fat), affordable (we offer fresh value meal deals to fit everyone’s needs), and quick (fast food made before your eyes).

Society benefits from our franchise opportunity in several ways.  We will set up our store in a highly populated urban area where many business professionals and students work.  Therefore, they have a convenient place to stop for lunch or dinner when on the run.  We recognize the growing economic stability and the larger workforce that has been emerging in Brazil in recent years.  Franchising SUBWAY in Brazil will create jobs for society in both stores, and marketing/promotions.

The target market for our SUBWAY franchise is simple; it consists of anybody who wants to eat something that is healthy, affordable, and quick.  We believe that students, professionals, laborers, and families could all be factored into the target market.  Our first store will be built in Sao Paulo, which is highly populated with businesses and schools.

We also plan to provide catering services to small and medium-sized businesses in the surrounding metropolitan area.  By devising party packs for businesses, we can increase our sales by almost 50 percent, while satisfying our customers with efficiency and quality food.

Since it is our primary goal to enhance the living standards of people in Argentina, Brazil, and Chile (before reaching other areas of Latin America), we want to be able to help prevent health problems that exist in these regions.  As we have shown, the lack of prenatal care is common and cancer rates among middle-aged women are increasing in these areas and throughout Latin America.  With the use of the Buen Salud vitamins, we hope to decrease the number of cancer cases in Argentina, Brazil, Chile and, eventually, the entire region.  We feel that Buen Salud vitamins will aid in the deterrence of health problems for the general population, but more specifically towards our target market of women with families or women who will be expecting families.

The Buen Salud vitamin company has decided on a target market for the Latin American regions that will consist of not only the greater population, but also especially women with families or expectant mothers.  Our target market of women not only faces health risks that were mentioned above but are also the daily decision makers for family shopping.  These mothers will primarily be the ones in the grocery store analyzing and ultimately purchasing various products.  Although these pills can be taken whole when swallowed, children and adults who are unable to swallow pills will find that our vitamins are unlike other brands.  Our product has a competitive advantage over other brands because of the innovative ability for these pills to dissolve in water or other liquids making it easier to swallow and digest.

Although marketed towards women of households, these essential vitamins can and should be taken by everyone in the family.  As Argentina, Brazil, and Chile all represent such diverse areas, Buen Salud has set out in customizing vitamins for each of these regions.

Brazil and Chile are both regions of Latin America where poverty-stricken families are abundant, especially in rural areas.  Our company has realized this and has made efforts in producing one vitamin that can be taken by everyone in the household.  Since there will be more individuals taking the same vitamin we have decided on selling this nutritious pill in bulk (500 pills per bottle).  By doing this, we can sell more for less.  The easily digestible vitamin can be swallowed, chewed, or dissolved.  However, the standard vitamin must be cut in half for children under of the age of 13.  To make this process easier, we will make a small indentation down the middle of the pill.

As Argentina is the most developed country within this grouping, Buen Salud will offer an expanded product line to this region.  Due to their current wealth, Buen Salud feels that Argentineans will be able to afford our various customized pills.  In addition to the general essential vitamins used by everyone (250 pills per bottle), we will offer specific vitamins made for men, women, and children.  We will also be selling mental clarity, energy, and memory pills.

Whirlpool’s primary target market for its Costa Rican resort will be middle to upper class foreign tourists.  Whirlpool will first market their hotel to American tourists, then they will consider expanding to other industrialized countries such as Canada, Western Europe, and Japan.  Costa Rica will appeal to American tourists because Hawaii is the only tropical destination in the United States that comes close to comparison.  Costa Rica, however, has the allurement of an exotic foreign country where travelers can experience a different culture and language and meet new people.  Disposable income will also play a large role in determining this target market.  People can only travel and go on vacations if they have money left over to spend after paying for the necessities in life; that is why Whirlpool will target people in the middle to upper income brackets.

The second important market segment that Whirlpool should not overlook is business travelers.  Many corporations send individuals to Costa Rica for business, trade fairs, conferences, etc.  Companies tend to spare no expenses and put their employees up in luxury resorts with all the frills.  In addition, Whirlpool’s own hotel will have two conference rooms that they will want to fill to capacity each year.

