Export Strategy for Sweden Market - Term Paper Example

EXPORT STRATEGY FOR SWEDEN MARKET al Affiliation An export strategy for conquering UK market requires an implementation plan that enables a firm to engage in international trade and overcome all the trade restrictions in the target country. Not only does the export strategy foster growth but also takes into account all the cross-border collaborations that are risk-free and feasible in the UK market. One of the appropriate export markets for the Asian firm is Sweden. The export strategy herein will address the international trade theories, trade restrictions, logistics, transport modes and strategic decision with respect to the Sweden commerce environment for foreign firms. The Appropriateness of Sweden Market The Board of Directors should be cognizant of the recent economic crisis that destroyed the financial platforms for many countries in EU. However, Sweden avoided financial crisis through watertight and strong economic foothold. According to OECD Economic Surveys (2013), the country GDP is expected to grow by 2.5 percent by the end 2015, which is a great mileage that any economic giant in EU could achieve. The country aims at reducing the levels of unemployment though the current rate averages at 8.5 percent. The organization targets to concentrate on manufacturing and engineering services. Schön, (2012) argues that the Swedish economy has grown over the years to become one of the advanced nations in the engineering manufacturing. The organization also aims at participating in the efforts to eliminate unemployment rates in Sweden. Will not only the export-entry strategy feature provision of employment for the locals but also match with the increasing need for services that are in tandem with advanced information communications technology. Export Strategy The exportation will feature a direct strategy for products in the manufacturing and engineering sector. The country has a high demand for the services and a long-standing tradition in mining, shipbuilding and IT products. The products must be in keeping with the sustainability and earth-friendly innovations and competitive in terms of price and quality (Schön, 2012). Additionally, the export strategy recognizes the international trade theories. Suitable International Trade Theories The process of developing an export strategy for Sweden was informed by the international trading theory, which includes country similarity and product life cycle theories. Being an Asian form calls for a strategy that features expansion to the competitive global market. The strategy also acknowledges the trade flows that include customer loyalty, advanced technology, and quality. Country similarity theory is founded on the concept of intra-industry trade (Gandolfo, 2014). Our organization targets Sweden because the consumers there are in the same development stage. There is a growing demand for manufacturing and engineering in the domestic market while Sweden is looking for exports that can provide consistent supply in the same area. The per capita income for our parent country and Sweden may be dissimilar, but there is a huge chance of success where products will have unique names and reputation once they hit the market. Product life cycle theory acknowledges the different stages of product development (Kerr and Gaisford, 2007). The export strategy for our organization will feature a manufacturing and engineering operation in the home countries. The firm will produce goods in the parent country and transport them for repackaging to Sweden. The production process in the home country features low-cost strategies when compared to putting up manufacturing and engineering plants in Sweden. Coping With Instruments of Trade Protection in Sweden The firm intends to overcome new import duties and tariffs in the Swedish market through provision rates. The financial crisis in most of EU market elicited trade restrictions in a bid to protect domestic firms. Sweden was immune to the financial crisis in 2008-2009, and that will enable the organization to take advantage of the Open Trade Gate (Broz and Werfel, 2014). The platform will give the firm a chance to strengthen its capacity and ability to trade in the foreign market. Additionally, The Swedfund will offer a crucial precaution against high tariffs and customs duties that define trade restrictions for foreign firms. According to Gawande, Krishna and Olarreaga (2012) Sweden offers risk capital and financial support for Asian firms besides the EU organizations. The export strategy is a form of investment in a promising foreign market. The trade promotion and invest tools will create a robust new market for our firm and boost the economy of Sweden. Pricing strategy is based on duty, VAT, and minimum threshold. The import duty 48%, VAT of up to 25%, and minimum threshold waiver of SEK1300 are applicable (Tullverket.se, 2015). The firm will also consider excise duties and additional customs fees during examination and verification outlets. The organization will contend with local competition from companies such as Alten, Dynapac, Volvo, and Tranter. Trade Restrictions Coping Approaches, Promotion and Investment Tools The free trade agreement will provide a safe exploitation of marketing opportunities in Sweden (Svensson, 2012).The free trade agreements negotiation will occur between the investors in the organization and the relevant government bodies. The agreements will acknowledge the taxation and commerce policies and legislations involving exportation. The cross-border collaboration will increase growth prospects because of the open trade oriented economy. Exporting will overcome a number of risks common in the Swedish market. The country has low interest, and a negative policy rate might affect the profit margins (Boyer and Schuschny, 2010). The purchasing power of the manufacturing and engineering consumers is high, but the country has limited opportunities for growth due to stiff competition from rival EU firms. The Swedish IT market is still slow, and that might offset the logistics of exports during advertisement, promotion and transportation of the export products. Logistics Our organization objective is to offer on-time delivery and planning of the export products. The cargo that will be transported by sea, air, rail, road and train will be second-to-none