Our business has been in operation for more than ten years and we have been offering products and services in the United States (home country). The company will have to market groceries and non-groceries products. Currently, the company has an idea of penetrating the EU market and set some chain stores operations. The company will have to penetrate Sweden market. However, Chain stores are highly concentrated in Sweden market but this will not be a hindrance point to our company since we believe in everything that we undertake. The company has been able to set a successful path in the home market.
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This has been achieved due to the use of up to date technologies and innovation capacity. Chain store has been profitable for many years and we have been able to set an appreciable share with additional values that are used in research and development that has been evidenced by the increased number of clients and customers. The company has set an integration pace and it will operate various chains of discount departmental stores and warehouse stores within Sweden. Golden stores Inc is headquartered at Delaware, in the United States (Economides & Tåg, 2012).
Nature of the Company Products
The company will have to set three retailing format that will later be the common marketing place in the European Union region. The company will have to set the discount stores, supercenters and the Golden Markets. The company retailing market will have to sell various differentiated products especially the non-grocery products. Shifting the emphasis on the Supercenter, the company will have to stock more grocery products and it will have to contain the Golden online retailer, golden.com. As well, the store will have to stock and sell the generic drugs at a lower cost when compared to the rivals (Economides & Tåg, 2012).
The company stores will vary in size from an average of 52,000 to almost 200,000 square feet and the average store will have to cover about 102,000 square feet. The stores will have to stock the general merchandise and some selection of grocery. As well, the stores that will be set will have some garden center, a pharmacy, an optical center, portrait studio, bank ATMs and Branches, cell phone stores, fast food restraint and a tire and Lube center.
Golden supercenter will have to store everything in the market and it will have some additional services that are found in a full service supermarket such as poultry, meat, baked foods, frozen foods, dairy products, fresh seafood and delicatessen. As well, there will be hair and nail salons, local bank branches and ATMs, and video rental stores. The Neighborhood Market of the company will have to stock grocery stores and they will be used to fill the gap created in the discount stores and the supercenter. It will have to offer various products that will include the groceries, pharmaceuticals, beauty products, health products, photo developing programs and general merchandise.
The notion of the micro-economic has been in existence in the market and it looks at the reasonable and clear understanding of competitiveness basing it on the aspect of the company to compete, grow and be profitable in the future. At this capacity, the company level will have to take a consideration of being consistent and produce profitable products and services that will meet the demand and the requirements of Sweden market in terms of the price and quality. As a company that is established well in the United State, we believe that we have to meet these requirements for us to remain in the business. This will draw a large competitive advantage to our rivals hence accessing greater ability of gaining the market shares (Roniger, 2004).
The region competitiveness have a degree of operating under free and fair marketing condition that will produce goods and services that will have to set the test made in the international market and expand the real income of the citizens. The competitiveness level of Sweden is based upon the superior productivity performance level of the economy and its ability to shift the level of output and achieve higher levels of real wages (Roniger, 2004). Sweden competitiveness has been based on the higher living standards, expansion employment opportunities and the capability of the region to maintain the international level of obligations. As well, the region has been able to maintain trade equilibrium. As well, the economy factors will have to undertake and consider the open market condition that will make sure that we are able to offer and meet the test of the foreign competition and maintain and expand the domestic real incomes (Duvander, 2001).
Sweden government has set various business regulations that aim at offering protection to the employee’s rights, protection of environment and holding the companies quite accountable for the power level they have for the business driven society. The regulations have been relevant to the Sweden employees and the customers (Roniger, 2004).
Sweden has an established law related to marketing and advertisement that have been set under the Trade Commission. The law has been set with an aim of protecting the consumers and making sure that companies will provide honesty on their products. Each business in Sweden is expected to comply with the set truth advertisement laws and there are chances of facing the law in case of violation. Advertisement and marketing in Sweden must be truthful and non-misleading. As well, the adverts created need to be fair to the consumers and the competitors.
Employment law is among the ever-changing regulations. Sweden has set the law related to employment and it considers aspect of minimum wages, safety, benefits and health compliance standards (Belot & Van Ours, 2001). As well, it considers work for non-Sweden citizens, the working conditions, privacy regulations and the opportunity employment. On the other hand, there are environmental laws that incorporate the aspect of footprint of the business and the environment that is regulated and controlled under the Environmental Protection Agency along with other state agencies. Sweden has an established Environmental Compliance Assistance Guide that helps all businesses to attain the environment compliance standards. As well, the guide assists in educating the business rather than being an enforcer (Casper & Whitley, 2004).
