17.01.
2020
Doina Bega, Osadcii Marionela
EMREI 181
About the company
◦ IUVAS company activates in the light industry field since February 24,
1998.
◦ It is one of the most famous knitting companies in Moldova. It is
characterized by the great quality of articles, technical equipment of the
enterprise, promptness in execution and an affordable price.
◦ It is located in the industrial area of Chisinau, Ciocana sector, Mesterul
Manole str. 9.
The assortment of IUVAS includes
◦ linen products (briefs, boxers, swimsuits, T-shirts, fittings, pajamas, body essentials)
outer products (trainers, jackets, pants, sweaters, vests, dresses, skirts, T-shirts)
The articles produced here are made of high quality raw material (knit from cotton) Knitted cloth is
delivered from abroad (Italy, Turkey, Bangladesh).
Presentation of the products: folded in the bag or on individual hangers. Each product has the label
(model no., Size, quality), emblems (company logo, knit composition, operating conditions).
Quality requirements
◦ The team of experienced designers who create, models suitable for any season or age.
◦ Clothes only made from high quality natural fabrics that allow the body to breathe and feel free.
◦ A good product for the consumer.
◦ Flexible price for each citizen from our Country.
At present, the company manages to satisfy the demand of the clients both with qualitative garments as
well as a wide range of products starting from underwear and ending with outer knitwear, which are
intended for men, women and children.
Why going abroad?
◦ Companies go international for a variety of reasons. In general, companies go international because they
want to grow or expand operations.
◦ More specific motives include generating more revenue, competing for new sales, investment
opportunities, diversifying, reducing costs and recruiting new talent.
◦ Going international is a strategy that is influenced by a variety of factors and is typically implemented
over time.
Anticipating risks and barriers:
◦ Trends in the fashion industry are fickle, ever-changing and often elusive;
◦ Clothing models should be tailored to the preferences of foreign citizens;
◦ Market competition with local brands;
◦ The brand can make suspicions because it is not known by the buyers;
◦ Changing taste and preferences of buyers is another risk.
Arguments why starting the business on international market
◦ The clothes are made of natural fabric, a fact that is appreciated in foreign countries ;
◦ Allowing the brand to expand internationally;
◦ Selling the goods at a higher price.
Switzerland
◦ The economy of Switzerland is one of the world's most advanced free market economies.
◦ The service sector has come to play a significant economic role, particularly the Swiss banking
industry and tourism.
◦ The economy of Switzerland ranks first in the world in the 2015 Global Innovation Index and the
2017 Global Competitiveness Report.
◦ According to United Nations data for 2016, Switzerland is the third richest landlocked country in the
world after Liechtenstein and Luxembourg, and together with the latter and Norway the only three
countries in the world with a GDP per capita above US$70,000 that are neither island
nations nor ministates.
Economic Overview
◦ Switzerland has an efficient market economy. Its standard of living, industrial productivity and quality of
education and health care systems are among the highest in Europe.
◦ The Swiss economy performed well in 2018 (3% according to IMF) especially in the first six months
due to a boost to investment and net exports from the tailwind of strong external demand, together with
faster expansion of household spending, but contracted unexpectedly in the third quarter, hit by weak
domestic consumption and an economic downturn in Germany, its biggest trading partner. Growth is
expected to slow to 1.8% in 2019 and 1.7% in 2020.
Exports and Imports
◦ Switzerland's 2011 exports at $308.3 billion and the 2010 exports at $258.5 billion.
◦ Imports are estimated to be $299.6 billion in 2011 and $246.2 billion in 2010.
◦ According to the World Factbook numbers, Switzerland is the 20th largest exporter and the 18th largest
importer.
◦ Summary With a population of 7.5 million people and one of the highest per capita GDPs in the world,
Switzerland is a small but, nevertheless, attractive market for clothing companies.
◦ Switzerland is located in the heart of Europe, among the fashion capitals of Paris, Milan and London, the
Swiss can be considered fashion conscious. All major apparel brands are represented on the Swiss
market.
Business environment
◦ Switzerland is a great business location due to the business – friendly legislation, financial and political
stability, first class infrastructure and highly trained workforce.
◦ Foreign companies can set up and register a Swiss office in a relatively short period of time, ranging
from two to four weeks.
◦ Tax laws, work permits and costs of facilities and for newly formed companies may vary from canton to
canton.
◦ Several Swiss cantons offer investment incentives for foreign companies. Commercial enterprises must
register with the Swiss commercial register.
Hofstede’s values:
*POWER DISTANCE
◦ At 34, Switzerland sits in the lower rankings of PDI – i.e. a society that believes that inequalities
amongst people should be minimized. This means that the following characterizes the German Swiss
style: Being independent, hierarchy for convenience only, equal rights, superiors accessible, coaching
leader, management facilitates and empowers. Power is decentralized and managers count on the
experience of their team members. Employees expect to be consulted. Control is disliked and attitude
towards managers are informal and on first name basis. Communication is direct and participative.
