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Posted By Admin @ Feb 28, 2022
Posted By Admin @ Feb 28, 2022
Tittle: Report on the Almarai Expansion to India
Almarai Expansion to India
Introduction of Almarai Expansion to India
There are few industries, which can never be out of business, and the food & beverage industry is one of them. There can be changing trends for this industry, but its presence will always be there because food is an essential part of daily life, and beverages are also important for the modern lifestyle. Moreover, different industries are gaining good opportunities to expand their business on a global scale with the essence of globalization. It is a fact that the expansion of business from one country to another country is not an easy thing, but it can come up with great opportunities that risk is worth taking. That’s why many food & beverage companies have become international brands because they expanded their business across the globe. This expansion can provide great international brand recognition to companies, and they can become global brands covering more markets (Wilkinson, 2004). In this paper, a brief plan of expansion for Almarai Company will be presented, where Almarai will be considered to expand to India, as India is one of the largest consumer markets in the world.
A Brief Description of Almarai Expansion to India
There are many biggest companies in Saudi Arabia, and Almarai is one of them. It is the biggest dairy firms in the country in terms of its food processing and market value. The foundation of the company was laid in 1977, and it has never looked back ever since. In the era of the 1990s, the company boosted its business in so many ways to be restructuring its various business aspects so that it can become a successful company in the Kingdom of Saudi Arabia. Currently, the company is working in different markets such as poultry, bakery, as well as dairy markets (Almarai.com, 2019). The company started to get bold fashioned in the 21st Century so that they can cover more parts of Saudi Arabia, and expand to other regions of the world. In 2009, it was announced by the company that they will expand their business to Africa and South East Asia (Arabian Business, n.d). Looking at these facts and plans from the company, it can be said that they should also consider expanding their business to the Asian market as well, and the Indian market can be a great opportunity for them in this regard. They can expand to the Indian market for one or two business units like they can expand their poultry and dairy products to India. It is assumed that they can get a considerable response from the Indian market.
Recommended Mode of Entry and Rationale of Almarai Expansion to India
Before giving any recommendations for a suitable mode of entry for Almarai in the Indian market, it is important to have a look at some of the considerable mode of entries. The first important mode of entry is Direct Exporting. In this entry mode, the products of a company are directly exported to the foreign market, and this mode is one of the fastest to reach the foreign markets. The other considerable mode of entry is making joint ventures with the firms in the target country as those firms already know different aspects of the business. A few other modes of entry are franchising, licensing, strategic alliance, as well as online sales in the market. Looking at these modes of entries, it is important for a company to select an entry mode, which is more suitable for their business type and structure. Each mode of entry has its own advantages and disadvantages, so a mode should be selected, which has required elements for a firm to expand (Wolfe, 2018)