Kuldeep answered on Aug 31 2020
Market Entry Strategy
Market Entry Strategy
Analysis of Risks and Opportunities 2
South Africa 2
Selected Destination 7
Justification of proposed choice 7
Market Entry Strategies 9
The pharmaceutical business has taken over globally. Most advanced countries, for example, India, South Africa and China, have entered into Western medical business, have abandoned traditional treatments as well as taken up the whole Western medicine. These have given pharmaceutical companies huge benefits because they have made a lot of profit from these advanced or developing countries. Most of the businesses have expanded to these countries because they are more profitable, have a huge population and they are international
ands, they are also more likely to increase the faith of their customers (Church, 2016).
Analysis of Risks and Opportunities
Political and Government factor: Africa is not a unified market, but it has 54 different markets. There is a huge gap between the countries in the terms of growth trajectory, market size, legal structure, macroeconomic structure moreover political complexity. In the past decades, ten countries have delivered two-third of Africa’s Gross Domestic Product and cumulative growth.1 Nevertheless; most of the opportunities are not at the national level but at the cities also. In the parts of Africa, the distribution and supply mechanisms are still present challenges: a
angements are evolving, transportation as well as logistics infrastructure is incomplete, and delivery times may be lengthy (Davari, Walley and Haycox, 2011).
Market factors: Manufacturing medicines and other products: It seems to be largest opportunity that most of the foreign pharmaceutical industries can have in the future. The drugs or medicines supplied to South Africa are mainly from India or China, but many other industries have recently entered, because market of South Africa’s pharmaceutical industry is huge and lots of international
ands can easily grab large number of customers in South Africa (Davari, Walley and Haycox, 2011). The pharmaceutical industry must be ca
ied out within Africa, however because the government is eager to spend many money or get many assistance from the foreign donors, business will become a most profitable businesses on the market.
Human resource factors: Expanding the u
an population: The u
an population in Africa is constantly expanding and this does not seem to stop. Since most u
an residents earn more than rural residents, South Africa has higher demand for quality medicines and medicines than other countries. About 11,000 babies are born in Nigeria every day. Like other countries, South Africa’s population is growing at an unprecedented rate and lacks sufficient medicines for people to use. This is another opportunity for pharmaceutical companies to expand into South Africa.
Profit retention factors: The pharmaceutical industry in Africa has grown rapidly over the years. From 2003 to 2013, it jumped from $430 million to $2 billion in profits (Hafeez and Akbar, 2015). By the end of 2020, the market is expected to be worth about $6.5 billion. This is because the country has many opportunities.
Infrastructure factor: International pharmaceutical companies require local business partner - manufacturers, distributors and packaging companies - help them to grow in many markets across the continent, with different customer preferences, manufacturing, price points moreover distribution infrastructure. It is equally important to have a partnership with the government, whether it is to work with medical ideal leaders to guide explore priorities and access to funding, and to work with the Ministry of Health or NGOs to provided public awareness activities, treatments, equipment, health checks and training (Hunter, 2007).
Economic factor: Traditional treatments: Like most advanced countries, South Africa invests much money for medical care. However, most poor people living in the villages and they do not easily get these western medicines. It means that they adhere to traditional forms of treatment. This may lead to huge losses for pharmaceutical industry (Mosikari, 2013). For example, in case of dia
hoea, if traditional he
s can produce the same effect, people may be reluctant to buy Western medicine. This will result in millions of losses and is biggest risk. The African population is undergoing tremendous changes.
Legal and regulatory factor: The country's pharmaceutical laws are constantly changing as each new power change in the country. This makes the law very unclear about intellectual property rules (To
e and Albericio, 2017). A few years ago, the law favoured the use of generic drugs, which led to problems within the state and government. However, due to lo
ying, the law was quickly overturned and many large pharmaceutical companies flocked to take over the country's huge pharmaceutical market (Mosikari, 2013). However, these laws are still unstable and this should be considered a huge risk.
Political and Government factor: Innovative distribution channels and the ability to build effective operations in this challenging environment are critical to catch growth or development opportunities. In key areas of customs as well as border control, the companies must work with most decent agents to decrease shipping delays, utilize and only a bonded distribution centre, and make sure that every customs paperwork are impenetrable.
Market factors: China is also a major competitor to foreign expansion. In 2017, China's pharmaceutical market value was nearly $14.4 billion. By 2022, the estimated value is more than $17.5 billion. There are many opportunities and risks to keep up with the Chinese market (Sendyona, 2014). China is one of the most popular countries in the globe and has the longest duration. It means that the organization's...