Signature Assignment: Challenges of Expansion to a Foreign Location

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SSryvk038

Economics

Description

Select a foreign market in which to expand your chosen product. (Amazon is my product)

Prepare a minimum1,750-word report addressing the points listed below. The use of tables and/or charts to display economic data over the time period discussed is highly encouraged, you may submit any economic data in Microsoft® Excel® format in a separate file. You may use the U.S. Department of Labor's Bureau of Labor Statistics (BLS), U.S. Dept. of Commerce's Bureau of Economic Analysis (BEA), the Federal Reserve of St. Louis's FRED data, the CIA World Fact Book, World Bank data, and World Trade Organization, or other appropriate sources you might find on the Internet or in the University Library. The new sections of your report should:

  • Evaluate current global economic conditions and their effects on macroeconomic indicators in your selected country. Provide forecasts for population growth, gross domestic product (GDP) growth, GDP per capita growth, export growth, and sales growth.
  • Evaluate any competitors' existing production in the chosen country.
  • Assess sales forecasts in the selected country by using the Federal Reserve of St. Louis's FRED data, the CIA World Fact Book, World Bank data, World Trade Organization, or other appropriate sources you might find on the Internet or in the University Library.
  • Categorize the type of economy that exists in your selected country as closed, mixed, or market. What is the difference between these types of economies and how might this affect your expansion?
  • Assess how your chosen country's current credit market conditions, especially interest rates and the availability of financing, affect demand for your product or service and your planning or operating decision for your production in that country.
  • Analyze the role of the selected country's central bank on that country's economy.
  • Compare the availability, education, and job skills of the work force in the selected country. Discuss any additional challenges of international production, such as political stability, availability of government financing or other incentives, threat of capital controls, and exchange rate risks.
  • Explain any additional supply chain challenges you anticipate if attempting to make your product in your chosen country and selling the product in other countries.
  • Based on the data gathered and analysis performed for this report write a conclusion in which you:
    • Create business strategies, including price and non-price strategies, based on your market structure to ensure the market share and potential market expansions and explore global opportunities for your business in a dynamic business environment and provide recommendations.
    • Develop a recommendation for how the firm can manage its future production by synthesizing the macroeconomic and microeconomic data presented.
    • Propose how the firm's position within the market and among its competitors will allow it to take your recommended action.
    • Recommend strategies for the firm to sustain its success going forward by evaluating the findings from demand trends, price elasticity, current stage of the business cycle, and government.
    • Recommend any comparative advantages your company will have over competitors currently operating in that country, and defend your position, either for or against, expanding your company's production into your chosen country based on your research.

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Explanation & Answer

Attached.

Amazon Expansion to the South Korean Market
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Introduction
The South Korean market is the fourth largest economy in Asia and the 11th largest in the
globe. As a mixed economy, this market is dominated by the family owned-conglomerates. South
Korea is recognized for its spectacular rise from one of the poorest countries to one of highdeveloped and high income country in Asia. In 2018, President Moon Jae-in announced a fresh set
of measures that will ensure a boost in the country’s economic growth and creation of employment
opportunities by offering financial support for the smaller companies. As this country’s market is
growing, Amazon.com had an opportunity to invest and improve the level of its performance.
Current global economic conditions and their effects on macroeconomic indicators in your
selected country
In 2017, President Moon Jae brought in a surge in consumer confidence following the
successful effort to increase the government expenditure and wages (Jung-a 2018). As of 2017,
the Gross Domestic Product (G.D.P) was $ 1,540/46 billion with a growth rate of 3/1% from 2016.
The forecasted G.D.P, according to statistica, is $1,655.61 billion. The country’s population as of
July 2018 was 51.4 billion, with a growth rate of 0.44%.Ideally, the forecasted population of 2019
is 51.66 billion. South Korea’s G.D.P per capita as of 2017 was $39,500 billion and the forecasted
amount of 2018 is $38,200 billion. The total export of commodities in South Korea is currently
floating at $577.4 billion and is projected to be $549.43933 billion as of 2018. The South Korean
economy is growing and is extensively advancing over the years. Essentially, the rise in the G.D.P
in the country makes it easier to attract both local and foreign investors. The forecasts provided by
statistica indicate a possible increase in the development of the nation’s economy. In addition , the
growing population is essential in the creation on a large consumer based and development of a
skilled and reliable labor work force. The country’s current retail sales trade at $40, 682 million

and is expected to rise of $45,365 million in 2018. With such a structure, Amazon.com can take a
chance to enter the market for its improvement.
Existing Competitor
South Korea has the seventh largest e-commerce market across the globe. Essentially, it is
the third...


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