services will be reliable. The manufacturing and engineering products in Sweden market will be open to the documentation on all inbound clearances processes. A coordination of scheduling and reliable transportation and proactive management will give rise to a firm that saves time and cost. The ultimate modes of transport that will be used include road, train, sea and air. Sweden assigns sea transportation for international firms, but the organization will negotiation will negotiate to have air, rail, and road transport to achieve its timely logistics objectives (de Jong et al., 2012). The sea transport will establish docking agreements with Port of Stockholm, Goteborg, Trellerborg and professionals such as HML shipping to create a network that can penetrate into the country fast. The high-speed rail and air transport will increase coordination within the Swedish local marker and increase the capacity of the organization to deliver products on a timely basis. The business culture of Sweden features utmost punctuality (Svensson, 2012). Therefore, proper schedules and plan will be complimented with reliable modes of transport. The information and technology level of Sweden is expected to grow by 4.1 percent by 2019 and that will render the exportation platforms highly lucrative (Gopal, 2008). There are a high support data-network infrastructure, real-time business services and cloud computing that will complement the transportation and sales logistics. Sweden has been ranked a leading economy in digital growth in the EU. Management and tracking of exported products will be trouble-free as outsourcing, virtualizing, and moving services become real in the foreign market (Organisation for Economic Co-operation and Development, 2002). Information and technology provide reliable services foreign or domestic exportation. In the light of IT infrastructure in the company will align telecommunications, transportation, and information services relevant structures in the country. Incorporating Strategic Decision-making The organization aims to implement the export strategy using ethical practices in the strategic decision-making. The ethical practices will feature environmental sustainability, anti-corruption and gender equality in all strategic operations. The improving working environment will be as important as integrating sustainability approaches during export. Every Swedish firm is tasked with corporate social responsibilities to manage major activities (Høgevold and Svensson, 2012). The government requires local and foreign firms to adopt recycling, sustainable manufacturing to reduce environment carbon footprint. The strategy is subject to Climate Counts that monitors leading firms such as Electrolux. Gender equality will play a role in administering ethical work practices; parents will be capable of administering care to their children through gender-based working schedules. The workers will assume work and family responsibilities and occupy leading positions in the chain of command. Sweden is a fourth nation in the world to implement gender equality practices as required by the Global Gender groups (Olah and Gahler, 2014). Fighting corruption will be a key factor and the company will not participate in any illicit transport during dispatch, transportation or custom checking of its products. Sweden has low corruption cases, and the situation helps Swedish firms to perform better in the international market than other foreign countries (Rothstein and Teorell, 2015). The corruption free export trade will promote the international operation and uplift the image of the organization to the Swedish officials as well as target consumers. The conventions of European Council prohibit firms from participating in illicit international business relationships. Summary Sweden makes the rules clear for firms want to enter the export market. The organization will implement the export strategy in a straightforward manner and increase relations than can reduce the unemployment rates. The welfare of Swedish people is crucial, and that calls firms to have export entry strategies that can protect and serve the economy accordingly. The logistics, risks, IT infrastructure and mode of transports have been highlighted with respect to the current situation in Sweden. The plan highlighted is feasible and fit for implementation. References List Boyer, I. and Schuschny, A. 2010. Quantitative assessment of a free trade agreement between MERCOSUR and the European Union. Santiago, Chile: Naciones Unidas, CEPAL. Broz, J. and Werfel, S. (2014). Exchange Rates and Industry Demands for Trade Protection. International Organization, 68(02), pp.393-416. de Jong, G., Vierth, I., Tavasszy, L. and Ben-Akiva, M. 2012. Recent developments in national and international freight transport models within Europe. Transportation, 40(2), pp.347-371. Gandolfo, G. 2014. International trade theory and policy. Berlin [u.a.]: Springer. Gawande, B., Krishna, P. and Olarreaga, M., 2012. LOBBYING COMPETITION OVER TRADE POLICY*. International Economic Review, 53(1), pp.115-132. Gopal, C. (2008). Export import procedures. New Delhi: New Age International. Høgevold, N. and Svensson, G. 2012. A business sustainability model: a European case study. Jnl of Bus & Indus Marketing, 27(2), pp.142-151. Kerr, W. and Gaisford, J., 2007. Handbook on international trade policy. Cheltenham, UK: Edward Elgar. OECD Economic Surveys., 2013. Paris: OECD Pub. Olah, L. and Gahler, M., 2014. Gender Equality Perceptions, Division of Paid and Unpaid Work, and Partnership Dissolution in Sweden. Social Forces, 93(2), pp.571-594. Organisation for Economic Co-operation and Development., (2002). Information Technology Outlook 2002. Paris: Organisation for Economic Co-operation and Development. Rothstein, B. and Teorell, J., 2015. Getting to Sweden, Part II: Breaking with Corruption in the Nineteenth Century. Scandinavian Political Studies, p.n/a-n/a. Schön, L.,2012. An economic history of modern Sweden. London: Routledge. Svensson, R. , 2012. Success Strategies and Knowledge Transfer in Cross-Border Consulting Operations. 6th ed. Boston, MA: Springer US. Tullverket.se, 2015. Importing goods to Sweden from countries outside the EU - Tullverket. [online] Available at: http://www.tullverket.se/en/business/importinggoodstoswedenfromcountriesoutsidetheeu.4.230c8d84122d2a4008e80006078.html Read More