WordPress.com



Team Semester Project – Disneyland ExpansionDisney’s future expansion – Country optionsSelectionDisney has expanded its theme park operation in 3 continents. For getting more visitors and increasing their business arena, we have identified two potential countries from two unreached continents – Australia and South America. Following two countries are the best options among the remaining countries of the world in terms of different factors (described in later part of our proposal):Country 1 – Australia (From Oceania Continent)Country 2 – Brazil (From South America Continent)General information about the countriesParticularsAustraliaBrazilContinentAustraliaSouth AmericaArea2941300 square miles3287600 square milesArea Rank65Primary Language-PortugueseCurrencyAustralian DollarBrazilian RealGovernment TypeParliamentary DemocracyFederal RepublicUnemployment5.2%5.5%Population below poverty line-21.4%Literacy rate99%90.4%Education index0.9810.674Life expectancy81.98 years73.02 yearsLife expectancy rank (out of 194 countries)592Infant mortality rate4.49 Death (out of 1000 births)19.93 Death (out of 1000 births)Health Index0.980.85Internet usage72%38%(Citation: Country Facts)Reasons for choosing the countries for Disney’s ExpansionAustraliaTourism in Australia: Tourism is one of Australia's biggest export industries, adding more than A$42 billion to the economy in 2013 and directly employing more than half a million people. Tourism is important to both metropolitan and regional communities. In 2013, a record 6.3 million people visited Australia from overseas. Food and wine tourism is expanding, in line with Australia's growing international reputation as a producer of high-quality wines and a supplier of fresh, regionally produced food.Economy: The economy of Australia is one of the largest mixed market economies in the world, with a GDP of US$1.525 trillion as of 2014. In 2012, it was the 12th largest national economy by nominal GDP and the 17th-largest measured by PPP-adjusted GDP. In terms of international trade, Australia is the 19th-largest importer and 19th-largest exporter. (Citation: Wikipedia – Economy of Australia))Power sector: Australia, rich in hydrocarbons and uranium, was the world's second-largest coal exporter in 2012 and the third-largest liquefied natural gas (LNG) exporter in 2013. (Citation: )Theme park culture: Australian culture is multi-cultural and people love to visit theme / amusement parks in their weekend to spend time with the family and children. There are several theme parks in Australia; the biggest is Wet ‘N’ Wild in Gold Coast (around 1.4 million consumer visit every year). Gold Coast, south bay and Queensland are famous for theme / amusement parks and water parks in Australia.BrazilWe have selected Brazil, due to the following reasons:Tourism in Brazil: Tourism in Brazil?is a growing sector and key to the economy. The country had 5.17 million visitors in 2012, ranking in terms of the international tourist arrivals as the second main destination in?South America. Among the most popular destinations are the?Amazon Rainforest,?beaches?and?dunes?in the?Northeast Region, the?Pantanal?in the Center-West Region, beaches at?Rio de Janeiro?and?Santa Catarina.Economic Stability: Brazil's economy outweighs that of all other South American countries, and Brazil is expanding its presence in world markets. Since 2003, Brazil has steadily improved its macroeconomic stability, building up foreign reserves, and reducing its debt profile by shifting its debt burden toward real denominated and domestically held instruments. Brazil's historically high interest rates have made it an attractive destination for foreign investors. Theme park culture: Vibrant and colorful culture of Brazil attracts tourists from the world. Also Brazil is one of the most outgoing theme park visitors of the world. In 2013, approximately 12 million visitors have visited Brazilian theme parks, of which – most are local. Bete Carrero World is the biggest theme park of Latin America, located in Brazil. Power sector: Brazil has the 2nd biggest oil reserves in Latin America and became a net oil producer in 2009. Brazil is ranked 5th in the world for producing minerals and is reported to be one of the world’s biggest markets in mining equipment. It has the biggest electricity market in South America, it has more than twice the combined consumption of Argentina, Bolivia, Chile and Uruguay.(Citation: )Challenge & Risk analysis4.01 LanguageAustralia: According to the 2011 census, 76.8% of people spoke only English at home. Other languages spoken at home included Mandarin 1.6%, Italian 1.4%, Arabic 1.3%, Cantonese 1.2% and Greek 1.2%. Official language is English.Brazil: Official language is Portuguese. Other spoken languages are Spanish, English, French, American Indian languages.