◦ On this dimension, there is a vast difference with the French speaking part of Switzerland, which scores
higher in PDI (very similar to France), which means that people accept a hierarchical order in which
everybody has a place and which needs no further justification. Hierarchy in an organisation is seen as
reflecting inherent inequalities, centralization is popular, subordinates expect to be told what to do and
the ideal boss is a benevolent autocrat. Challenges to the leadership are not well-received.
*INDIVIDUALISM
◦ Both German and French speaking Switzerland score relatively high on this dimension, giving
Switzerland a score of 68, and it is therefore considered an Individualist society. This means there is a
high preference for a loosely-knit social framework in which individuals are expected to take care of
themselves and their immediate families only.
◦ In Individualist societies offence causes guilt and a loss of self-esteem, the employer/employee
relationship is a contract based on mutual advantage, hiring and promotion decisions are supposed to be
based on merit only, management is the management of individuals.
*MASCULINITY
◦ Switzerland scores 70 in this dimension, with both rankings for German speaking Switzerland and the
French speaking of the country indicating a Masculine society – highly success oriented and driven,
albeit that in the German speaking part the impact is much more noticeable.
◦ In Masculine countries, people “live in order to work”, managers are expected to be decisive, and the
emphasis is on equity, competition and performance. Conflicts are resolved by fighting them out.
*UNCERTAINTY AVOIDANCE
◦ Switzerland scores 58 in UAI, perhaps reflecting the difference between the French and German parts.
French speaking Switzerland has a strong preference for avoiding uncertainty while German speaking
Switzerland scores lower. Countries exhibiting high Uncertainty Avoidance maintain rigid codes of belief
and behaviour and are intolerant of unorthodox behaviour and ideas.
◦ In these cultures there is an emotional need for rules (even if the rules never seem to work) time is
money, people have an inner urge to be busy and work hard, precision and punctuality are the norm,
innovation may be resisted, security is an important element in individual motivation. Decisions are
taken after careful analysis of all available information.
* LONG TERM ORIENTATION
**Indulgence
◦ *With a high score of 74, Swiss culture is definitely pragmatic. In societies with a pragmatic orientation,
people believe that truth depends very much on situation, context and time. They show an ability to adapt
traditions easily to changed conditions, a strong propensity to save and invest. thriftiness and
perseverance in achieving results.
◦ **Switzerland scores high in this dimension, its score of 66 indicates that the culture is one of
Indulgence. People in societies classified by a high score in Indulgence generally exhibit a willingness to
realise their impulses and desires with regard to enjoying life and having fun. They possess a positive
attitude and have a tendency towards optimism. In addition, they place a higher degree of importance on
leisure time, act as they please and spend money as they wish.
Brazil
◦ Brazil is the largest country in South America. Following the United States, it is the second largest
economy in the Western Hemisphere, and the eighth fastest-growing source of Foreign Direct Investment
(FDI) in the United States in 2017, according to SelectUSA, the USG's investment promotion program.
◦ U.S. FDI in Brazil (stock) was $68.3 billion in 2017, a 2.8 percent increase from 2016. U.S. direct
investment in Brazil is led by manufacturing, finance and insurance, and mining.
◦ According to the United Nations Council on Trade and Development World Investment Report 2018,
global FDI destined to South America increased by 10 percent as recessions in the two leading South
American economies, Argentina and Brazil, ended.
◦ Considered the eighth-largest economy in the world and the largest in Latin America, Brazil is one of the
leading economic figures in the region.
◦ In 2018, Brazil’s GDP reached US$3.365 trillion, and according to the International Monetary Fund
(IMF) the country’s GDP is expected to increase by 1% in 2019.
◦ Brazil is considered one of the most attractive countries for foreign investors in Latin America.
◦ This attractiveness is due to the size of its domestic market (211 million inhabitants), its wealth of raw
materials, and its economic diversification.
◦ We look at the latest trends in foreign direct investment in Brazil.
Direct Exporting
◦ Direct exporting, in general, avoid all the costs and confusion of a "middleman."
◦ It also allows you to have greater control over sales and to interact directly with your clients.
◦ You have a greater degree of control over all aspects of the transaction.
◦ You know your customers.
◦ Your customers know you, and thus feel more secure in doing business directly with you.
◦ You present yourself as fully committed and engaged in the export process.
◦ You develop a better understanding of the marketplace.
• With improving economic performance of the country,
people are projected to spend more on luxury items.
• Populace is more inclined towards spending on fashion
influenced apparels.
• Changing consumer preferences towards latest fashions are
poised to provide growth opportunities for market
expansion over the forecast period.
◦ Brazil’s young population (falling under the age of 29 years) accounted for more than 60.0% of the total
population of the country.
◦ Growing number of young population in the country is anticipated to have more demand for clothing and
fashionable accessories through 2025.
◦ Increasing consumer spending on clothing and fashionable accessories is supported by rising income of
the population
◦ Brazil’s strong clothing imports, high spending of people on apparel items, and shifting consumer
preferences towards latest fashion are rendering Brazil a prominent destination for manufacturers and
retailers of the apparel industry.