 

 

Global Business Plan Project

Module Twelve – Designing a Global Distribution Strategy

Learning Goals

1. To determine factors that influence international distribution activities
2. To identify appropriate distribution strategies for proposed global operations

Purpose

The movement of goods and services between the producer and consumer is a vital element of global marketing activities.  Distance and documentation can make this movement expensive and time consuming.  In this module, your goal is to obtain information related to your proposed global distribution strategy.

Resources

Web links:

• Global Edge CyberSite: http://globaledge.msu.edu/
• Business Around the World Atlas: https://highered.mcgraw-hill.com/sites/0078137217/student_view0/business_around_the_world.html

Conduct Research

Based on the country (or countries) you are analyzing for your global business enterprise, research information related to the following areas:

1. INFRASTRUCTURE ANAYLSIS

Describe transportation, communication, and utility facilities in the country that might enhance or deter your organization’s ability to move goods from one destination to the end-user of the item.  (In many countries, a lack of roads combined with mountainous areas make truck shipping very difficult and expensive.)

2. DISTRIBUTION BARRIERS

Discuss cultural, political, or legal hurdles that might slow or block distribution in the country.  (For example, import duties and documentation might add to the cost of selling products shipped from another country.)

3. INTERNATIONAL INTERMEDIARIES

Analyze the costs and benefits associated with using wholesalers, brokers, and agents for your global business operations.

4. DISTRIBUTION CHANNEL

Identify a channel of distribution for getting a product from the production site to the ultimate customer.  (A common channel of distribution may include a wholesaler and retailer; global operations are likely to involve additional intermediaries.)

Supplementary Activity

Interview a person involved with international logistics such as a freight forwarder or customs broker.  Obtain information regarding packing, shipping methods, export documents, tariffs, and other aspects of moving goods across borders.

E-Commerce Application

Propose a web site that could enhance the distribution capabilities of an organization.  Suggestions might include product information, retailer locations, customer service assistance, and online ordering.

Prepare Summary

In a separate Word document, prepare a summary report consisting of the following components:

1. An assessment of the infrastructure in the country (or countries) being considered for the proposed global enterprise.
2. A synopsis of trade barriers or other restrictions that might be encountered.
3. Recommend a distribution channel and intermediaries that could be appropriate for the proposed international enterprise. Provide evidence to support your proposal.

View Sample Report

The following project segments are EXAMPLES and SAMPLE MATERIALS.  Please note:

31. These samples were selected from several student team projects at one school and are not intended to represent a level of quality, and DO NOT represent a complete project.
32. The accuracy of content, data, and clarity of writing are NOT guaranteed; and
33. These samples may NOT BE DUPLICATED.

Distribution of the Happy Harbor products from government to government will be through the quality of the shipments conducted with sea vessels.  Once in the harbors, to disperse the products through channels, the Happy Harbor Company plans to use the Latin American based All-Cargo Express which will provide air-freight, shipping, rail freight, trucking, and other specialized transportation that is deemed necessary.

Our distribution strategy will not be standardized because we will not be following the usual path of producer to retailer to consumer.  Our distribution chain will entail producer to Healing Wheels to consumer.  Since rural Bolivians lack means of mobility, we plan on bringing the products to them.

Buen Salud’s marketing strategy incorporates plans to sell our product through several channels:

1. The same salespeople who promote our product to the rural area will also carry with them a relatively large supply which they can sell on site to individuals or to small stores.
2. Orders will be taken over the phone (the equivalent of a 1-800 number) and the traveling salespeople will distribute those orders in rural areas, or they will be sent through the mail system.
3. Semi-trucks will carry large inventories of our product to larger retail stores, usually supermarkets, of the countries in which we are operating.
4. Our projected mix of distribution channels will give us the advantage of penetrating more local markets than most of our competitors.

 

 

Global Business Plan Project

Module Thirteen – Planning a Global Promotion Strategy

Learning Goals

1. To identify promotional goals for global business activities
2. To recommend promotional strategies for international operations

Purpose

International communications create some of the most interesting and difficult aspects of global business activities.  In this module, your goal is to plan various elements of an international promotional plan.