(Citation: )4.02 Cultural differences on business operations and practicesAustraliaIn the Australian business world, personal relationships are important. Australians take punctuality seriously and quickly get down to business. Communications needs to be direct, good-humored and to the point. People tend to be pragmatic, efficient, and profit-oriented and appreciate straight-forward, open presentations. Australians often negotiate major issues without over-emphasis on details. A factual description of issues will be far better received than a more hyperbolic approach. They follow strict application of formal rules. Australian business culture is one that works as a whole unit and team rather than working as individuals. The result of gaining every individual’s input is that each individual strives to further the company’s munication is the key to any successful business or meeting. In the Australian business culture, discussions are blunt and to the point. Status or hierarchy is not important while doing the discussion. Preferred communication language is English.(Citation: World Business Culture)Brazil:Brazilians prefer face-to-face meetings as it allows them to know the person. Their culture is group oriented culture. Communication is often informal and does not rely on strict rules of protocol. Brazilians exhibit strong levels of eye contact when speaking to people. They take time when negotiating & often the people you negotiate with will not have decision-making authority. Use of local lawyers and accountants for negotiations is recommended and should be arranged. In Brazil, businesses maintain hierarchy. Business appointments are required and can often be scheduled on short notice – but should be confirmed in written form. Brazilians pride themselves on dressing well. Business cards are exchanged during introductions with everyone at a meeting.English is by no means universally spoken in Brazil and when dealing with people outside the major commercial centers, an ability to speak Brazilian Portuguese is extremely useful. Requirement of translator should be identified before the meeting. (Citation: Kwintessential.co.uk)4.03 Political stabilityAustraliaAustralia is maintaining a stable political environment. The politics of Australia is within the framework of a federal constitutional parliamentary democracy and constitutional monarchy. Australia largely operates as a two-party system, where voting is compulsory. At a national level, elections are held at least once every three years. The most recent Australian federal election took place on 7 September 2013.(Citation: )BrazilThere is currently no major political disruption in Brazil. In general, the elections take place in every 4 years. Last general election took place on 5 October 2014 to elect the President, the National Congress, state governors and state legislatures. Currently there are some political issues in Brazil: The first is widespread discontent with the impunity and corruption of government officials. The second is fatigue with the Workers Party’s (PT) politics and economic policies. Finally, Dilma’s own inability to manage her coalition through Brazil’s slumping economy and evolving corruption scandals was the issue. For all those reasons, there was a mass protest in Brazil on 2013.(Citation: )4.04 Business customs and etiquettesAustraliaShake hands with everyone present upon meeting and before leaving. Allow women to offer their hands first. Use titles, Mr., Mrs., and Miss when first introduced. Australians generally move to a first-name basis quickly. Academic or job-related titles are downplayed. Always arrive on time or a few minutes early for a dinner. Australians follow continental-style dining etiquette. The guest of honor is generally seated to the right of host. Offer to help with meal preparation and clean-up when being entertained in a home. Australians wear fashions similar those worn by Europeans and North Americans For business, men should wear conservative jackets and ties. Women should wear skirts and blouses or dresses. Winking at a woman is considered inappropriate.? Using modest gestures to articulate what you are saying is common.?A firm, friendly handshake is the customary greeting.? Women friends may kiss and hug when greeting each other.? Respect personal space; don’t stand too close to people when talking to them.? Queuing is important—never barge or jump into a line.BrazilMen shake hands when greeting one another, while maintaining steady eye contact. Women generally kiss each other, starting with