Table of Contents
- Task 1: International Expansion of RyanAir in India
- External Environment Analysis
- Porter’s Five Forces
- Bargaining Power of Buyers
- Bargaining Power of Suppliers
- Threat of New Entrants
- Threat of Substitutes
- Competition among Existing Players
- Capabilities and Competencies
- Market Entry Strategies
- Mode of Entry
- Conclusion and Recommendations
- Task 2: Critical Analysis
- Positive Aspects
- Negative Aspects
Task 1: International Expansion of RyanAir in India
In the present age of globalisation business organizations are trying to reach out to new markets. The present study would focus upon the market entry strategies of Ryan Air in India. The concentration of conventional markets and rising prospects in emerging markets such as India and China also compelled the company to take this strategic step. The business aims to utilise its new low-cost no-frills approach as part of a low-cost initiative to capture the target market. RyanAir is a UK-based airline corporation founded in 1985 and is now a mammoth enterprise with a fleet strength of 272 aircraft (RyanAir, 2011). RyanAir primarily offers flights to different destinations throughout Europe and is one of the most popular brands in Europe. In order to achieve a market edge, the organisation plans to duplicate its low cost model in India.
External Environment Analysis
PESTEL is a method used to evaluate the environmental atmosphere of a company enterprise. The method analyses the political, fiscal, sociological, technical, environmental and legal facets of a given industry (Kay, 2010, p.23).
PESTEL is a method used to evaluate the environmental atmosphere of a company enterprise. The method analyses the political, fiscal, sociological, technical, environmental and legal facets of a given industry (Kay, 2010, p. 23).Political considerations impacting RyanAir’s commercial interests include the degree of market deregulation, taxation and operating permits. The Government of India is a constitutionally elected and stable government that primarily supports the development of business centres in India. The Directorate-General for Civil Aviation regulates the airline industry in the country. The government has advocated a programme of deregulation that has enabled healthy competition in the business segment in the country (Mazumdar, 2008, p.104). Elections are conducted every five years, offering the country some continuity. Government management is split into administrative, legislative and judicial branches (CIA, 2011).
Economic factors influencing the airline’s market prospects include economic growth rate and other macro-economic data affecting the amount of disposable income of individuals within a country. India has an excellent GDP growth rate of 10.4% as of 2010. In terms of purchasing power parity, GDP stands at 4.06 trillion US dollars, which gives Ryan Air a strong boost to its expansion into India. GDP is around 10.4% per population in terms of wages (CIA, 2011).
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