Resources

Web links:

• Global Edge CyberSite: http://globaledge.msu.edu/
• Business Around the World Atlas: https://highered.mcgraw-hill.com/sites/0078137217/student_view0/business_around_the_world.html

Conduct Research

Based on the country (or countries) you are analyzing for your global business enterprise, research information related to the following areas:

1. PROMOTIONAL GOALS

Identify specific objectives related to the promotion of your global business operations and product (or service).  (Promotional goals vary.  Some organizations need to create awareness of their product’s benefits compared to competitors.  Other promotional goals may involve communicating new uses for an item or informing customers of lower prices.)

2. BUSINESS ENVIRONMENT

Discuss cultural and legal factors that might influence promotional decisions.  (In some countries, certain information is required in television commercials selling products aimed at children.)

3. MEDIA PLAN

Analyze media availability in the country to determine cost-efficient methods of communicating with potential customers.  (While television, radio, newspapers, magazines, and the Internet may be common in industrialized countries, developing economies may require other different media.  In some countries, advertising messages are broadcast through large speakers mounted on moving trucks.)

4. PROMOTIONAL STRATEGY

Compare the benefits of push and pull promotions for your global business operations.  (A pull strategy is aimed at the end-user of consumer goods and services.  A push strategy is aimed at intermediaries, such as retailers, and is more common among firms selling industrial products or services.)

Supplementary Activity

Design a storyboard, video commercial, or print advertisement for a product or service intended to be sold in a foreign market.  This presentation should reflect economic, cultural, and legal influences of the country’s business environment.

E-Commerce Application

Conduct an online analysis of advertising used on various web sites.  Analyze how these promotions are used to attract viewers to the site, to generate advertising revenue, to motivate online buying, or for other promotional goals.

Prepare Summary

In a separate Word document, prepare a summary report consisting of the following components:

1. An overview of promotional goals for the proposed global business venture.
2. A description of the economic, cultural, and political-legal environment that might affect promotional messages and media.
3. Recommend a promotional strategy for your planned global enterprise. Suggest company actions related to promotional goals, needed adaptations due to cultural or legal factors, and a media plan.  Provide evidence to support your proposal.

View Sample Report

The following project segments are EXAMPLES and SAMPLE MATERIALS.  Please note:

34. These samples were selected from several student team projects at one school and are not intended to represent a level of quality, and DO NOT represent a complete project.
35. The accuracy of content, data, and clarity of writing are NOT guaranteed; and
36. These samples may NOT BE DUPLICATED.

The marketing plan will access corporate marketing programs.  This will provide materials such as signs, displays, and promotions.  We have planned to utilize this as much as possible because there is not financial outlay.  We have realized, however, that it would be to our advantage to have our own marketing plan that would consider the cultural differences that corporate SUBWAY may have missed.

Our advertising plan will consist of radio ads, newspaper ads, Internet ads, coupon flyers, and signs in heavily populated areas.  We have constructed a strategic alliance with a sign company that has resulted in great deals for advertisements.  We feel very confident in the fact that we will have a very sound advertisement plan.  Our manager will play a major role in our advertising so that we can tailor our ads to the culture of Brazil.  We are also prepared to contract out to advertisement agencies for help in our advertising department.

To better market our exciting business we have chosen a promotional plan offering the SUBWAY sandwich stamps used around the world.  We will, however, add giveaways and promotional deals from time to time to attract new business and to show our appreciation of existing customers.  We have thought of having promotions that take advantage of customs or culture.  An example would be having all vegetarian and fish subs half price on Friday.  This would show our customer that we are interested in making them happy because we are supporting their Catholic beliefs as well as helping them save money.

Finally, our marketing plan will rely heavily upon the Internet.  We plan on having ads on high traffic sites.  Our web page will also play a major role because we are planning to offer discounted prices for online ordering.  We believe that the Internet will be able to help us make our business much more efficient.  We want to be seen as a fresh, healthy, and fun establishment, and we plan to market ourselves in this way.