the left and alternating cheeks. Hugging and backslapping are common greetings among Brazilian friends. If a woman wishes to shake hands with a man, she should extend her hand first.If invited to a Brazilian's house, bring the hostess flowers or a small gift. Orchids are considered a very nice gift, but avoid purple ones. Avoid giving anything purple or black as these are mourning colors. Handkerchiefs are also associated with funerals, so they do not make good gifts. Gifts are opened when received.Brazilians dress with a flair and judge others on their appearance. Casual dress is more formal than in many other countries. Always dress elegantly. If you did not bring a gift to the hostess, flowers the next day are always appreciated.4.05 Availability of suitable consumer market AustraliaThe market is suitable in Australia for expanding Disney’s business. There are number of theme parks / amusement parks and water worlds in Australia, which indicates there is a large potential market for Disney to capture. Following are some major theme/amusement parks of Australia: WetN’Wild (Gold Cost)Warner Bros. Movie World (Gold Coast)Sea World(Gold Coast)Scenic World, Katoomba(New South Wales)Paronella Park (Queensland)Aussie World(Queensland)There are 30+ theme/amusement parks all around Australia. Tourists from New-Zealand often visit the theme parks in Australia, apart from Australian people. The biggest theme park of Australia Wet ‘N’ Wild Gold coast experience around 1.4 million visitors per year (2013). (Citation: aecom.ca)BrazilBrazil is one of the countries, where people love to visit in the theme parks / amusement parks. There are many theme parks in Brazil, most notably are: Hopi Hari (Sao Paulo)Beta Carrero Worl (Santa Catarina)Mirabilandia (Salgadinho)Terra Encantada (Rio de Jeniro)The number of visitors for theme parks in Brazil amounts to around 12 million annually. However, most of the visitors are local. (Citation: Unitedworld-)4.06 Business Openness & Market vibrancy AustraliaAustralia is an open country for foreign direct investment. The avg. FDI in Australia is US $57,000 (million dollars). The country is economically vibrant. However, the country is currently facing economic down turn. Inflation has risen up. Unemployment has increased in Australia. However, other economic indicators are showing good for Australia. The economy is vibrant and open for foreign investment.BrazilBrazil is also an open economy for the foreign investors. It is one of Latin America's most enticing markets, boasting stable mining, manufacturing and agricultural sectors and a dynamic, innovative science and technology industry. Brazilian law gives the same protection and guarantees to foreign capital investments that it gives to investments made by Brazilian nationals. Special incentives are offered for investments in mining, fishing, tourism, shipbuilding, and reforestation and for projects undertaken in the northeast and Amazon regions. Brazilian economy is very much vibrant. DI is US$ 65,000 (million) (Average, from 2012). However – there are several risks in Brazil related to the following: loss of investment grade credit rating, petrobras debt bomb exploding, electric power rationing etc. (Citation: )4.07 Government roles in businessAustraliaGovernment encourages Foreign Direct Investment in Australia and supports in establishing the business. However, Government maintains the local law and also discuss with the provincial government to provide access for the organizations. Bureaucracy is moderate and corruption is lesser, compared to most of the countries of the world. If the decisions of the company or strategy of the company affects the people or province in negative way, Australian government will discuss along with its provinces and will not permit the action instead. So, it’s encouraging for Disney to invest in potential in Australia.BrazilBrazilian Government policy for FDI is open. However, there are severe bureaucratic & corruption issue in Brazil. The overall legal and initiating process for any business is lengthy. As Government safeguards FDI as domestic business, but due to corruption – it doesn’t work most of the time. As for Disney, it will be difficult to deal with corruption and bureaucratic economy.4.08 Diplomatic scenario between countriesUSA –AustraliaAustralia has continually strengthened its relationship with the United States since 1942. Australia is a vital ally and the United States and Australia maintain a robust partnership underpinned by shared democratic values, common interests, as well as cultural and historical similarities. Ties range from commercial, academic, and environmental, to defense cooperation. Australian