Action Plan for Market Entry in the United States
Russell and Bromley can focus on the SOSTAC framework, more notable actions, and control when identifying the most effective approaches to entering the U.S. market. Regarding action, the first might consider franchises for several reasons. The first reason is that the U.S. market is unknown to European retailers, and considering the prevailing competition in the developed American market, it would be best to mitigate the risks of failure. Through franchises, the organization can share the risks with the franchisees (Andrews & Shimp, 2017). However, it is noteworthy that even while Russell and Bromley will decide to share this part, it will still be able to promote its brand, slightly enter the market, and expand its presence when necessary, thus ensuring easy setup.
The steps that will be needed to perform can be seen in Figure 1. The expansion will involve researching the market strengths, weaknesses, opportunities, and threats. The next step will be identifying the costs and finding the funding sources for the expansion (Kotler et al., 2019). Then, there will be a necessity to create a business plan for the action, which will be performed and followed by the cooperation of the C-Suite to determine whether there are no gaps in the process. After, the firm will have to obtain the necessary licenses and, finally, look for potential franchisees.
Overall, the process will extend to seven months and involve the finance, legal, and marketing teams, along with the C-Suite members. The finance department will observe the costs and funding of the expansion, the legal team will work on licenses, and the marketing department will work on research. The C-Suite members will help with the business plan and franchisee search.
Control Measures and Performance Evaluation
The company will first have to research the market to collect data. The marketing team will be able to do so by reviewing the data of public competitors. This will illustrate whether the given business cycle will be acceptable for the new market entrance. Public competitors of similar size can serve as benchmarks (Hollensen, 2020).
The next step is to review Russell and Bromley’s financial reports, such as balance sheets, income statements, and cash flow statements. This way, the financial department will understand whether the company is ready to expand now or if it will have to postpone it. Other steps that involve a business plan, C-Suite conferences, and licenses require no external information. Lastly, to find franchisees, C-Suite members can contact those potentially interested in the latest news.
Rationale for Choosing the United States as the New Market
Finally, several factors need to be reviewed when it comes to Porter’s diamond model and why the U.S. market can be lucrative. Regarding demand conditions, the fashion industry experienced an increase in revenues in the last several years, which illustrates a great demand (Panwar et al., 2022). Moreover, Sabirov and colleagues (2021) emphasize that the textile industry becomes more efficient and in demand with advanced manufacturing. As for the factor conditions, the Bureau of Labor Statistics states that employment is predicted to increase by 8.3 million job positions by 2030, which implies stable, qualified labor (Bureau of Labor Statistics, n.d.).
However, as indicated by Kim (2019), the strategy, structure, and rivalry factors show that there is intense competition in the U.S. apparel industry. However, not every retailer offers high-quality and affordable products. Finally, the manufacturing and textile industries are related and supporting industries. Therefore, overall, the U.S. market is suitable for Russell and Bromley.
Reference List
Andrews, J., and Shimp, T. (2017) Advertising, promotion, and other aspects of integrated marketing communications (10th ed.). South West: Cengage Learning.
Hollensen, S. (2020) Global marketing (8th ed.). Harlow: Pearson.
Bureau of Labor Statistics. (n.d.) ‘Employment Projections’, BLS. Web.
Kim, M. (2019) ‘Export competitiveness of India’s textiles and clothing sector in the United States’, Economies, 7(2), p. 47. Web.
Kotler, P., Keller, K., Goodman, M., Brady, M., and Hansen, T. (2019) Marketing management (4th ed.). Harlow: Pearson.
Panwar, R., Pinkse, J., and De Marchi, V. (2022) ‘The future of global supply chains in a post-Covid-19 world.’ California Management Review, 64(2), pp. 5-23. Web.
Sabirov, O. S., Suyunov, Y. B., Aslonov, A. F. O., Subhonov, M. R. O., and Kamilov, A. Q. O. (2021) ‘Improvement of ways to develop the textile industry on the basis of resource-technology’, International Journal of Modern Agriculture, 10(2), pp. 1868-1877. Web.