The entry of Falke group on the Saudi Arabia market

Résumé du document

Facing an increasingly difficult economic environment in Europe, the FALKE Group as a traditional German family business, needs to enlarge its perspectives in future and think about entering further markets. Due to its organizational structure and its size, the company has always operated in relatively known domain. As the Arabian market offers enormous potential owing to its population growth, market size and wealth, a special research team has investigated the business environment, the society and the culture of Saudi Arabia, in particular, to develop an appropriate market entry strategy in order to make use of the promising opportunities for investment, the country provides. The following analysis will determine the reasons for entering such a market and explains the market's attractiveness and verifies the reasons for establishing a joint venture with a Saudi partner.

Extraits

[...] The selling personnel was trained on the specific brand offered and thereby could provide specific information about materials, production and design. In December 2002, FALKE owned over 92 Shop-in-Shops of which 71 are located on the national and 21 on the international level. The third step FALKE took into account concerning the development of its retail system was the establishment of so-called flagship stores. These stores are, alike boutiques, owned by the manufacturer and thereby represent the POS where the producer directly sells his products to the end- consumer without any other intermediaries. [...]

[...] The entry of Falke group on the Saudi Arabia market I Executive Summary Facing an increasingly difficult economic environment in Europe, the FALKE Group as a traditional German family business, needs to enlarge its perspectives in future and think about entering further markets. Due to its organisational structure and its size the company has always operated in relatively known terrain, but is about to look out for new challenges. As the Arabian world offers enormous potential as far as population growth, market size and wealth is concerned, a specialist research team has investigated the business environment, the society as well as the culture of Saudi Arabia, in particular, to develop an appropriate market entry strategy in order to use the promising opportunities for investment the country provides. [...]

[...] Subsuming, the project team can only recommend the implementation in the Saudi Arabian apparel market. If FALKE's objective is to aim at long-term revenues with long-lasting and secured business relations and promising further expansion opportunities, Saudi Arabia is the answer. VII REFERENCES Literature Barth, H. K.; Schliephake, K. (1998): “Perthes Länderprofile: Saudi Arabien“, published by Justus Perthes Verlag Gotha GmbH, Gotha 1st edition Deputy Ministry For Industrial Affairs (1998/1999): “Development of Industry During one Hundred Years 1319 1419 published by the Kingdom Of Saudi Arabia, Ministry of Industry And Electricity, 1998/1999 Electrical Affairs Agency (1998/1999): “Electricity Growth And Development in the Kingdom Of Saudi Arabia up to the Year 1419 H (1998 / 1999 published by the Kingdom Of Saudi Arabia, Ministry of Industry And Electricity, Studies And Statistics Department FALKE annual report 2002/ 2003 Foreign Information Department: “Kingdom of Saudi Arabia The march of progress”, published by the Saudi Arabian Ministry of Information Harmsen, N. [...]

[...] The following table points out the revealed chances and risks for FALKE when implementing a sales office in the Saudi Arabian market. Table Chances and Risks of Business Activity in the K.S.A. VI Next steps and actions of implementation Having decided for Saudi Arabia and Jeddah as business destination and next target for FALKE's expansion, the first main objective is to find an appropriate Saudi partner with whom to found the joint venture. As already mentioned above, the GESALO is a competent counterpart. [...]

[...] Having several licence contracts with strong brands such as JOOP!, Hugo Boss, Kenzo, Esprit and Camel, FALKE can also rely on the second pillar of foreign production. In the markets of consumer goods, it competes with following European textile manufacturers on the same markets for the same clientele: Burlington, Calida, DIM, Golden Lady, Huber, Kunert Group, Palmers, Schiesser, Triumph and Wolford. The enlargement of the product range to menswear and ladies bodies enabled FALKE to differentiate from the strongest competitors mentioned above and to find its own niches. [...]