W Company is a fashion retailer which designs and sells its own brand of women's clothes...

 

Transcribed Image Text:

W Company is a fashion retailer which designs and sells its own brand of women's clothes through its chain of shops in F country. The firm is now facing tough operating conditions in its home market where there is very strong competition resulting in little opportunity for future growth. The Board of Directors of the firm has taken the strategic decision that expansion can only be achieved through market development abroad. Initial research has identified L country as offering the potential to be a possible suitable location for W Company to develop a new market. Further information now needs to be collected on the external environment and competition in L country in order to help evaluate the viability of the strategy being proposed. If the outcomes from the research are positive, W Company intends to find an existing retail chain in L country that it can acquire, rather than set up a new operation through internal development. A senior management team will be sent from W Company to manage the operations in L country. However, the Directors are aware that this could create challenges for the managers if there are cultural differences between the two countries. Questions . 1) Do you think that the decision to acquire an existing retail chain is a sound idea? Yes or No 2) Why? Explain with your rationale. . 3) Explain the relevancy of agency theory in your answer. 4) Now assume the company will go ahead and acquire the retail chain. Discuss the concept of control and suggest the specific management controls and how they would be applied for the W Company is a fashion retailer which designs and sells its own brand of women's clothes through its chain of shops in F country. The firm is now facing tough operating conditions in its home market where there is very strong competition resulting in little opportunity for future growth. The Board of Directors of the firm has taken the strategic decision that expansion can only be achieved through market development abroad. Initial research has identified L country as offering the potential to be a possible suitable location for W Company to develop a new market. Further information now needs to be collected on the external environment and competition in L country in order to help evaluate the viability of the strategy being proposed. If the outcomes from the research are positive, W Company intends to find an existing retail chain in L country that it can acquire, rather than set up a new operation through internal development. A senior management team will be sent from W Company to manage the operations in L country. However, the Directors are aware that this could create challenges for the managers if there are cultural differences between the two countries. Questions . 1) Do you think that the decision to acquire an existing retail chain is a sound idea? Yes or No 2) Why? Explain with your rationale. . 3) Explain the relevancy of agency theory in your answer. 4) Now assume the company will go ahead and acquire the retail chain. Discuss the concept of control and suggest the specific management controls and how they would be applied for the

Answer rating: 100% (QA)

The image displays a text passage explaining a scenario involving W Company a fashion retailer dealing in womens clothing which is considering expanding into L country by acquiring an existing retail ... View the full answer