◦ Moreover, the status of Brazil being one of the top exporters of finest quality apparels and textile has
worked in favour of the Brazil apparel market.
Imports
◦ Not only the cost of production is a deterrent; the competition with imported items helped put the
Brazilian fashion market in crisis in 2012 and 2013.
◦ There was an increase of 19.6% in the import of products, especially Asian ones, mainly Chinese.
◦ Abit claims that Chinaallowed its currency a 30% devaluation in comparison to Brazil’s on purpose, and
remember the Chinese have over 27 subsidies from the government in order to produce.
◦ Other problems faced by the Brazilian industry are the obsolete machines available and the high cost of
work force, which makes the competitiveness decrease. Even the luxury items are affected, since the
imported products arrive in the country at cheaper costs in comparison to the national items.
Hofstede’s values
*POWER DISTANCE
◦ With a score of 69, Brazil reflects a society that believes hierarchy should be respected and inequalities
amongst people are acceptable. The different distribution of power justifies the fact that power holders
have more benefits than the less powerful in society.
◦ In Brazil it is important to show respect to the elderly (and children take care for their elderly parents). In
companies there is one boss who takes complete responsibility. Status symbols of power are very
important in order to indicate social position and “communicate” the respect that could be shown.
*INDIVIDUALISM
◦ Brazil has a score of 38 which means that in this country people from birth onwards are integrated into
strong, cohesive groups (especially represented by the extended family; including uncles, aunts,
grandparents and cousins) which continues protecting its members in exchange for loyalty.
◦ This is an important aspect in the working environment too, where for instance an older and powerful
member of a family is expected to “help” a younger nephew to be hired for a job in his own company. In
business it is important to build up trustworthy and long lasting relationships: a meeting usually starts
with general conversations in order to get to know each other before doing business. The preferred
communication style is context-rich, so people will often speak profusely and write in an elaborate
fashion.
* MASCULINITY
**UNCERTAINTY AVOIDANCE
◦ * Brazil scores 49, a very intermediate score on this dimension.
◦ ** At 76 Brazil scores high on UAI – and so do the majority of Latin American countries. These societies
show a strong need for rules and elaborate legal systems in order to structure life. The individual’s need
to obey these laws, however, is weak. If rules however cannot be kept, additional rules are dictated. In
Brazil, as in all high Uncertainty Avoidance societies, bureaucracy, laws and rules are very important to
make the world a safer place to live in. Brazilians need to have good and relaxing moments in their
everyday life, chatting with colleagues, enjoying a long meal or dancing with guests and friends. Due to
their high score in this dimension Brazilians are very passionate and demonstrative people: emotions are
easily shown in their body language.
*LONG TERM ORIENTATION
**INDULGENCE
◦ *At 44, Brazil scores as intermediate in this dimension.
◦ **Brazil’s high score of 59 marks it as an Indulgent society. People in societies classified by a high score
in Indulgence generally exhibit a willingness to realise their impulses and desires with regard to enjoying
life and having fun. They possess a positive attitude and have a tendency towards optimism. In addition,
they place a higher degree of importance on leisure time, act as they please and spend money as they
wish.
How to promote?
◦ * Ask influencers to shar our product;
◦ * Take it to Facebook live;
◦ * Create an account on Instagram, and organize Giveaway ;
◦ * Advertising in social- media;
◦ * Offering quantity discount;
◦ * Publicity .
Product strategy
◦ Design: We chose the most attractive product design to have more customers towards our product. It shows the comfort
and quality of these clothes.
◦ Features: ,,Marketing is not about providing products or services, it is essentially about providing changing benefits to
the changing needs and demands of the customer“ So, we have chosen a special brand, which is associated with the
comfort and warmth of the home.
◦ Quality: For mentain the firm’s reputation and satisfy buyers requirements, product's quality is consistent ,and the
product meets the expectations of target market.
◦ Target Market: Our task is to determine the needs, wants and interests of target markets and to achieve the desired
results more effectively and efficiently than competitors, in a way that preserves or enhances the consumer's or
society's well-being. We opt not only for beauty but also for quality. We are predisposed to satisfy the wishes of all
ages groups.
◦ Positioning: This type of clothes will always be in the top of sales, because of the interesting of buyers. Brazil is a
country where we may sell our product at a better price than in Moldova. The clothes are made of natural fabric, a fact
appreciated in European countries.
Price, costs and income:
◦ The prices will be between $25-$60 in dependence of clothing item. For all of the sales, we will receive +30 % income
for every item.
◦ We chose the Porto Velho city for opening the shop. It’s the capital of Rondonia state(RO) ,Brazil. > population= 428.527
It result that about 2% from the whole population will by clothes for $30 per month.
$40(sale)+ 12(it’s income for $40) * 2% of 428.527 = $8570,50 per month.
Expenses for rent = $900 per month
Public service= $450 per month
State tax = 2 % of income
Sallers’ salaries= $1500 in total
So, $8570,50 - $900- $450 - $1500 =5720,50
State tax = $ 114,41