Promotion and advertising now play the role of communicator between the company and the consumers (D’Andrea and Quelch 141).  For Whirlpool’s new hotel to be successful, extensive advertising will be a crucial part of the marketing plan.  Whirlpool’s revenues will come from the foreign tourists it attracts to its Costa Rican hotel—no tourists, no revenue.  Whirlpool’s basic advertising objectives are to inform potential customers about the new resort and to persuade them to give Whirlpool their business.  Jellyfish Consulting recommends that Whirlpool Corporation contract Marriott to handle advertising and promotional efforts, in addition to managing the hotel.  Marriott has an advertising agency in New York, Lintas and Partners, which handles all work targeting the leisure market.  Ultimately, Whirlpool would like to participate in a joint effort where representatives from both Whirlpool and Marriott coordinate the advertising campaign together.  Before Whirlpool can begin advertising, however, they need to identify their target markets.

The ad campaign will strive to communicate to potential customers the comforts of this luxury hotel and the beauty of the tropical landscape and wildlife in Costa Rica.  Whirlpool wants its advertisements to convey the look and feel of a full-service resort in a tranquil paradise where an individual can relax, enjoy nature, and experience a new culture.

Jellyfish Consulting suggests that Whirlpool arrange in the management contract the right to use “Marriott” in the hotel’s name.  Marriott is a strong and recognizable name throughout the world that people associate with high quality and comfort.  Customers will also then be able to link to Whirlpool’s hotel from the Marriott homepage to learn more information and make reservations.  Jellyfish Consulting also recommends that the hotel name include words that trigger the image of a tropical paradise and relaxing haven when a tourist hears or reads the name.  As of now, Marriott and Whirlpool have come to a tentative agreement for a hotel name: Marriott’s Tropical Retreat.

Jellyfish Consulting recommends that Whirlpool Corporation advertise the hotel in U.S. travel magazines, as well as contact and negotiate deals with travel agencies in large U.S. metropolitan areas to promote the new Costa Rican resort.  Some popular travel magazines that Whirlpool is currently looking into for advertising space include Travel and Leisure, Conde Nast Traveler, and Resorts and Great Hotels.

Jellyfish Consulting also recommends that Whirlpool Corporation create promotional packages and offer incentives to companies who send individuals to Costa Rica for business, trade fairs, conferences, etc. to stay at the Marriott’s Tropical Retreat.  The incentives could range from discounted room rates, to free dinner vouchers to eat in one of the two hotel restaurants.  Whirlpool is currently researching what U.S. multinational corporations are located in Costa Rica, because these companies would be sending business executives from the States to the country to engage in business.  Whirlpool hopes that they can capture this business by either offering these business travelers a place to stay or encouraging them to hold meetings in one of the hotel’s two conference rooms.

E-COMMERCE POTENTIAL

Currently, the infrastructure in Latin America is not yet strong enough to be supporting e-commerce activities.  “There were 8.7 million Internet users in the region in 1999, most of them in Brazil (41%), Mexico (21%), and Argentina (10%)” (Info World).  In Bolivia, only 18,000 people use the Internet on a regular basis.  That is less than 1% of the entire population (Info World).  It is expected that by the year 2003, there will be 29.6 million Internet users in Latin America (Jupiter Communications).  Latin America is seeing a trend in ISP carriers offering free Internet service.  El Coche Libro will benefit from this Internet expansion.  In 2000, we will be developing our web site so that by the year 2003, we will be ahead of other companies and our service will be steps ahead of our competition!

The Happy Harbor Company will promote the harbors and entertainment facilities through different communication channels.  The first form will be through the website that can be located at www.happyharborcompany.com.  On this website, the Happy Harbor Company will provide information on the services that the company will offer.  The website will in turn develop word of mouth and name recognition for the Happy Harbor Company.  Another form of promotional material that the Happy Harbor Company will provide are pamphlets sent to target governments emphasizing the services that the company offers.  Finally, the Happy Harbor Company will hire personnel to lobby to the governments for support of the harbors and entertainment sectors.

Get Therapeutic Homework Help Here!!

 

Global Business Plan Project

Module Fourteen – Selecting an International Pricing Strategy

Learning Goals

1. To assess influences on pricing activities for global business operations
2. To recommend a potential global business pricing strategy

Purpose

Prices are most influenced by production costs, potential demand, actions of competitors, and government regulations.  In this module, your goal is to obtain information related to various factors influencing international pricing activities.

