In: Operations Management
How must American marketers change their packaging for sale in India and Pakistan? How about product size? Would warehouse clubs like Costco and BJ's be successful in this part of the world? Why or why not?
minimum 500 words
The primary role of packaging a product is to contain, protect and preserve a product as well as help in its handling and final presentation. It provides physical protection, agglomeration of small objects into one package for the reason of efficiency and cost effectiveness. Proper packaging also helps in marketing of the product encouraging a potential buyer to buy the product. It also reduces the security risks of the shipment by including authentication seals, RFID tags or electronic article surveillance tags that can be activated by devices at exit points and require specialised tools to deactivate.
American marketers can change their packaging for sale in India and Pakistan as these countries have different climate conditions and handling methods. They should use packaging products that are engineered to protect from stacking pressures,vibrations ,drops,climatic stress or moisture as well as from bending,cutting and compression. Void fill materials can be used to fill the empty spaces around the boxes. Product sizing is a major concern as most individuals don't buy the large sized products in India or Pakistan due to environmental and financial factors. However, for small sized businesses the product sizing shouldn't be a contraint.
Warehouse clubs like Costco and BJ's have a strong market position in US and abroad. They have a strong network of global suppliers which it uses to make direct bulk purchases for domestic and international products. They also provide high quality products at low prices. The level of risk that they would be successful in this part of the world is exacerbated by cultural loyalty, international trade disputes,and the empowerement of customers that comes from easy access to information about corporate practices.
In countries like India or Pakistan the retail market is well established across major cities and doesn't neccesarily looks for new concepts and new interests. However, metro cities have younger pouplation which are open to experience new concepts and have much stronger financial base wherein the demand can be seen.
An inherent risk in international retail expansion is the inability of the retailer to adjust to different socio-cultural environments. Costco or Bj’s would have to adapt to the sensibilities of new consumers else it might lose out on sales and customer retention. They would have to integrate themselves into new markets seamlessly utilizing local suppliers. The other concerns while expanding in India or Pakistan include political instability, economic conditions and regulatory issues, which the company has no control over, but could adversely affect Costco's business. This is a risk that the company would have to bear as it tries to increase its presence in international markets to accelerate growth.
To conclude, warehouse clubs like Costco or BJ's could be successful in this part of the world if they market themselves in the metro cities and adapt themselves according to new customers to increase sales and retain them. They would have also have to involve local people, suppliers to integrate themselves into the market. Warehouse clubs have been successful in the past in international markets if they counted in the above factors while entering the international markets.