Provide a 6 pages analysis while answering the following question: L’Oreal’s Entry in the Chinese Market. Prepare this assignment according to the guidelines found in the APA Style Guide. An abstract is required. Many firms have to cancel their plans for expanding in new markets while others suffer severe damages from the specific initiative. however, expanding internationally remains one of the most important strategic decisions in terms of the benefits for a firm’s performance. L’oreal is one of the most known Fast Moving Consumer Goods (FMCG) worldwide. one of the factors that led to the firm’s development in the global market has been its ability to adapt its operational policies on the local ethics/ principles – referring to the foreign markets in which the firm has entered successfully. The current report focuses on the plan of the firm to enter the Chinese market. its employees have supported the firm’s efforts but issues of communication have appeared. These issues need to be appropriately addressed early in order to avoid severe damages later. The relevant literature has been used in order to highlight the key communication issues related to the efforts of firms to enter the Chinese market. the specific initiative of L’oreal is strategically valuable but need to be appropriately reviewed – taking into consideration current market trends, the similar policies of competitors but also the consumer preferences in the targeted market – these preferences are likely to affect the firm’s performance in the particular market.
The entrance of a firm in a foreign market needs to be developed through a specific methodology – aiming to reduce the risk related to this initiative. In most cases, firms that operate in the international market have the necessary strategic framework in order to face the problems that would be related to such projects (Stanco, 1995, 24). however, there are cases where the local cultural and social characteristics are difficult to be addressed – especially in cases where the targeted market has a different social background compared to the firm’s culture – for instance, Asian markets have different ethics and culture compared to the markets in the West or the markets in the Middle East (Kotler et al., 2008, 35). For this reason the firms that are interested in entering a foreign market need to take into consideration the following issues: a) the support of employees in these projects is critical for the success of the whole effort. if resistance is developed within the organizational environment it is difficult for the firm’s managers to develop the appropriate schemes for the firm’s expansion, i.e. if operational problems in the existing firm’s units need to be resolved no critical projects – like the expansion of the firm in a foreign market – would be developed since the chances for their success would be limited, b) the culture of the firm’s place of origin is important to understand the culture of the target market. however, if major differences exist between the two cultures, then there would be no particular point in using the former (culture of the place of origin) as a basis to develop the policies for entering the foreign culture, c) the existing resources need to be taken into consideration when developing such plans. in fact, the firm’s available resources would be reviewed in advance, i.e. at the planning phase of these projects, d) the similar practices of competitors – especially those that already operate in the targeted market – would be of particular importance in order to identify the strategies that would be appropriate for the specific initiative, e) towards the same direction, the performance of such initiatives in the past would be taken into consideration. through these initiatives it would be possible to identify the potential risks but also to evaluate the chances for success.