While undertaking business operations in a different country, it is imperative to understand the business environment of the country, the legal, cultural and ethical practices, trade policies and exchange rates within the foreign state. Moreover, it is essential to consider the market for the product and how the market may vary. In this regard, this report will examine the business environment in South Korea and analyses how to strategize in engaging in a business opportunity within the given Country.
Business Environment in South Korea
South Korea has about 50 million inhabitants and comprises of almost 3000 islands. South Korea, over time, has developed to become among the wealthiest countries in Asia. The primary reason is that the state has grown its economy over time and became a member of the Organization for Economic Cooperation and Development.According to Noble and Durmusoglu (2015), South Korea is ranked as the third largest country in Asia Economically and fifteenth within the Global Economic Power Countries. When considering the Gross Domestic Product of the country, it is very high and is represented by the international trade within the state. The government of the country protects the economy of the nation and stabilizes the economy of the same in a variety of approaches. These styles used include the use of tax incentives and accommodative monetary policies.
The free trade agreement that the country engaged in on July 2011 has eliminated a total 98% of the overall duties on the imports primarily on agricultural products. The lifting of the free trade agreement helped to ensure more goods were traded between Europe and South Korea. Moreover, the country can sell more products to different countries easily and incurs more profits. The principal products within the state are askedin the automobile industry, consumer electronics, and textiles. The Gross National Product of the country is made up of different products. According to Bushnell, Drucker, Abell and Hammond (2015), the country is efficient in producing soybeans, wheat, sorghum, corn, wheat, semiconductors, car manufacturing, electronics, and other products. The rate of inflation in the country is significantly low at an average of 3.8.
Concerning the legal regulation of the country, the law within South Korea combines two elements involving the European Civil law and Anglo-American Law. The country’s legal system does not have a Jury, but the courts within the country have about 1 to 3 judges who hear the cases. Moreover, the judiciary is composed of highly professional personnel who act independently and fairy. However, the country’s businesses are not free from pressure posed by the government. With regards to corruption, the country has been ranked as 40thregarding transparency within the international corruption perception index that accounts for these statistics in about 200 nations.
Doing business in South Korea requires some business etiquettes to be followed. One of the key cultural aspects that every business must understand is the Confucian influences. These traditions affect how business operations are conducted. According to Saladis and Kerzner (2009), the Koreans have an emphasis on education, respect, and authority. The relationships in most of the institutions within the country are based upon status, age, educational background, position and how well persons are recommended. When in meetings, Koreans expect that time is of the essence and should be considered. Majority of the people within the country expect that their counterparts in meeting arrive at the agreed time, with only a few minutes to spare but not for lateness. Business cards are also important in the business set within the country. However, a key element of importance is the form of greetings. While handshakes are of importance in the business settings, Koreans appreciate the use of bowing to the elderly in greetings as it shows respect. It is expected that juniors initiate the bows, and the seniors accentuate the bow slightly.
Foreign Direct Investment in South Korea decreased in 2009 due to the world’s recession. However, the Foreign Direct Investment in the Country increased again in 2011 with a measured growth of about 4.6% and slowed down a little in 2012. The rising of the Foreign Direct Investment levels is attributed to some elements. One of these factors is the skilled workers in the country who utilize technology and vast research to develop the products sold from the country. Moreover, the country has transparency in the investments made, hence having more of the investors choosing to work with the country. Financially, the country is largely dependent on exports and international trade.
The county’s Participation delivers real benefits in regional economic integration. In addition to the free trade in the country, it is evident that they are on the verge of demonstrating a willingness to be committed to the regional integration, hence proper growth. The value of the United States dollar is significantly large as compared to many other countries. However, the country’s Won equals about 0.00088 United States Dollar. This shows that the country’s value of money is high with regards to global standards.
The product and Strategies to Integrate it in the Country
According to Noble, and Durmusoglu, (2015), different strategies can be used to ensure a product is developed and launched in the foreign market. However, it is essential to understand various elements of the country including the market for the product, the research, and development required, the process and method of production of the product, human resources and the risks involved in entering the market.
The strategy to be used in the process of introducing the product is the market-oriented strategy. The baby bibs are garments worn on the neck that prevents the clothes from being dirty while eating. These collars also prevent the child from getting messy spills on their chest. The strategy will target these consumers and production will be based on the number of customers and market demands. In this regard, there will not be any cases of overproduction, but market demands will be met.