forces have fought together with the United States military in every significant conflict since World War I. The ANZUS security treaty, concluded in 1951, serves as the foundation of defense and security cooperation between the countries. (Citation: )USA – BrazilThe United States is the first country to recognize Brazilian independence. Relations between the two countries have been relatively distant with brief periods of cooperation. There has been significant rupturing in Brazil-U.S. relations, over the revelation of U.S. mass surveillance programs in Brazil. Recently American-Brazilian relations have been strengthen significantly following the election of Dilma Rousseff as president of Brazil in 2011, and the recent deterioration of Brazil-Iran relations,(Citation: – Brazil-United States Relations)4.09 Mobility of the societyAustraliaPeople move a lot from city to city for living. In the 2011–12 year, the larger capitals grew almost 50 per cent faster than the rest. Over the last five years, the previously high population growth rates in regional Queensland’s major cities have moderated. Growth rates in Darwin and Perth remained particularly strong. Sydney is losing significant numbers of residents across all age groups but overseas migrants are taking their place at a rate that keeps Sydney growing, albeit below the national average.(Citation: .au)BrazilThe people movement from one city to another for living is minimal. People move from rural to urban cities, but in between the cities – the movement is low for living.4.10 Representation of women and minority group in media Strong in both the countries, as both have rich cultural heritage based on the aboriginal history. However, in both the countries – minority people are not a usual portray for the media. Both in Australia and Brazil, women are portrayed – but more respect is being given in Australia. Australia ranked 24 and Brazil ranked 62 in Gender Gap Index ranking in 2013; which simply represents the countries views on women representation in their society (including media). (Citation: The Guardian News)4.11 Standardization / localization of products or servicesAustraliaThere are minimal changes require for Disney to establish their business in Australia. Standardization option will work well. Translation of the rides and instructions must also be available in some of the Australian native languages.BrazilTranslation should be in Portuguese. No major changes required.4.12 Major CompetitorsAustraliaVillage roadshow theme park – owner of Dream World (Gold Coast)Warner Bros. – owner of Warner Bros. Movie WorldSeas World Entertainment – Owner of Sea World (Gold Coast)BrazilHH II PT S/A – Owner of Hopi Hari (Sao Paolo)Beta Carrero – Owner of Beta Carrero (Santa Catarina)(Citation: Wikipedia.Links)4.13 Media access and censorshipAustraliaMedia comprises of television, pay TV, newspaper, news website, radio etc.in Australia. Regulation of the media in Australia is limited to a narrow range of specific areas. The Australian Communications and Media Authority (ACMA) is the broadcasting regulator for radio and television in Australia. People has easy access to media in different forms. Consumers who have complaints about programs on television and radio content on the Internet can apply to the ACMA. The Commercial Television Code of Practice is a set of regulatory guidelines, registered with the ACMA and The Australian Press Council is the self-regulatory body of the print media. Censorship is largely the purview of the Classification Board, a statutory body which operates independently.The Australian Communications and Media Authority is active in making recommendations and setting guidelines for media censorship. (Citation: Wikipedia – Media of Australia)BrazilMedia comprises of television, pay TV, newspaper, news website, radio etc. in Brazil. However, there is a small amount of non-official censorship in Brazil till date. The current legislation restricts freedom of expression concerning racism and the Constitution prohibits the anonymity of journalists, although freedom of speech is enforced. Brazilian law enforces freedom of speech and press, and the authorities generally respect these rights. The independent media are active and express a wide variety of views with no restriction. There are no government restrictions on access to the Internet or credible reports that the government monitors digital media. Individuals and groups can engage in the expression of views through different medium of internet.