Archives
Book Review
International Retailing Plans and Strategies in Asia
John Dawson and Jung-Hee Lee (eds)
ISBN: 978-0-789028-89-1 2004 International Business Press
Noel Tracey
School of Management, Queensland University of Technology, QLD
This book provides a much needed insight into the complexities and difficulties faced by traditional retailers in their quest for growth through expansion into non-traditional markets. Through a selection of case studies, 'International Retailing Plans and Strategies in Asia', provides an interesting and thoughtful view of the many factors that plague international retailers as they enter new markets, specifically, the growing Asian markets. The volume highlights the need to acknowledge, for example, the various cultural idiosyncrasies found within Asian nations and the innate difficulties found in supply chain management within nations that may have limited telecommunications and road infrastructure.
The central theme of the book focuses on how foreign retailers learn to adapt to Asian markets and the ability of these organisations to recognise that different nations within Asia have different cultural beliefs, customs, and infrastructure. This central tenant is extrapolated in order to identify a number of intricacies that entrants into new markets need to be cognisant of. These cases are very interesting in that they identify: three generic hurdles faced by foreign companies; a need for new entrants to learn from their mistakes, and suggests potential reasons why these organisations fail to learn from earlier experiences.
Another interesting case, by Nobukazu Azuma, considers the issues of imitation, innovation and competition within the Asian fashion industry, within the contexts of market orientation and supply chain management. One point of particular significance within the case is the observation that in much of the literature relating to market orientation, only the single organisation is considered. Ultimately, Azuma identifies that supply chains within Asia have similar goals to that of other supply chains in that it too must aim to deliver the, 'wanted style at the right time in the right place, with required variety and affordability and more room for customisation'. This case develops an understanding of the dynamism required in the retail fashion industry if retailers within Asian markets are to harness the benefits from integrated supply chain management, through both imitation and innovation.
The case by Dawson on page 73 considers the level and nature of restructuring within the European retail industry and how this affects retailing within Asian economies. The research is comprised of a number of main areas including an introduction to the role of retailing and the implications of change facing the European industry. The issue of culture is considered from both a consumer and management perspective and demonstrates the inter-relationships between many complex aspects of local management and consumer market culture. In concluding, Dawson succinctly explains the main findings, and reasoning for the increasing focus on 'experience innovation' as opposed to traditional innovation.
Another case relating to Japanese retailing is that by Roy Larke. He considers the moves of a number of Japanese retailers in their efforts to enter other Asian markets, in particular, China. Given the size of the market and the apparent level of expansion by Japanese retailers this study concludes by highlighting three distinct phases in the Japanese expansion into Asian markets. These phases resemble those discussed earlier by Dawson in relation to the European market and lend credibility to both arguments and help to remind the reader of one of the books themes, the ever increasing expansion in to Asia by traditional retailers needs to consider cultural differences.
The next case is quite short (eleven pages) titled, 'The Effects of Liberalisation in Retail Markets on Economy and Retail Industry in Korea' and looks at the expected results from liberalisation of markets within Korea and suggests that these were not as positive as expected. Lee and Choi highlight that since 1996 and liberalisation of the Korean retail market, that new forms of retailing have been introduced and the scale of the retailers has also increased. They go on to conclude that the results in terms of consumer price change and sales per unit of space were below expectations and that the Korean market still has significant potential to grow further as a result of the higher productivity gained from liberalisation. This case allows the reader to develop an understanding of market orientation in a rapidly changing and dynamic consumer environment, thereby linking well with the other cases included in this book.
Schmekel's case considers three main areas, namely: the attractiveness of Asia as an investment market, a review of countries that are particularly suited to foreign investment, and finally, how an overall internationalisation strategy may change once entry into an Asian market is implemented. The paper highlights how market entry into an Asian country can impact on overall internationalisation strategy and that once the decision has been made that any standardised offer must be adapted to suit individual national markets, rather than the approach taken in most western nations.
Another particularly interesting case investigates the need for gradual strategic change by global retailers, Toys 'R' Us and Carrefour in Japan. This paper provides more examples of how global retailers standardise-adapt their offer to the particular market. Baek suggests that best-practice from the home market is exported to a 'pilot' store, which subject to adaptation and standardisation within the new market, generates basic competencies for future locations within that market. This case again reinforces the general theme, in that it is integral for new ventures in non-traditional markets to consider and adapt to local culture and customs.
Of the final two cases, the first considers the issues of distribution within the Japanese market while the second investigates the need to review research initiatives that provide consumer intelligence as western retailers become entrenched in new markets. The first case investigates Japanese distribution systems and the difficulties for international retailers who wish to develop direct links with manufactures and producers similar to the approach found in western nations. The final case takes the concept for the 'format' of operations and suggests new research initiatives that consider changes in the store image and operations of western retailers as they become established in Asian markets.
Overall, this book was quite appealing. It provides an insight into the complexities and difficulties inherent in expansion into non-traditional markets. The cases, while focused predominantly on Japan and Korea, highlight these complexities from a number of perspectives including behavioural and relationship considerations, to branding and supply chain management strategies. Of particular note are the cases by Dawson, Schmekel and Baek as they link well and reinforce the initial theme of the volume. The final cases round out the book well by again supplying current examples of supply chain difficulties within Japan and how research on consumer needs is conducted and used to adapt strategy to new markets.
eContent Home
