Individual Composizione case study preparation paper Whether Natura, the Brazilian natural beauty company, based on biodiversity of Brazil, should expand it is business in Russian companies are the crucial issue of the case study. However , it is necessary to examine pre-issue prior to we assess the international expenditure strategy. After reviewing perhaps the company has the ability to of working with globalization, all of us move on to measure the Natura’s intercontinental marketing strategy.
Is definitely Russian the very best next step for Natura’s worldwide foot pertaining to?
If yes, all of us propose the possible alternatives for getting into this market by simply minimizing the political risk and functioning risk. (1) Was the firm ready to go the positive effect? Evaluating standards as follows: 5. Organization framework culture Natura’s unique organization cultures happen to be open-minded for opinion-expressing, translucent decision-making process, and closeness with its stakeholders. The solid corporate worth shared simply by every individual through this group make the expatriates out of this company may convey the manufacturer DNA in foreign marketplace. * Company visibility in global market segments
Natura provides a strong market position in Brazil, and continued increasing the brand picture in Latin American countries. However , that brand presence is not strong enough in the rest of community and the brand image can be weak inside the European countries as well. * Global resourcing and distribution network The natural material, production, product development is in Brazil. Natura provides yet built up the global logistic network, consequently , the syndication cost and inventory management would be the major problem for the company while it actions out worldwide. Insufficient experience in growth of global business, dealing with different civilizations, different cultural structure, and different consumer behaviors Much of the intercontinental business connection with Natura is limited in Latina American countries. Although there is diversification in traditions, consumer behaviors, the shut down countries were easier to handle the differences and minimize the marketing issues. However , throughout markets with totally different terminology, culture history, religion, regulations, Natura has no sufficient knowledge and understanding to manage this. Sufficient abilities in global management During this period, there do not sufficient managers with global vision and management expertise in Composizione. Even though managers from other firms have the skill in operating direct selling, they could hardly convey the company’s value and brand GENETICS. This shortage of human resource will be another hurdle for Natura’s globalization. Sub-conclusion: After analyzing Natura’s competences in globalization, we identified that Universo was merely at the beginning stage of the positive effect although it began its international business by 1982.
From the financial effect, we nonetheless could find away that Natura had no prominent performance in overseas market. (2) Was the Russian federation is the best choice to next step in Globalization? Is definitely Russian knowledge valuable to the Naura’s the positive effect? Assessment of Russian industry * Bureaucratic system 2. Unawareness of product top quality and unconcern about the surroundings and character. * Russian was getting familiar with the direct advertising, therefore , the training cost to get sales rep. and consumer can be relatively lower than other markets which have low acceptance in direct advertising.
Assessment of Russian beauty and skincare market * Consumer in Russia did not care about the natural products and knew absolutely nothing about Natura. They considered the intercontinental famous brands and local brands. Natura lacked of brand picture as good as P&G or L’Oreal. * It was a little while until time to build up its own neighborhood network in stakeholders since there is no manager who are able to deliver the brand DNA recognized the Russian market. 5. Mastering the delivery network in the Russian markets is the potential trouble for Composizione. Natura will face the challenges in global logistic while its goods were created, shipped by Brazil. The shipping expense, inventory management, timeliness of products, ordering system within part in Russia and parent or guardian company would be the key concern to increase business in Russia. * The weather in Russia is completely different from Brazil. It would be a primary concern that Russian would not like to trust a brand from Amazon region. * The local regulation in cosmetics and skin-care must also be taken into account. Sub-conclusion:
After assessing the real key factors in entering Russian market, we can find that the Russian market is not really mature enough to permeate for Natura which was not equipped with satisfactory experience in global organization management together a strong willing to preserve the brand GENETICS. Since Russian consumers are not respectful the nature and environment, the market did not attached to this brand DNA in this moment. Furthermore, due to the politics situation and business environment, the experience in Russia cannot duplicate or perhaps be applied following micro-adjustment in other western countries. 3) Subsequent preceding problem, if yes, precisely what is the best admittance strategy for the Russian market? If simply no, what is the best next step intended for Natura in globalization? Put together the examination above, stepping in Russian market would not so urgent or successful for Universo. For the international development, the best next step in globalization for Composizione should give attention to the grand American industry. There are several key pros to implement this plan, as follows: 5. USA industry has the comparable diversified cultural background and furthermore, the Latin American is one of the main cultural origins. American consumers are fairly mature in product know-how and prefer the natural skin-care product. Their pursuit in beauty is just as vigorous since the consumer in Latin American. * The business enterprise model of immediate selling in USA is definitely mature and consumers utilized to shop items in postal mail ordering and direct providing. * Finally, the facilities of logistic in regional market is ideal. * To get Natura, it will be a big help globalization whether it could be effective in USA market. The success in USA industry could increase the brand understanding and improve its position in bio-diversity beauty and skincare product.
Nonetheless, there were cons to enter USA market, including facing more fierce competition from other worldwide companies and it would be necessary more CAPEX to invest in the grand industry. If Universo take the Russian market while the must-be market, then we would recommend this company cooperate with the neighborhood leading business, Kalina, who had the good retail network and understood the local marketplace very well. Universo could use the franchise unit to broaden the Russian market and also to build up it is brand graphic and understanding through the Kalina’s advantages.
After Natura increasing experience and building up strong brand graphic, it could transform its business structure and enhance its company DNA and values. Underneath this strategy, presently there exist some potential hazards. For example , Natura had to produce a finished regulation about the personalisation in order to preserve the consistency and its beliefs. Natura needed to keep tight connection with franchisee to learn more community experience and react to industry needs. By the end of cooperation, it might need to pay higher selling price to buy backside the franchising right if its products performed very well in Russia.