(Citation: Wikipedia – Censorship in Brazil)4.14 General control & protection on International investmentAustraliaIn general, Australia has a liberal foreign investment and exchange control regime. Foreign investment is governed by Federal legislation and Federal Government policy. Exchange control is governed by Federal legislation and regulations. Foreign investment in Australia is regulated by the Foreign Acquisitions and Takeovers Act 1975 (FATA) and the Federal Government’s Foreign Investment Policy (Policy). The Minister responsible for making decisions under the regime is the Australian Federal Treasurer. The body that administers FATA is the Foreign Investment Review Board (FIRB).(Citation: atrium-incorporators)BrazilAll imports and exports are controlled by the foreign trade department of the BCB. For many years, local industry was protected from imports and the overall tariff burden was high. In general terms, trade barriers were set up because of the need to industrialize and to develop local industries, but also because of the foreign-debt situation. In the last few years, however, import duties and trade barriers have been gradually reduced and imports of various products are encouraged when local prices are higher than international prices, or when there is a shortage of local products. The federal tax system is not biased against foreign investment and there are no tax incentives that favor foreign investors specifically. There are restrictions in specific areas and bureaucratic delays and high import duties can nullify the advantages of importing. (Citation: PWC.de)4.15 Trade embargo, quotas & Trading blocsThere is no trade embargo or quotas for the two countries for Disney entertainment business. However, there will be standard taxation as per country’s rules and regulations. AustraliaAustralia is part of major two trading blocs – Asia Pacific Economic Cooperation (APEC) (From 1989) and Closer Economic Relations Agreement (CER) (From 1966). However, both these two regional integration were not trading blocks for others. APEC has strengthened the multilateral trading system and expanded economy by simplification of trading among the member countries. Similarly, CER was agreed between Australia and New Zealand to advance free trade & further integrate these two economies. BrazilBrazil is a member of the Latin American Integration Association (ALADI), the World Trade Organization (WTO), formerly the General Agreement on Tariffs and Trade (GATT), and the Common Market of the Southern Cone (MERCOSUR), whose members currently include Brazil, Argentina, Paraguay and Uruguay, with Chile, Bolivia, Peru, Colombia, Ecuador and Venezuela being associated countries. Under the MERCOSUR treaty agreement, tariffs are abolished; the movement of labor, goods and services is unrestricted; capital investment is encouraged; macroeconomic policy is coordinated; and foreign-trade policies and tariffs for non-member countries are harmonized. 4.16 Approvals and pathways for business Following is the “Ease of doing Business” ranking according to World Bank:(Citation: )The chart clearly indicates that Australia is superior option than Brazil in terms of getting things done in quick possible time.AustraliaBy the Australian Government’s act, it allows the Australian government to review the operations of foreign investors in Australia for establishing or for acquiring new business interests or property. The process is conducted by the Foreign Investment Review Board (FIRB). The FIRB is a non-statutory body that advises the Government on foreign investment issues. The Treasurer is responsible for foreign investment policy and for making the decisions on individual investment. When screening proposals, the FIRB can consult with Commonwealth agencies. In the cases where a foreign investment proposal does not conform to the policy, the Government has the power to block the proposal, or to order the sale of any property that was purchased contrary to its guidelines. Import tariff is lower, as there is trade agreement between USA and Australia for international trading. (Citation: )BrazilIn Brazil, all other exporting nations must pay the Common External Tariff (CET) (averages 14% to 20%), depending on the imported goods. Import tax is high in Brazil (up to 60%) and complex & time consuming procedures are there to lengthen the initial period of business. (Citation: )4.17 Negotiation stylesAustraliaNegotiation takes place with friendly engagement aimed at reaching a mutually agreeable solution. The primary negotiation style is cooperative and people may be open for the compromising attitude if viewed helpful in order to move the negotiation forward. If any dispute arises, taking the other side’s concern seriously and showing willingness to compromise matters most in the negotiation. Australian negotiators avoid aggressive