Essay
Unit 39 D1
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Essay of 4 pages for the course Unit 39 - International Business at PEARSON (Unit 39 D1)
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IntroductionIn this task I am going to evaluate the potential problems faced by businesses that trade
internationally when entering new markets.
There are many problems that a business could face when trading internationally into a new
market that includes culture, religion, competition and Law.
McDonald’s have impressively transformed their empire from a few branches in the United
States to a global super brand, which is known by millions where they have stores in many
different markets. McDonald’s is known for great food, services and reasonable price.
McDonald’s branding system is phenomenal as it brings in a lot of customer due to their
branding power, it already bring in millions of customers, however there are problems faced
when entering new markets and I’ll be explaining before and illustrate how McDonald’s
overcome the problems faced.
Culture
Culture has its own uniqueness in every part of the country across the world. Culture comes
with different values and tradition and this has a huge impact of where people live in and it
must be respected. Businesses always want to go to different markets to establish their brand
and presence to increase their value and revenue, however there are some problems faced
when entering a new market and one example is culture. Culture is something which is highly
important to the people in different societies. Culture is not the same in range of different
countries, every country have their own unique culture with different sets of values, people,
tradition and food. Businesses will have to do their research and marketing skills to
understand the culture of a certain country and apply their business operation to that country.
There are more than 193 countries across the world, and each country has their own culture
or more than one. A business like McDonald’s cannot go blindly into a new market and
operate their products and services without doing their homework about the culture,
demographic, location, population and the people. The problem for McDonald’s can be a
massive backlash due to not doing the research of the country this can lead to a miserable
failure in setting up. Culture is a big factor which needs to be considered as people live for
the culture, and people are the biggest stakeholders or you could say assets to the business as
they’re using their money to purchase your products and services.
I’ll be explaining an example of how McDonald’s faced a problem and overcome it.
McDonald’s is known for their beef and chicken burgers, by the names of Big Mac and
Chicken o Fillet. This was a cultural/religion problem for McDonald’s when they’ve entered
the Indian market because Hinduism makes up 79.8% of the Indian population, while Islam,
Christianity and Sikhism makes up the rest of the population. In Hinduism, beef or pork is
forbidden in the religion because they find the cow sacred in their religion. That is around
800 million Indians who are restricted from eating any animal related food and this will have
a great impact on McDonald’s due to the great number of vegetarians. In general, majority of
the Indian diets are consisting of vegetarian foods. However McDonald’s faced this problem
and overcome it by offering a vegetarian themed menu for the Indian market. Instead of
ground beef and pork patties, the McDonald’s Menu in India features Indian burgers that are
100 percent vegetarian. The examples of the vegetarian products which McDonald’s offer in
India are Mcveggie, McAloo tika, VegMcCurry pan and many other vegetarian foods. Due to
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