Retail Marketing

Retail Marketing

Introduction

The retail company we are discussing here is J Sainsbury. It is the third largest supermarkets chain in UK. Internationalization of retailing firms has received an increasing attention from researchers in recent years. We focus here on the market selection and competitive advantages of retail operations in international markets motives behind international retail activity and matching/networking. However, focus on developed country firms and there is the lack of research on retail internationalization of the emerging market firms.

J Sainsbury and other country firms differ from each other in terms of structure and strategies employed in international markets. J Sainsbury is at an early stage of internationalization with exporting being the dominant mode of market entry. Even it is smaller and has less experience, resources, international reputation, brands and access to distribution channels, enjoy the advantages of low labour and production costs. Thus, it is found to be competing on price rather than differentiation in international operations, and enjoy lower returns. Some research show that some J Sainsbury proved to be quite successful in international markets. The retail sector has become international in its operations. It is quite challenging and complex especially when manufacturing departments are concerned.

First, the information generated by users in general terms and that generated by the company in particular allows more direct, precise knowledge of consumers and facilitates adaptation to new cultural environments. Secondly, communication through these applications is direct and specific, also allowing the consumer to be included in the generation process and, when this occurs adaptation of the product supplied to the, new multicultural environments in which the company works.

Internalization of J Sainsbury

Emerging markets are assuming an important position in today's international strategy research. The adoption of developed nation-based theories or approaches to emerging markets and firms is the challenge in this stream of research strategies that had sprung from advanced countries do not always work as effectively as expected in emerging markets. Moreover, J Sainsbury does not always follow the path of the multinational companies (Macs) in international arenas.

Developed nations are characterized as mature, saturated, and highly competitive. Whereas, J Sainsbury has unique characteristics such as weak and shallow home country advantage, weak institutional structures, political instabilities, and lack of market-based management skills.

Earlier research on internationalization of J Sainsbury has underlined the cost advantages as specific advantages that facilitate its internationalization. This perspective was in line with the mainstream theory, which holds that a firm has to enjoy ownership, location or internalization (OLI) advantages that motivate internationalization.

A rival approach to this was mentioned in the latecomer theory, which viewed the J Sainsbury internationalization as a means of addressing competitive disadvantages such as protectionism, limited access to capital, lack of developed intellectual property rights, limited resources, poor local infrastructure or fierce multinational competition in local markets constraints and restrictions in the local environment have pushed the J Sainsbury towards internationalization. Active government involvement and promotion, which was not discussed in mainstream approach, were also considered being an influencing factor for this company's ...