Resources

Web links:

• Global Edge CyberSite: http://globaledge.msu.edu/
• Business Around the World Atlas: https://highered.mcgraw-hill.com/sites/0078137217/student_view0/business_around_the_world.html

Conduct Research

Based on the country (or countries) you are analyzing for your global business enterprise, research information related to the following areas:

1. THE ECONOMIC ENVIRONMENT

Identify economic factors (personal income level, inflation rate, taxes) that might influence pricing decisions in this country.  (In many countries, people may not be able to afford products that are considered minor purchases in industrialized nations.)

2. COST ANALYSIS

Estimate production costs and other business expenses that would be encountered when offering this product or service.  (The total cost of providing an item must include both direct production costs as well as administrative and overhead expenses.)

3. DEMAND ANALYSIS

Analyze the potential demand for this product (or service) based on the current and expected market.  (As a product gains in popularity or a country’s economy improves, demand for various items is likely to expand.)

4. COMPETITOR ANALYSIS

Compare your pricing plans with those of any competitors that may be providing identical or similar products or services.

 

Supplementary Activity

Conduct an interview with a person who has worked, lived, or conducted business in another country.  Obtain information about economic conditions, production costs, and other factors that influence pricing.

E-Commerce Application

Compare prices for similar (identical, if possible) products that are available both online and in traditional retail settings.  What differences exist?  What may account for these differences?  How do online pricing strategies differ from traditional settings?

Prepare Summary

In a separate Word document, prepare a summary report consisting of the following components:

1. An overview of economic factors that could influence pricing strategies.
2. A synopsis of costs that would influence the price of the good or service being proposed for global business operations.
3. A description of demand factors, competitor actions, and government regulations that might affect pricing activities.
4. Recommend a pricing strategy (including specific prices) for the proposed enterprise. Provide evidence to support your proposal.

View Sample Report

The following project segments are EXAMPLES and SAMPLE MATERIALS.  Please note:

37. These samples were selected from several student team projects at one school and are not intended to represent a level of quality, and DO NOT represent a complete project.
38. The accuracy of content, data, and clarity of writing are NOT guaranteed; and
39. These samples may NOT BE DUPLICATED.

Buen Salud makes every possible effort to keep our prices competitive.  Prices will, though, be significantly higher in urban areas, such as Buenos Aires, where people tend to make higher salaries and can, therefore, afford to pay the higher price.  The excess money made in these urban areas will help fund our continued presence in the more underprivileged areas of Latin America.  The price of one bottle of multi-vitamins in these poorer areas will be approximately $5 (US) for a bottle of 500 vitamins.  This amount of vitamins will supply a family of five (adults) for 100 days (the supply within families with children will last even longer since children only take half a pill a day).  This means the family will only have to buy, at the most, four bottles a year, adding up to $20/year.  This should not interfere with the “bread-basket costs” of most of our consumers.  Furthermore, if our consumers do not have the money up-front, we will have a payment plan whereby they can pay for their vitamins in monthly installments.  The prices for our products have been developed by researching vitamin prices in the US (through the Osco drug company).

International marketing costs will include the price of translating services to market our product across the globe.  The increasing demand for exporting across the globe will increase the popularity of our services worldwide.  To make our harbor services worthy of a government’s purchase, we must offer competitive prices and an increased technology compared to the other harbors currently located in Peru and throughout the world.

Whirlpool will determine its prices first and foremost by competition with other luxury resorts.  They will strive to make customers feel that US $200 a night is well worth the price.  Whirlpool is dedicated to providing tourists with an ultimate vacation experience that they will never forget.

 

 

Global Business Plan Project

Module Fifteen – Determining Organizational Financial Results

Learning Goals

1. To project inflows and outflows resulting from expected revenue sources and expenses
2. To identify potential measurements of financial success

Purpose

Profit margin, return on investment, and market share are some of the common financial measurements used to assess business success.  In this module, your goal is to estimate potential financial results.

Resources

Web links:

• Global Edge CyberSite: http://globaledge.msu.edu/
• Business Around the World Atlas: https://highered.mcgraw-hill.com/sites/0078137217/student_view0/business_around_the_world.html

Conduct Research

Based on the country (or countries) you are analyzing for your global business enterprise, research information related to the following areas:

1. REVENUE SOURCES

Identify and estimate amounts for product (or service) sales for various market segments.  (For example, some companies sell both to consumers and businesses.  A heating company may sell furnaces to homeowners as well as to companies.)

