Foreign Market Entry and Diversification Essay Example | Topics and Well Written Essays - 1000 words

Foreign Market Entry and Diversification - Essay Example Participation in the hospitality industry is proposed as the appropriate diversification destination for the company as contained in this discussion. This report highlights the details of conducting a diversification plan for the business into a relatively related business line, owing to the growth status of the mainstream business. Justification As illustrated, shifting from the transport portfolio into the hospitality component as proposed for purposes of business congruence in terms of succession of operations demonstrates the logic behind the proposal. Considering the operations standing and status in the American market coupled with the present expansion ambitions across the borders, the hospitality industry appears to support growth as anticipated. The role of business complementarity for the two portfolios is for purposes of soaking up risk exposure and provides nurturing to the developing business in a direct version (Lawton & Weaver, 2009). Due to the demands of a new busine ss line of operations with respect to overseas presence as a long-term diversification concept, providing the nexus in synergies of related business in the complementarity concept augurs well with growth prospects. Similarities of the travel industry and hospitality business in terms of services needed for both private and business packages provide synergies in business operations. Exploiting the nature of opportunities availed by the hospitality industry to the travel component offered by the travel agency line of current operations present upward trajectories in growth projections (Borein, Rowe & Smith 2002). As an illustration, visitors into the City of New York require accommodation, meals, entertainment and leisure products that have traditionally originated from other hospitality businesses with which the company partners. Hospitality component entails venturing into property ownership across the world’s target cities in America, Europe, Middle East and Africa as well a s Asia Pacific to support the business model. Rolling out property ownership pushes the diversification component into a long-term consideration, apart from a few New York City pilot project considerations. Diversification of the hospitality and travel agency components will require a couple of years and extensive property market research across the world. The first foreign market for entry with the new model as deliberated is India, due to the vibrant economic and tourism growth coupled with relatively affordable property transactions. India as an emerging economy in the world today provides excellent attention to investors that provided a lucrative opportunity for business travel for the vast business territory. The centrality of India for Asian markets extending to the Pacific region will facilitate future diversification of the transport component into the sea and luxury travel component involving yacht and cruise ship famous as central regional business lines. Growth supported in the vibrant economy will facilitate entry into Middle East and Africa as other potentially beneficial opportunities (Lovelock && Wirtz, 2009). As expected in certain markets to provide an opportunity for a single functionality, entry with one component will also form part of the expansion and diversification strategy. As an illustrati