Potential Risks the Company Encounters Entering the New Market
The modern manager should have the skills to manage risk and choose an effective and consistent business strategy based on internal and external analysis of the company. In a highly competitive market environment, a business that has considered and anticipated all possible challenges and opportunities has a greater chance of success. This scenario-based essay analyzes the strengths and weaknesses of a mechanical boat company, identifies the potential risks of entering a new market, and creates a business strategy to increase the chances of stable development and growth.
The Indian market is promising and tempting for the company in terms of profits and opportunities. The fishing industry in the country is well developed, and a whole class of companies and entrepreneurs in this economic sector has been formed among members of the working professions. Despite all the promises, every market has potential risks, and India is no exception in this case. The first point at which a company should be careful is the problem of plastic production in India. Most likely, the manufacturer has reliable sources of raw materials outside this country, supplying quality products to the company’s production facilities for the past three years.
The Indian government has taken a rather tough stance because there are serious waste management problems in such an overpopulated and industrially active country. A second potential risk is the ability to use the company’s folding boats only in calm waters. Fishing boats often go out to fish in rough seas and storms, which means the company’s main product may not be functional or safe. In contrast, the calm waters of the Ganges River in its middle reaches are perfect for folding eco-friendly boats.
SWOT Analysis
Two Internal Strengths of the Company
SWOT analysis is one of the most common analytical methods, which allows a comprehensive assessment of the strengths and weaknesses of the company, as well as opportunities and threats, affecting it (Pyut, et al., 2020). An important positive aspect of the company’s internal set-up is the drive for innovation. The creation of advanced business labs, the recruitment of modern and young employees, and the integration of advanced software components into the product development process can help to increase interest in both boats and the traditional topic of fishing itself. A second advantage is the business’s organizational structure, useful for operational communication with management, the opportunity for each employee to influence decision-making and product development, and supports a spirit of cooperation.
Two Internal Weakness of the Company
There are possible problems with the organizational structure. Employees of all ranks can influence potentially crucial decisions in the company, which requires a high level of competence among employees at all levels. Mistakes in the recruitment process can then have unintended consequences when a certain wrong decision is supported by employees but turns out to be fatal. In addition, quality professionals require a high level of remuneration. The second vulnerability of the internal structure is that there is only one main product. Product diversification reduces the risks of failing to launch one of these products, but when there is only one product, difficulties in marketing cause great problems.
Two External Opportunities for the Company
A great opportunity for the company is that Indian legislation is loyal to this kind of boat, making it easier to sell the goods in the local market. The second potential window of opportunity is the consequence of a sound design department policy. India is not a wealthy country, but the successful, optimized design of the folding boat combined with inexpensive local resources allows the product to be sold at a lower price and to a larger number of interested parties.
Two External Threats to the Company
In addition to opportunities, there are always potential threats in the marketplace. Two important risks can be identified in this scenario. Since the products capture a wide range of end-users, the right decision for the company was to involve local fishermen in the testing and design of the boats. There will be a plurality of opinions, so there may be a threat of an unbalanced product, which will not prove very functional. The second threat is that local consumers may not appreciate the new innovative boats in preference to their proven working tools. The risk is also increased by the fact that India is a country with strong conservative cultural tendencies.
Analysis Aftermath
After conducting a SWOT analysis and assessing possible risks, a strategy can be developed to increase the chances of successful entry into new markets. First, the company should gather data on the most proven chemical companies in the country that can supply high-quality plastics. Another way is to sign a memorandum of cooperation with existing suppliers, creating a joint venture with proven specialists already working in India. In addition, managers need to have verified data, such as from the Indian Fisheries Department, on how many percent of fishermen are working in river and ocean waters to estimate possible sales.
There also needs to be a thorough human resources policy, even creating a special department to work with India that includes both subject matter experts and local experts (Department of Fisheries, 2022). For the product to win the information competition from local boats, the marketing department must conduct a competent advertising campaign, clearly illustrating the product’s benefits. The company will get tangible bonuses from implementing all the strategies mentioned above. It will enter the market with the necessary production raw materials and form an understanding of the target area, allowing it to make an adequate financial and investment plan and create an attractive informational image of these quality and environmentally friendly vehicles.
References
Ministry of Fisheries. Animal Husbandry and Dairyng Government of India. (2022). Annual Report 2021- 2022. Web.
Puyt, R., Lie, F. B., De Graaf, F. J., & Wilderom, C. P. (2020). Origins of SWOT analysis. In academy of management proceedings. Briarcliff Manor, NY 10510: Academy of Management, 2020(1). p. 1-6. Web.