2. OPERATING COSTS

List and estimate operating expenses necessary for producing (or obtaining), storing, marketing, and distributing the product (or service) for this business enterprise.

3. START-UP COSTS

Review your start-up cost estimate from Module 7.  Suggest any revisions based on additional information or expanded knowledge of planned business operation.

4. PROFITABILITY

Describe an expected profit level for this global business venture based on economic conditions, competition, the size of the operation, and the market environment of the country.  (Most new business activities take two, three, or more years before becoming profitable.  Many ventures never earn a profit and either cease operations or a revised plan is implemented.)

 

 

Supplementary Activity

Conduct a financial analysis of a global company using the organization’s most recent annual report and data from the Web.  Compare revenue amounts and profit for domestic and international operations.  Discuss company plans and potential financial gains from international business activities.

E-Commerce Application

Assess the potential of online selling regarding expanded revenue sources and reduced operating costs.

Prepare Summary

In a separate Word document, prepare a summary report consisting of the following components:

1. A description of revenue sources and estimated amounts for the proposed global enterprise.
2. A synopsis of estimated operating expenses and start-up costs.
3. An analysis of expected profitability over the next few years. Provide evidence to support your analysis.

View Sample Report

The following project segments are EXAMPLES and SAMPLE MATERIALS.  Please note:

40. These samples were selected from several student team projects at one school and are not intended to represent a level of quality, and DO NOT represent a complete project.
41. The accuracy of content, data, and clarity of writing are NOT guaranteed; and
42. These samples may NOT BE DUPLICATED.

Port revenue will be derived from property rental to commercial and industrial enterprises, and from maritime operations that include container and break-bulk cargo, ship repair, sport and commercial fishing, cruise operations, harbor services, and other maritime services such as ferries and excursions.  We are planning to have 650 port tenants, and approximately 176 subtenants, and more than 50 maritime services companies such as freight forwarders and steamship agents.  To use the harbors, the Happy Harbor Company has estimated the price for port tenants at $2,000/day.  While this is a costly sum, the profits that the harbor will produce for the countries in the long run is well worth the costs, since exporting/importing of products will produce millions of dollars for the economy of our governmental clients.  State and local governments will receive an estimated $120.8 million of tax revenue from Port activity.  The revenue includes sales tax, employment tax, income taxes paid by employees, business taxes, property taxes, and transportation taxes.  Of the $120.8 million, $19.1 million in tax revenue will go directly to Chiclayo.

A total of $1.7 billion in revenue is estimated for our port activity.  The revenue includes the value of goods and services sold by Port tenants, the revenue earned by businesses directly dependent on Port cargo, cruise, ship repair, fishing operations, and revenue generated by the construction activity and other miscellaneous activities occurring on Port property.

Port tenants and businesses will hopefully produce $729 million of local purchases, dependent on Port cargo cruise ship repair, and fishing operations.  For our company to break even within five years, our company will have to produce $1.6 million a day in profits.  Expenses that the company will incur are electricity, maintenance of the harbor, salaries, and other operational costs that go along with operating a harbor and entertainment port.

REVENUE SOURCE ESTIMATES

• shopgenerosity.com– in excess of $35,000 a year
• Donations—in excess of $25,000 a year
• Governments and sponsors—in excess of $50,000 a year

CASH INFLOWS

The cash inflows for year one include the revenue from sales.  Our company’s goal is to sell our product to at least one-tenth of the population the first year.  While the average Latin American family has 5 members, each bottle of vitamins has five hundred capsules, at $5 per bottle, and approximately 4 bottles per family each year, we estimate a first-year cash inflow of approximately $2 million, with a substantial expected increase annually.

However, this branches off into both business-to-business and business-to-consumer business for our company.  While B2B would be selling to such places as grocery and convenience stores, their annual sales would closely rival our B2C sales, which we hope will do quite well due to our traveling salespeople, introducing our products in rural areas.

These sales figures are estimated.  While our company will also receive a grant from the Argentinean government of $1 million annually for the research and development of vitamins and other health care products to be both manufactured in Argentina.  Later as we grow, we will expand our business abroad to other countries.

