Business Studies
Countertrade Schemes
Countertrade schemes allow the exchange of products and services for other products and services. A firm can use countertrade schemes to transact with other entities with limited access to cash resources to exchange products and services with companies in other nations (Akhile 279). The schemes are used as import and export strategies to ensure companies with little local resources have access to the required products. In such a case, an exporting entity can offer its products and offerings in a bigger global market, and resultantly, it is likely to realize significant export revenue. However, the exchange may leave the entity worse off since there is no common measure of value. In addition, the entity will find it hard to store value since the commodities may become obsolete.
Advice
The decision to offer quality, premium-priced, stylish clothing to the international markets requires a careful examination of the pros and cons of the move. The pros should exceed the cons to ensure the expansion is viable (Cuyvers and Viviers 102). The next step involves identifying the clothing products with export potential. The organization should carry out market research to identify the needs of the international market. In effect, the research will allow the entity to know how to tailor its products to suit the needs of the foreign target market. The business should also determine its export readiness before it begins the export business. Nonetheless, the enterprise should identify and list the competitive advantages of its products over those of the local and international businesses serving the target export market. Industry analysis should also be carried out by determining the future growth rate of the industry in the global market.
Alibaba’s Potential
Alibaba can realize one trillion dollars in sales and serve more than two billion individuals worldwide. The Chinese company is the biggest e-commerce globally, and it is leveraging its wide reach and many resources for continuous growth. The brand operates in 190 countries, and given the huge success it has enjoyed in expanding globally, it has mastered the global expansion strategy. For this reason, the entity, through continuous distribution and widespread awareness, can sell its wide variety of offerings to new customers in new markets. In effect, the increase in its operations will make the e-commerce leader realize its projective revenues and customer base.
Global Strategy
The global strategy of the Chinese e-commerce company is viable. Alibaba operates in almost all countries globally, and its global expansion can only take place through the increase in new offerings. It can begin implementing this strategy at home by allowing the non-Chinese sellers to offer their products to Chinese consumers. In effect, this move will expand the client base of the entity since it will gain new clients willing to try foreign products. The move to offer Chinese products to other markets is feasible since the entity will offer different offerings as compared to those of domestic competitors.
Supply Chain
The supply chains of the Chinese company cannot continue to facilitate the rise in demand for the entity’s products. The increase in customer orders from various locations globally, coupled with the fact that there are many product selections, stretches the supply chain of the entity to the maximum. The entity can only increase the investments in its supply chain.