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International business: The economy of China - Assignment Example

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International Business Introduction The company is a UAE-based company started in 1950 as a family tailoring shop. Since then, the company has expanded and currently, it specialises in historic Islamic inventors. an example of this product is cannons that were worn used during Islamic medieval times…
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International business: The economy of China
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Download file to see previous pages The company is a UAE-based company started in 1950 as a family tailoring shop. Since then, the company has expanded and currently, it specialises in historic Islamic inventors. an example of this product is cannons that were worn used during Islamic medieval times. The company has a stable market given that it operates in a region where the Islam is the official and the largest state religion. Over the recent years, the company has experienced growth in its production and market share within the United Arab Emirates. The company would like to expand its operations to cover the overseas market, specifically China. The company was prompted to do this because of the increasing Islamic population in China yet there is only one company that produces these specific products.As stated above, the company was motivated to expand its operations to China because of the increasing Islamic population and yet there exists only one company that meets their specific needs related to products of historic Islamic inventors. The Muslim population in China includes both Chinese Muslims and immigrant Muslims. According to the 2009 census, there were 21,667,000 Muslims in China (Pew Research Center, 1). This is an indication that there is a large potential market for the products that will be produced by the company for the Chinese market. This market also has the potential of expanding due to the revival that Islam is experiencing in China. The company conducted a brief needs analysis among the customers in this market and found that some of the potential customers backed away from Historic Islamic inventors present in the market because of their high prices. This group mainly comprised of people of middle and low class. Basing on this information, the company established that there is a large and ready market in China for its products and it intends to use the low price strategy to capture this market. Even with lower prices, the company is bound to achieve an economic value in its operations in this market because of the expected high sales. There is a high concentration of Chinese Muslims and immigrant Muslims in urban areas compared to rural areas. There is therefore a high accessibility to the target market. Market Analysis China is a peaceful country and has enjoyed a good political stability over the recent years. Its political situation is therefore less likely to disrupt the operations of the company once it begins operating in it or when it starts exporting its products to China. The company is based in an Islamic country and therefore the political situation in relation to Islam in its target market is very important. Israeli (106) explains that in 1978, the Chinese government started to relax its policies towards Islam and currently, Muslims are not sidelined. The same applies to companies owned by Muslims or those based in Islamic companies. All other factors held constant, there are high changes of the company experiencing growth because of the existing political situation in China. The economy of China is good and this increases the chances of the company achieving good levels of business. (1) reveals that unlike the communist China, one important feature of the economy of the modern-day China is that it is based on private ownership of property. Being a private company, the economic climate of China is good for establishment and growth of the company in its overseas target market. The average economic situation among the Muslims specifically is also good and this means the company does not have to sell its products at a price too low to make significant profits. Although the 21.6 million Muslims comprise only 1.6% of the total population in China, this market is substantial for making good business. The infrastructure of China is well developed and therefore accessibility to customers will not be an issue to struggle with. With the nature of product that it produces, the operations of ...Download file to see next pagesRead More
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