CASH OUTFLOWS

Our cash outflows include production materials and other supplies that will change annually due to variation in sales.  An estimated $50,000 will be used as our advertising budget for the introduction of our fine vitamins into the marketplace.  The employee salaries become divided up into three major categories.  They include:

1. Managerial Team

The combined total amount of wages for the 5 team members will be $250,000 annually.

2. Traveling Salespeople

Since these team members will frequently be on the road, they will have accrued other expenses, as well as their wages.  These expenses include transportation, lodging, and dining costs.  We have figured that the total costs for our 20 traveling team members will amount to be around $640,000.

3. Our other cash outflows include paying the people who make our product. The combined wages for our 35 factory workers will be around $210,000.

Other outflows that have not been discussed include:

1. Maintenance Costs

This will include the repairing of our distribution vehicles and the equipment in our factory.

2. Legal Fees and Insurance

These include the costs for our lawyer who will analyze the legalities of our operations.  The insurance costs will be used for covering Buen Salud if anything happens to one of our employees or our facilities or our vehicles.  To cover these costs, we estimate them to be $10,000.

 

 

Global Business Plan Project

Module Sixteen – Measuring International Business Success

Learning Goals

1. To assess potential financial success of the proposed global business activity
2. To identify potential social contributions of the proposed global business activity

Purpose

While every business enterprise is primarily concerned with financial success, economic and social influences on the host country should also be considered.  In this module, your goal is to determine potential dimensions for measuring global business success.

Resources

Web links:

• Global Edge CyberSite: http://globaledge.msu.edu/
• Business Around the World Atlas: https://highered.mcgraw-hill.com/sites/0078137217/student_view0/business_around_the_world.html

Conduct Research

Based on the country (or countries) you are analyzing for your global business enterprise, research information related to the following areas:

1. FINANCIAL GAINS

Identify potential profit levels and other measures of financial success for this global business operation.  (Commonly considered measurements of financial success include profits, return on investment, market share, sales growth.)

2. ECONOMIC BENEFITS

Discuss positive economic contributions that this business operation might have for the host country.  (Economic benefits may include improved infrastructure, creation of jobs, more efficient use of natural resources, or increased personal income.)

3. SOCIAL BENEFITS

Determine improvements to the country’s society that might result from the company’s global business activities.  (Positive social results might include improved employee training, expanded health care and other benefits for workers, or additional housing facilities.)

4. SOCIAL COSTS

Describe the potential drawbacks for the host country that might result from this business venture.  (Social costs of global business operations may include pollution, reduction in natural resources, or changes in traditions.)

 

Supplementary Activity

Create a video, in-class presentation, or website with a summary of all phases of your global business plan.

E-Commerce Application

Develop a website communicating various services that can contribute to economic development and improved quality of life through global business activities in a society.

Prepare Summary

In a separate Word document, prepare a summary report consisting of the following components:

1. An overview of potential financial gains from the proposed global enterprise.
2. A description of possible economic benefits for the countries involved.
3. A synopsis of social benefits and possible costs associated with the proposed business venture.

View Sample Report

The following project segments are EXAMPLES and SAMPLE MATERIALS.  Please note:

43. These samples were selected from several student team projects at one school and are not intended to represent a particular level of quality, and DO NOT represent a complete project.
44. The accuracy of content, data, and clarity of writing are NOT guaranteed; and
45. These samples may NOT BE DUPLICATED.

Overall, the Buen Salud Company can be characterized as a small, independently-owned manufacturer and distributor of a reasonably priced multi-vitamin the whole family can take.  Buen Salud strives to meet the needs of its consumers by providing not only the essential vitamins and individual needs to maintain health and prevent illness, but by also educating them on health issues through our company’s literature and, eventually, through an interactive website.

The vision of Healing Wheels is to be an organization that leads in the delivery of high-quality preventative health care services and products.  Healing Wheels is a non-profit organization with headquarters in the city of Santa Cruz, with regional offices in La Paz, El Alto, Tarija, Riberalta, Puerto Quijarro, Yacuiba, Cochabamba, and Oruro.  Designed to be compatible with the goals and policies of the national health system, Healing Wheels will evolve into a network of high-quality sustainable health services with active participation of the communities being served.

Rates of return will need to exceed cost of capital based on current interest rates and risk premiums.

Social contributions that can result from this enterprise include increased employment, political stability, and improved infrastructure for the country.