David Hughes Professor of Agribusiness and Food
Description: David Hughes Professor of Agribusiness and Food Marketing, Imperial College, London theyve got nowhere else to go. Their domestic markets are saturated, so they are looking for countries with large populations, high population growth, per
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slide1. David Hughes Professor of Agribusiness and Food Marketing, Imperial College, London “they’ve got nowhere else to go. Their domestic markets are saturated, so they are looking for countries with large populations, high population growth, per capita GDP edging toward consumer levels, high income levels, and low supermarket presence. Countries with all five of these characteristics are a good bet, and companies rush to get there before everyone else.” Who is he talking about?<br>
slide2. Tesco UK
Main competitors
Tesco’s market share International expansion strategy
Why?
Where? [USA; Poland; Slovakia; Japan; South Korea; China]
3. How?<br>
slide6. Tesco in Japan 2001-03: research in retail markets and consumer purchasing patterns
Entry in2003 by acquisition: bought a Japanese discount supermarket chain with 78 stores using brand name Tsurukame
Continued expansion through acquisition<br>
slide7. Tesco in Poland Entry in 1995
Now has 100+ hypermarkets
2006 bought 220 convenience stores from Casino [a French rival]<br>
slide10. Vodafone buys into India's Bharti Vodafone Group, the world's biggest mobile phone company, has agreed to buy a 10% stake in Indian firm Bharti Tele-Ventures for $1.5bn (£841m). India now Nokia's second market Mobile phone maker Nokia says India has overtaken the US to become its second largest market in terms of sales. 2005 2007<br>
slide11. Vodafone buys into India's Bharti Vodafone Group, the world's biggest mobile phone company, has agreed to buy a 10% stake in Indian firm Bharti Tele-Ventures for $1.5bn (£841m). India now Nokia's second market Mobile phone maker Nokia says India has overtaken the US to become its second largest market in terms of sales. 2005 2007 Why have companies such as Vodafone and Nokia chosen to
target developing countries as a source of revenue?<br>
slide13. To examine the meaning of global sourcing and its impact on different stakeholders “Make” - insource Benefits And Risks Of “Make” v “Buy” Benefits:
Low risk of intellectual capital loss and technical know-how
High level of control
Cost savings retained in the business
Risks:
Large investment required to establish infrastructure, technology and personnel
High systems/technology maintenance costs Benefits:
Guaranteed and significant cost reductions
Focus on core competencies
Supplier will get Increased scale advantages from having many clients
Risks:
Higher risk of loss of intellectual capital and technical know-how
Costs savings shared with supplier “Buy”-outsource<br>
slide14. To examine the meaning of global sourcing and its impact on different stakeholders Make v. Buy Decision ?<br>
slide16. What is Globalisation ? The increased freedom and capacity of individuals and firms to:
undertake economic transactions with residents of other countries
operate on a global scale To examine factors which have made increased globalisation possible<br>
slide17. Examples of Globalisation Firms moving to lower cost locations
People moving to higher wage locations
Goods moving more freely around the world
Information moving more freely around the world To examine factors which have made increased globalisation possible<br>
slide18. Permissive factors Improvements in transport links
Improvements in communication links
A reduction in official obstacles/barriers and costs in conducting business with foreigners To examine factors which have made increased globalisation possible<br>
slide19. To examine factors which have made increased globalisation possible<br>
slide20. Containerisation To examine factors which have made increased globalisation possible<br>
slide21. To examine factors which have made increased globalisation possible<br>
slide22. Permissive factors Improvements in transport links
Improvements in communication links
A reduction in official obstacles/barriers and costs in conducting business with foreigners To examine factors which have made increased globalisation possible<br>
slide23. To examine factors which have made increased globalisation possible<br>
slide24. To examine factors which have made increased globalisation possible<br>
slide25. Permissive factors Improvements in transport links
Improvements in communication links
A reduction in official obstacles/barriers and costs in conducting business with foreigners To examine factors which have made increased globalisation possible<br>
slide27. Average Tariffs
in Industrial Countries To examine factors which have made increased globalisation possible<br>
slide28. The WTO deals with the rules of trade between countries
It developed from the General Agreement on Tariffs and Trade (GATT)
WTO agreements set the ground rules for international commerce<br>
slide29. To examine factors which have made increased globalisation possible<br>
slide30. Since WW2 there has been an exceptional growth in world trade.
Total trade in 2000 was 22-times the level of 1950.<br>
slide31. The ten benefits
1. The system helps promote peace 2. Disputes are handled constructively 3. Rules make life easier for all 4. Freer trade cuts the costs of living 5. It provides more choice of products and qualities 6. Trade raises incomes 7. Trade stimulates economic growth 8. The basic principles make life more efficient 9. Governments are shielded from lobbying 10. The system encourages good government<br>
slide32. How does trade help
a. firms stay competitive
b. consumers improve their living standards
What does ‘liberalisation of world trade’ mean?