techniques in the discussion. (Citation: MTSAC.edu)BrazilPrimary negotiation style in Brazil is competitive and Brazilians are often very aggressive negotiators. It is important to remain non-confrontational and avoid direct conflict throughout the bargaining discussion. Brazilian culture promotes a win/win approach and people usually value long term business relationship. Pace of negotiation is often slow in Brazil as they value relationship building, information gathering and analysis, bargaining and decision making time. (Citation: MTSAC.edu)4.18 Other Economic factors(Citation: )DISNEY’S Internal Analysis (SWOT)Disney is one of the biggest entertainment companies in the world. To expand into new markets, strategist needs to understand the probable countries PESTEL, along with Disney’s internal analysis to proceed to the next level. Following are the identified SWOT (Strength, Weakness, Opportunity, and Threat) analysis of Walt Disney:(Citation: )6. Scorecard for identifying the country for expansionWe will be selecting the country based on the balance scorecard on important factors of the country. For standing best in between the two countries, we will provide “3” point for each country, if the scenario are almost equal – we will apply “2” for each country. Country having less positive scenario in any factor will be given “1” point for that factor. The highest point achiever country will be chosen for Disney’s expansion.FactorsAustraliaBrazilLanguage issue31Cultural difference22Political stability21Suitable consumer market22Business Openness31Business Vibrancy22Govt. role in promoting business32Diplomatic scenario31Mobility of people31Representation of women and minority group32Media access & censorship32General control & protection of FDI32Trading terms32Ease of doing business31Ease of negotiation32Other economic factors32Total accumulated point4426Overall, the factors mostly are positive in Australia then Brazil. The overall socio, political, cultural and economic factors are suggesting the comparative better picture in Australia then Brazil. So, in overall perspective – Australia will be the suitable option for expansion for Disney.WORKS CITEDThe Walt Disney Company “About Disney”() 01 Apr. 2015Clark, Mitchell ( ) Business 2 Community 16 Apr.2013 Web. 01 Apr. 2015Statista “Revenue of the Walt Disney Company in the fiscal year 2014, by operating segment” () 01 Apr. 2015Find the Data “Compare”() 01 Apr.2015Economy of Australia Wikipedia: The Free Encyclopedia Wikimedia Foundation , Inc.() 29 Mar.2015 Web. 01 Apr.2015Energy Information Administration“Country Analysis Brief Overview”() Govt. of Australia , 28 Aug.2014 . Web. 01 Apr.2015Handle Export Consulting “Business Opportunites in Brazil”( ) 01 Apr. 2015Nations Online “Ocenia Languages”) 01 Apr. 2015World Business Culture “Doing Business in Australia”() 01 Apr.2015 Gustafson, Erica() Business 2 Community 01 Oct.2011 Web. 01 Apr. 2015KwintEssential “Brazil- Language,Culture,Customs and Etiquette”() 01 Apr.2015Politics of Australia Wikipedia: The Free Encyclopedia Wikimedia Foundation , Inc.() 22 Feb. 2015.Web. 01 Apr.2015Brazilian General Election 2014 Wikipedia: The Free Encyclopedia Wikimedia Foundation , Inc.() 22 Mar.2015 Web. 01 Apr.2015 ()The Big Picture “Theme Museum Index”() 01 Apr.2015United World “Our World Brazil”() 01 Apr.2015Santander Trade “Brazil Foreign Investment”() Mar.2015 01 Apr.2015U.S Department of State “U.S Relations with Australia”() 01 Apr. 2015Brazil - United States Relations Wikipedia: The Free Encyclopedia Wikimedia Foundation , Inc.() 27 Feb.2015 Web. 01 Apr.2015Australian Government “State of Australian Cities 2013” () Govt . of Australia 8 Dec. 2014 01 Apr. 2015Sedghi, Ami “World gender gap index 2013: see how countries compare” Guardian () 25 Oct.2013Media of Australia Wikipedia: The Free Encyclopedia Wikimedia Foundation , Inc.() 29 Mar.2015 Web. 01 Apr.2015Censorship in Brazil Wikipedia: The Free Encyclopedia Wikimedia Foundation , Inc() 08 Dec.2014 Web. 01 Apr.2015Atrium Incorporation Services”Australia Company Formation Services”() 01 Apr.2015PWC “Doing Business and Investing in Brazil”() 01 Apr.2015Doing Business “ Economy Rankings”() 01 Apr. 2015ITS Global”Foreign Direct Investment in Australia”() 01 Apr. 2015KPMG “Investing in Brazil”() Nov.2012 01 Apr.2015MTSAC.EDU.”Negotiating International Business- Australia”() 01 Apr.2015MTSAC.EDU.”Negotiating International Business- Brazil”() 01 Apr.2015Trading Economics”Australia GDP”() 01 Apr.2015The Walt Disney Company”SWOT Analysis”() 01 Apr.2015 ................
................

In order to avoid copyright disputes, this page is only a partial summary.

Google Online Preview   Download