Blair Entered India Market

Blair Entered India Market

Political legal:

• Chaterrjie confirmed that India is attractive to foreign investment through liberalization

• Foreign companies were taxed on income arising from Indian operations and pay taxes on any interest, dividends and royalties received

• The government offer favourable tax treatment if foreign investors will locate on one of the free zones

• Tax rate is higher than the USA, however the return on investment is higher than USA

• Trademarks and patents were protected in India

• Legislation in India was expensive and protracted that foreign firms prefer arbitration

Our suggested improvements and comments:

He should have analyzed the following:

• Monopolies legislation: to hedge against any monopolistic actions that may appear in the future

• Environmental protection law

• Employment law and this is important if the market entry will be joint venture or acquisition

Economic factors:

Chatterjee analysis completely missing the economic factors, as he didn't analyze the Indian economy in any way

He should have analyzed the following:

• Interest rates

• Inflation rate

• Business cycles

• Unemployment rates

• Disposable incomes

As these factors are important to give insights about the economic conditions and the economic growth for the next years so as to know whether the market is potential for entry or not

Sociocultural factors:

Chaterjee identified his target market to be around 40 million households and he identified their needs and behaviour, but he missed identifying the whole sociocultural factors from the following perspectives:

• Population demographics: population size, age distribution , religion ,social class are important factor to be analyzed by any firm before entering any market

• Income distribution

• Levels of education

• Social mobility

• Work and leisure time

These factors are important especially that the target market for him was the rich well-educated high social class so it's important to identify this class and its growth

Technological factors:

Chatterjee analysis emphasized that technology was only available in large Indian cities; the lack of adequate distribution and communication infrastructure in rural India meant that any market entry would begin with larger Indian cities most likely in the west coast.

But he should have analyzed many other aspects regarding this issue:

• Government spending on research

• Government and industry focus on technological efforts

• The speed of technology transfer

• New discoveries and development

• Rate of obsceneness

Step two:

Scanning the internal and external micro environment

In this step we will start by analyzing the internal and external microenvironment then finalize it by the swat analysis, which was missing in chatterjee's study. He ignored mainly the microenvironment regarding the suppliers, stakeholders and intermediary's .He only analyzed consumers and competitors.

2-1 internal-environment analysis:

Employees: Blair Company employed over 4000 people with 380 having technical backgrounds and responsibilities

Cash Flow: company sales revenue for 1996 would be almost $400 million with an expected profit close to $50 million

Annual Growth in sales revenue: averaged 12% for the past 5 years

Capital assets: ignored by Chatterjee

Sales in the international division: would reach almost