How does the ‘safe harbours’ example illustrate the work of the WTO in making trade easier?
What is a boycott? Would it be a good idea to boycott goods made by child labour?
What is meant by trade sanctions? What examples are there of trade sanctions having been used?<br>
slide33. To examine factors which have made increased globalisation possible<br>
slide34. The European Union the impact of reduced trade and other barriers in the EU the impact of reduced trade and other barriers in the EU<br>
slide35. the impact of reduced trade and other barriers in the EU<br>
slide36. Japan, the EU, and the USA the impact of reduced trade and other barriers in the EU 500m 300m 130m<br>
slide37. Trading within the EU bloc Benefits of trading blocs
The economies of scale
argument
Greater efficiency
argument
Consumer benefits the impact of reduced trade and other barriers in the EU Problems with trading blocs
The Common External
Tariff
‘We pay more for our food’ argument
Protection imposes costs upon others and is inefficient<br>
slide38. Trading within the EU bloc Benefits of trading blocs
The economies of scale
argument
Greater efficiency
argument
Consumer benefits the impact of reduced trade and other barriers in the EU<br>
slide39. Trading within the EU bloc the impact of reduced trade and other barriers in the EU Problems with trading blocs
The Common External
Tariff
‘We pay more for our food’ argument
Protection imposes costs upon others and is inefficient<br>
slide40. Trading within the EU bloc Benefits of trading blocs
The economies of scale
argument
Greater efficiency
argument
Consumer benefits the impact of reduced trade and other barriers in the EU Problems with trading blocs
The Common External
Tariff
‘We pay more for our food’ argument
Protection imposes costs upon others and is inefficient<br>
slide41. Different views UK interests best served
within the EU
[1973 position] UK should leave the EU
[pre-1973 position] the impact of reduced trade and other barriers in the EU<br>
slide42. Different views The EU should be just
about free trade in goods
[pre 1992 situation] The European market in
goods, labour and capital
[1993 onwards] has
benefitted the majority of
Europeans the impact of reduced trade and other barriers in the EU<br>
slide43. Different views The EU single market
works best with a single
currency [the euro since
2002] and a European
Central Bank which sets
interest rates for the
Eurozone. The European single
market in goods, labour
and capital [1993
onwards] has benefitted
the majority of Europeans the impact of reduced trade and other barriers in the EU<br>
slide44. Different views The EU single market
works best with a single
currency [the euro since
2002] and a European
Central Bank which sets
interest rates for the
Eurozone. The European single
market needs to integrate
further by introducing tax
harmonization the impact of reduced trade and other barriers in the EU<br>
slide45. the impact of reduced trade and other barriers in the EU<br>
slide46. The European Union the impact of reduced trade and other barriers in the EU the impact of reduced trade and other barriers in the EU<br>
slide2. Tesco UK
Main competitors
Tesco’s market share International expansion strategy
Why?
Where? [USA; Poland; Slovakia; Japan; South Korea; China]
3. How?<br>
slide6. Tesco in Japan 2001-03: research in retail markets and consumer purchasing patterns
Entry in2003 by acquisition: bought a Japanese discount supermarket chain with 78 stores using brand name Tsurukame
Continued expansion through acquisition<br>
slide7. Tesco in Poland Entry in 1995
Now has 100+ hypermarkets
2006 bought 220 convenience stores from Casino [a French rival]<br>
slide10. Vodafone buys into India's Bharti Vodafone Group, the world's biggest mobile phone company, has agreed to buy a 10% stake in Indian firm Bharti Tele-Ventures for $1.5bn (£841m). India now Nokia's second market Mobile phone maker Nokia says India has overtaken the US to become its second largest market in terms of sales. 2005 2007<br>
slide11. Vodafone buys into India's Bharti Vodafone Group, the world's biggest mobile phone company, has agreed to buy a 10% stake in Indian firm Bharti Tele-Ventures for $1.5bn (£841m). India now Nokia's second market Mobile phone maker Nokia says India has overtaken the US to become its second largest market in terms of sales. 2005 2007 Why have companies such as Vodafone and Nokia chosen to
target developing countries as a source of revenue?<br>
slide13. To examine the meaning of global sourcing and its impact on different stakeholders “Make” - insource Benefits And Risks Of “Make” v “Buy” Benefits:
Low risk of intellectual capital loss and technical know-how
High level of control
Cost savings retained in the business
Risks:
Large investment required to establish infrastructure, technology and personnel
High systems/technology maintenance costs Benefits:
Guaranteed and significant cost reductions
Focus on core competencies
Supplier will get Increased scale advantages from having many clients
Risks:
Higher risk of loss of intellectual capital and technical know-how
Costs savings shared with supplier “Buy”-outsource<br>
slide14. To examine the meaning of global sourcing and its impact on different stakeholders Make v. Buy Decision ?<br>
slide16. What is Globalisation ? The increased freedom and capacity of individuals and firms to:
undertake economic transactions with residents of other countries
operate on a global scale To examine factors which have made increased globalisation possible<br>
slide17. Examples of Globalisation Firms moving to lower cost locations