There is an established privacy law in Sweden. During hiring and business transaction, there is collection of sensitive information from the employees and the customers (Casper & Whitley, 2004). The privacy law that is established has been set to prevent all businesses from any disclosure of the valuable information. Some of the vital information that is collected includes the social security number, name, address, credit cards, personal history and bank numbers. Finally, there is safety Act that does ensure that all employers within Sweden have the liability of providing the employees with a safe working environment (Casper & Whitley, 2004). This is achieved by conducting frequent inspections and grading of scale. The company is expected to meet certain standards for it to survive in the business. Most of these regulations have been changing alongside changes on the workplace standards. Employers are expected to provide a hazard free working environment that will avoid staff physical harm (Casper & Whitley, 2004).
Sweden has developed and the process of expansion has been in line with the general performance of the economy. Swedish economy has indicated cautious recovery in the market and there are chances of recovering with an impression to the customers due to achievement of dynamic growth in the retailing markets. There are signs of economic recovery but the consumers in the market are price sensitive and cautious when it comes to purchases. Internet retailing has been a platform that has made it easier for the companies to make a comparison of the prices and shop around to access the best-desired deals. Most of the marketing channels in the market are mature and have been marketed by the stiff prices competition that is noted among the retailers.
Most of the consumers within the market are eager to exploit the opportunities while shopping around to get the best deals, waiting for the special offers and seasonal discount and haggling in the stores. These factors make Sweden market very price competitive (Casper & Whitley, 2004).
Grocery retailing is expected to experience a more dynamic growth rate when compared to non-grocery retailers. The country is experiencing a slow economic recovery and this is not a strong enough situation that can encourage the clients to make any purchases of non-essential items. However, there is expectation of slight changes in the economy and this may give the consumer better ways of managing trade up with more premium groceries. There are discounters and hypermarkets in the country that have remained to be appreciated for their effort to maintain a competitive price range. This indicates that consumers for long have remained cautious on the spending habits and in connection to their grocery purchases (Belot & Van Ours, 2001).
Sweden Political Risks
Political risks in Sweden have been affecting the banking situation. The size of banking and the degree of concentration in Sweden has been vulnerable. As well, the country parliamentary elections that were held in September 2014 were won by the Social-democratic. The country has a new prime minister by the name Stefan Lofven who formed precarious coalition with the Ecologist party plus some other minorities’ parties that brought in divergent ideologies. The center left parties secured 158 seats out of the total 349 seats in the parliament. The center party that had been in power for more than 12 years made the country to suffer a major defeat.
Strength of the Economy
- Sweden economy is open, diversified and competitive.
- It has specialized high technology products with a green economy.
- There are sound public sources of finance.
- There is a tax reduction program.
- There is resilient banking sector.
Weakness of Sweden Economy
- Higher level of youth unemployment.
- Large household debts.
- Aging population.
Tariffs and Taxes in Sweden
There are imposed import duties and taxes that are combined when importing goods into Sweden from outside the EU region by commercial or private firms. Imports duties and taxes that are payable are calculated using the CIF values.
The import rates that are applied in Sweden when importing goods average from 0 percent and 17 per cent. There are some duty free products such as laptops, camera, and the video games.
The standard rate set on importation in Sweden is 25 per cent for products such as the newspapers, and magazines and may be attracted to a reduced rate of 6 per cent. In Sweden VAT is determined and calculated on the values of goods adding up any other international shipping expenses and insurance. There is minimum threshold for exports into Sweden which duty is waived. VAT is always payable in Sweden (Segoviano & Lowe, 2002).
Other Legal Aspect
Both the United States and Sweden are members of World Trade Organization that has been able to be a multilateral organization. WTO has assisted the two countries to remain in peace, better ways of handling conflicts, free trading that cut the cost of living, trade raise the level of income, it stimulates the economy growth, and it encourage good governance.
I would advise the company to seek for IP protection mainly on patent to protect their inventions and this would exclude others from making and selling using the same invention. As well, the company will need to take trademark protection that will protect a word, phrase, design or a symbol that will differentiated the available sources if business from the competitors.
Belot, M., & Van Ours, J. C. (2001). Unemployment and labor market institutions: an empirical analysis. Journal of the Japanese and International Economies, 15(4), 403-418.
Casper, S., & Whitley, R. (2004). Managing competences in entrepreneurial technology firms: a comparative institutional analysis of Germany, Sweden and the UK. Research Policy, 33(1), 89-106.
Duvander, A. Z. E. (2001). Do country-specific skills lead to improved labor market positions? An analysis of unemployment and labor market returns to education among immigrants in Sweden. Work and Occupations, 28(2), 210-233.
Economides, N., & Tåg, J. (2012). Network neutrality on the Internet: A two-sided market analysis. Information Economics and Policy, 24(2), 91-104.
Roniger, L. (2004). Political clientelism, democracy, and market economy. Comparative Politics, 353-375.
Segoviano Basurto, M., & Lowe, P. W. (2002). Internal ratings, the business cycle and capital requirements: some evidence from an emerging market economy.