Transnational Retailer Expansion and Performance - Research Proposal Example

transnational retail al Affiliation) Which factors have been determining transnational retailer expansion and performance? In transnational retailer expansion and performance, when the multinational retailers expand their activities, it is extremely crucial for the organizations to seek a specific degree of control over their operations in foreign markets (Saull, 2012). Therefore, the maintenance of control is fundamental in implementing the global strategies of the particular retailer. This is the main reason why the marketing managers in charge of international operations should analyze and understand the factors that influence the control of their retail organization over the foreign operations. These same forces influence the growth of globalization, which is the ongoing political, economic, and social process that deepens the interdependency amongst nations. In the world today, approximately 25 percent of the produce globally is sold outside the country from which they originated (Boyer, 2012). This is due to the continuous reduction in the restrictions that concern imports and exports. This has helped the expansion of multinational retail, as the retailers take advantage of these incentives to venture into foreign markets. In addition to the reduction in import restrictions, the regional trade agreements signed amongst various countries have enabled the retailers to reduce the costs of foreign licensing, as the globe is transforming towards the reliance in regional trade balances (Dicken, 2011). The easy movements of resources across borders are a factor that influences the retail activities all around the world. Contrary to the previous trends that made it difficult to move resources across the precincts, this current trend facilitates mechanisms that increase the access of retailer resources in the foreign market (Connell, 2005). Besides, the trade restrictions on foreign investment allow foreign retail investors to open multiple store branches across a foreign market. This is coupled with the increasing need of governments to fulfill the overgrowing customer tastes in trying foreign retail services and products. In a bid to diversify the consumer tastes, Marks and Spencer ventured into the Italian dressing industry, opening multiple stores that competed against the trademark Italian Giorgio Armani cloth line. This example has championed the growth of economic blocs, such as the COMESA, NATO, and European Union that have general agreements on the conditions of trade as well as suitable tariffs (Schmalz & Ebenau, 2012). The expansion of multinational retail services and activities is attributed to the expansion in cooperation of cross-national ties Nolke, ten Brink, Claar, & May, 2014). The entry of governments into tiny cross-national treaties has expanded the interest of the domestic firms in the countries. This political factor accrues from the need of a country to counter a certain problem, such as inadequate food or power supply, or terrorism. In the European Union, the formation of the Community Agricultural Policy encouraged the internationalization of various farm product retailers, such as Tesco with branches in France, Ireland and other countries. Tesco is a leading supermarket branch that has its headquarters in England. These political agreements involve economic implications, which benefit the signatories of the treaties (Becker & Jäger, 2012). Under most circumstances, these cross-national ties operate under the frameworks of international organizations such as United Nations, The World Trade Organization, The International Monetary Fund, and the World Bank. Apart from the international ties, the increased global competition boosts the expansion of transnational retail services. These pressures obligate these retail services to expand their services from a domestic market into the multiple national markets (Montgomerie & Young, 2011). Besides, the profitable success registered by the retailers who went into the transnational trade persuades other domestic retailers to venture into the international retail market. In the case study of Morrison Retail Chain, the urge to venture in international retail was as a reactionary tactic to keep up with their major competitors in the UK, The Tesco, and Sainsbury Supermarkets. This is the current motivation behind the growth of transnational retail, as the foreign opportunities improve the competitiveness and operational flexibility of a retail service provider beyond the domestic market. Moreover, the economic development around various nations in the world sets a platform for the development of services that support the growth and expansion of transnational retail. Such services as banks and financial institutions provide the much-needed capital through credit, which is critical for the establishment of businesses. Other services such as storage facilities and warehouse services encourage the bulky inflow of a variety of goods from a particular retailer (Bakker, 2007). Wal-Mart Retail Chain was amongst the first American retailers to go global, taking advantage of the equal infrastructural developments that Canada had, to set up multiple stores in the neighboring country. Furthermore, the government provides transport and infrastructure that enables the retailers to easily penetrate and explore the host- nation resource base. The performance of transnational retailers depends substantially on the vast technological advancement. Through technology, information about the market conditions flows faster, hence improving the effectiveness of the services. Contrary to the past when the retailers relied on restricted means to acquire information about foreign markets, the internet has revolutionized the flow of information (Dicken, 2011). Amazon UK, the largest online retailer, is a beneficiary of the advanced internet sales mechanisms that define the modern retail sector. Through this, Amazon attracts the largest customer base, ahead of Argos and Apple in multiple European countries, selling diversified products that satisfy the different customer tastes. Besides, the existence of modern transport and technology infrastructure enables the retailers to move skills and resources efficiently across borders. Evidently, the performance of transnational retailers depends on the prevailing political situations (Crotty, 2009). The economic world is reaping the benefits of a transformed political environment. For instance, transformations in the People’s Republic of China and the former Soviet Union have championed the vast expansion of trade between the two countries. China, being a technological giant, has the largest technological retail base in the former USSR (Dicken, 2011). These retailers sell electronic appliances and communication gadgets that control the larger consumer base in the market. In conclusion, the factors that influence the internationalization of the retail sector spans over a number of factors, categorically political, economic, technological, and social. This explains the constant innovation of methods to improve competition amongst the retail service providers, with the domestic competitiveness left for the new entrants of the retail industry. Besides, transnational retails stabilize the market prices, hence protecting the consumers. In addition to that, the transnational retails experience increased profits and sales from the wider customer base. 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