Pepsi's Entry Into India - a Lesson in Globalization

International Economics Assignment| Case Pepsis compliance Into India A Lesson in Globalization| Ankur Sikka PGDM IBRoll No. 007| ANSWER 1. A. invite FOR GLOBALIZATION Depending on the strategy that a familiarity follows, there be three primary reasons a company like Pepsi engages in international business: 1. To Increase sales/ Sales Expansion a. Economies of Scale A company like Pepsi usually operates on the principle of Economies of Scale. In localise to achieve a larger market try and operate on this minimum efficient scale of operation, it is rattling essential that the company covers more market and potential customers by moving from a saturated market to an unsaturated one. (E.g. Pepsi shifted its contract from saturated U.S. market to nascent Indian market in order to expand) b. To leverage International Product lifecycle A merchandise in one country maybe at a different phase of its lifecycle in an separate country and this oddment can be exploited by a company to direct their product supply to a more expecting market. (E.g. Pepsi looked at the extremely low per capita consumption of soft drinks as a great opportunity to create a new egress phase for its soft drinks rather than exploiting the mature markets in other countries) 2. To acquire resources a.

Companies like Pepsi need a lot or resources at land cost in order to stool more profitability while keeping up with the demand for raw materials. These companies thus target those countries which can provide the production, filiation or cultivation of these resources at a much lower cost than the current ones (in operation) with minimal tariffs and other barriers. b. This also helps them to assure materials and components from other countries in case if sourcing from one country is in earnest affected due to certain reasons, thus allowing global sourcing. 3. cut back Risk c. Most of these companies tend to diversify when entering other countries in order to... If you want to get a full essay, order it on our website: Orderessay

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