To enter the foreign market, it will be important to first analyses the market and how it operates. According to Basu (2016), there are different strategies that help to understand the market. These strategies include Porter’s Four Forces of the Market, the SWOT Analysis and how the market is aligned. The research will be conducted to understand the risks involved in the market and how the consumers will be aligned to purchasing the products from the company. The approach towards understanding the market will be important since it will assist in ensuring the product is efficiently pitched in the market and therefore, ensure the product will be successful in the market. The competitive nature of the market for the product will also be analyzed to understand how competitive the market is. In this regard, the competition of the market will help to understand how different companies develop their products, the pricing strategy and how to market for the same.
The proposed development approach for the product is through the integration of technology and clothing design. Nanotechnology will be combined with the design of clothing to ensure the development of the bib conforms to the market standards and meets the quality desired by the company. Technology will be used to incorporate and embed microstructures in the baby bibs that are capable of absorbing liquids and molecules at a fast rate. Nanotechnology will be useful in ensuring the developed disposable baby bibs are capable of manipulating the particles of atoms to provide dryness of the garment. According to Saladis, and Kerzner, (2009), the nanotechnology is essential and proper in developing these disposable baby bibs due to their tiny sizes.
The neck section of the disposable baby bib will be designed to have some padding around to give the child ample time to eating without chocking them. However, it is to be filled with a stretching material that is loosely tightened to fit many sizes of the neck of different children, hence targeting a broader segment. An essential aspect of the development strategy of the product will be the design of prototypes to be reviewed, tested and feedback gained from the potential customers. According to Bushnell, Drucker, Abell, and Hammond, (2015), prototypes refer to products which are in design phase that have been developed and meet specific standards of the product to be produced, but lack the final touches and are used to understand how the product will function, their overall outline, and the look and feel of the same. During the stage of production, feedback from consumers is imperative and seeking the same assists in directing the development process towards a proper direction and meeting the needs and requirements of the customers. Moreover, the rapid development of the product will be imperative to ensure the product reaches the intended customers at the fastest time possible. However, quality standards are to be considered in the process.
The product development project will be handled in small bits, with each of these little amounts of work done on the product being tested and evaluated for the effectiveness of the product itself. The production is to be divided into different sections from gathering the raw materials, technology and personnel to work on the product, designing the structure of the baby bibs and otherwise development of the prototype. The prototype will then be availed to the customers to provide their insights on the same and recommend any changes they would feel are essential to the product. Further, from the feedback, the product development will continue.
Distribution of the product will be done through different channels to ensure the same reaches many people within the country. Since the product is small, it will be packaged in different boxes of different sizes. The same will be channeled to the markets targeting the specific persons and customers. The market segments will also be analyzed, and the products channeled in these segments. The promotion of the product will also be done to ensure the product reaches the customers.
The research will be conductedby the customer behaviors and how the product will solve the problems of the target segment. The problem noted in the feeding of children is that they always play while eating. Some of the tender age kids do not like the food, and feeding them is done forcefully. In the process of feeding these babies, it is impossible that the meals will not spill to the kids. Therefore, the introduction of the new product, the disposable baby bibs, will help to solve this particular problem. Two different scenarios are of crucial interest in the solution provided. One so these situations is when children are left home to be fed, or to learn how to feed themselves. In this process, these children will always spill food on their clothes, making them dirty. The pitched product will help to reduce this problem since they will help to prevent meals from dropping on the clothes of the babies. In light of this, mothers of these children will have less laundry to deal with especially if they are busy parents. The persons left with children also will have an ample time feeding the children without having a fear of meals spilling in their clothes and spoiling them.
The human resource policy will be conducted and integrated within the product development and ensure the product is developed effectively. The workers who will be employed to develop the products will be highly skilled, and policies will be integrated towards achieving the objectives of the firm. Moreover, policies directed towards protecting the interests of the workers and hence achieving their needs and meeting their requirements. Finally, exchange rate risks will be managed by developing strategies to understand when the rate is high. Exchanges will be done when the rate is high to ensure maximized profits on the same.
Conclusion
South Korea has about 50 million inhabitants and comprises of almost 3000 islands. South Korea, over time, has developed to become among the wealthiest countries in Asia. The primary reason is that the country has grown its economy over time and became a member of the Organization for Economic Cooperation and Development.With regards to the legal regulation of the country, the law within South Korea combines two elements involving the European Civil law and Anglo-American Law. The proposed development approach for the product is through the integration of technology and clothing design. Nanotechnology will be combined with the design of clothing to ensure the development of the bib conforms to the market standards and meets the quality desired by the company. Distribution of the product will be done through different channels to ensure the same reaches many people within the country. Since the product is small in size, it will be packaged in different boxes of different sizes. The research will be conductedby the customer behaviors and how the product will solve the problems of the target segment. The problem noted in the feeding of children is that they always play while eating. Some of the tender age kids do not like the food, and feeding them is done forcefully.