People moving to higher wage locations
Goods moving more freely around the world
Information moving more freely around the world To examine factors which have made increased globalisation possible<br>
slide18. Permissive factors Improvements in transport links
Improvements in communication links
A reduction in official obstacles/barriers and costs in conducting business with foreigners To examine factors which have made increased globalisation possible<br>
slide19. To examine factors which have made increased globalisation possible<br>
slide20. Containerisation To examine factors which have made increased globalisation possible<br>
slide21. To examine factors which have made increased globalisation possible<br>
slide22. Permissive factors Improvements in transport links
Improvements in communication links
A reduction in official obstacles/barriers and costs in conducting business with foreigners To examine factors which have made increased globalisation possible<br>
slide23. To examine factors which have made increased globalisation possible<br>
slide24. To examine factors which have made increased globalisation possible<br>
slide25. Permissive factors Improvements in transport links
Improvements in communication links
A reduction in official obstacles/barriers and costs in conducting business with foreigners To examine factors which have made increased globalisation possible<br>
slide27. Average Tariffs
in Industrial Countries To examine factors which have made increased globalisation possible<br>
slide28. The WTO deals with the rules of trade between countries
It developed from the General Agreement on Tariffs and Trade (GATT)
WTO agreements set the ground rules for international commerce<br>
slide29. To examine factors which have made increased globalisation possible<br>
slide30. Since WW2 there has been an exceptional growth in world trade.
Total trade in 2000 was 22-times the level of 1950.<br>
slide31. The ten benefits
1. The system helps promote peace 2. Disputes are handled constructively 3. Rules make life easier for all 4. Freer trade cuts the costs of living 5. It provides more choice of products and qualities 6. Trade raises incomes 7. Trade stimulates economic growth 8. The basic principles make life more efficient 9. Governments are shielded from lobbying 10. The system encourages good government<br>
slide32. How does trade help
a. firms stay competitive
b. consumers improve their living standards
What does ‘liberalisation of world trade’ mean?
How does the ‘safe harbours’ example illustrate the work of the WTO in making trade easier?
What is a boycott? Would it be a good idea to boycott goods made by child labour?
What is meant by trade sanctions? What examples are there of trade sanctions having been used?<br>
slide33. To examine factors which have made increased globalisation possible<br>
slide34. The European Union the impact of reduced trade and other barriers in the EU the impact of reduced trade and other barriers in the EU<br>
slide35. the impact of reduced trade and other barriers in the EU<br>
slide36. Japan, the EU, and the USA the impact of reduced trade and other barriers in the EU 500m 300m 130m<br>
slide37. Trading within the EU bloc Benefits of trading blocs
The economies of scale
argument
Greater efficiency
argument
Consumer benefits the impact of reduced trade and other barriers in the EU Problems with trading blocs
The Common External
Tariff
‘We pay more for our food’ argument
Protection imposes costs upon others and is inefficient<br>
slide38. Trading within the EU bloc Benefits of trading blocs
The economies of scale
argument
Greater efficiency
argument
Consumer benefits the impact of reduced trade and other barriers in the EU<br>
slide39. Trading within the EU bloc the impact of reduced trade and other barriers in the EU Problems with trading blocs
The Common External
Tariff
‘We pay more for our food’ argument
Protection imposes costs upon others and is inefficient<br>
slide40. Trading within the EU bloc Benefits of trading blocs
The economies of scale
argument
Greater efficiency
argument
Consumer benefits the impact of reduced trade and other barriers in the EU Problems with trading blocs
The Common External
Tariff
‘We pay more for our food’ argument
Protection imposes costs upon others and is inefficient<br>
slide41. Different views UK interests best served
within the EU
[1973 position] UK should leave the EU
[pre-1973 position] the impact of reduced trade and other barriers in the EU<br>
slide42. Different views The EU should be just
about free trade in goods
[pre 1992 situation] The European market in
goods, labour and capital
[1993 onwards] has
benefitted the majority of
Europeans the impact of reduced trade and other barriers in the EU<br>
slide43. Different views The EU single market
works best with a single
currency [the euro since
2002] and a European
Central Bank which sets
interest rates for the
Eurozone. The European single
market in goods, labour
and capital [1993
onwards] has benefitted
the majority of Europeans the impact of reduced trade and other barriers in the EU<br>
slide44. Different views The EU single market
works best with a single
currency [the euro since
2002] and a European
Central Bank which sets
interest rates for the
Eurozone. The European single
market needs to integrate
further by introducing tax
harmonization the impact of reduced trade and other barriers in the EU<br>
slide45. the impact of reduced trade and other barriers in the EU<br>
slide46. The European Union the impact of reduced trade and other barriers in the EU the impact of reduced trade and other barriers in the EU<br>