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International Business Management ( Final Project) - Assignment Example

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The issues are related to Foreign Direct Investments (FDI), which has enabled companies around the globe to integrate their business in the global…
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International Business Management ( Final Project)
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Download file to see previous pages The global expansion had increased their profit and market share in the global market; however, the company has also experienced numerous challenges in emerging markets like China.
China was regarded as the second largest growing nation in the world during 2010, whose annual growth was above 10% (US-Pacific Rim International, Inc., 2010). This has attracted many companies especially, the retail companies, to expand their business in China so as to cater the needs of the world largest population. Despite the growing economy and lucrative business market, the foreign companies failed to continue a successful business in China because of various strategic issues (US-Pacific Rim International, Inc., 2010). The same situation was encountered by Tesco PLC who entered China through foreign direct investment in 2004. The reason for selecting China is that, many well known international brands such as Wal-Mart, Carrefour and Tesco had to face a number of challenges and even failure due to a number of reasons; few of which is discussed in the report with respect to Tesco Plc. Therefore, it is quite interesting to know the fact behind the failure of Tesco plc to capture the Chinese market.
Tesco Plc entered China during 2004 with the help of 50:50 ventures with local retailer Hymall. Nevertheless, soon after few years in 2006, the company bought another 40% of the venture (Tesco, 2015; Telegraph Media Group Limited, 2015). Tesco PLC in China employs around 21,000 employees and had opened more than 62 stores and has the goal of opening hundreds of stores so as to reach every corner of China during 2009. Analysts have depicted the fact that the Chinese market has the ability to become the largest country for the business of Tesco. Nevertheless, Tesco Plc had experienced a number of issues in China, which have forced them to close many stores in the past three years (Song, 2013). The main issue was related to the failure ...Download file to see next pagesRead More
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