Introduction

Nowadays, the firms are looking towards the growth as a result of growing globalization as well as introduction of a new technology. The aim of every business is to take benefit of possibilities available in the new market, establish new branches, and boost bottom lines as a result. However, it has been shown that businesses must first grasp the new culture before creating new branches in new areas. Religion, language, work-style, culture, work ethics as well as corporate principles are among the difficulties that should be eliminating (Moreira, 2020). It is also suggested that the top management of the firm to form a team for working on faced difficulties. After this, this report will provide required suggestions to solve the problems. The problems encountered by Woolworths Group Limited, one of Australia’s largest retail firms, will be discussed in this study. It will examine the major difficulties they confront, identify the gaps, and make solutions to help them better their existing condition. The Indian market has been used as an example for the firm in this study.

Background of Company

Woolworths Group Limited is a leading retail company in Australia. It is the second-largest revenue-generating corporation in Australia. The company’s headquarters are located in Bella Vista, New South Wales, Australia. Supermarkets, hotels and bars, liquor sales, and hospitality services are among the company’s primary businesses (Dun & Bradstreet, Inc., 2021). The company’s overall revenues in 2021 were about $ 41,672.55 billion, according to financial records with 6.15% growth in sales (Anderson, 2020). There are about 215,000 people employed by this company. Since 1924, the firm has been functioning in Australia, and it now serves not only Australia but also India and New Zealand. Customers may expect high-quality items at affordable prices from the firm (Dun & Bradstreet, Inc., 2021). As a result, they planned large discounts for consumers, not only to lure them but also to demonstrate the worth of the items to them.

Challenges faced by Company in Expanding Business

Before expanding into other nations, the organization’s operations staff discovered several obstacles. When Woolworths wanted to extend its business in other countries, they ran across this problem and could not solve it without the use of effective business strategy. Followings are some challenges that are faced by the company in a global business environment in the regard of the Indian market:

Unpredicted Demand of Customers: Woolworths’ senior management encountered cultural problems and impediments since they were unfamiliar with consumer expectations, beliefs, local cultural values, work culture, language, customs, and religious feelings. This challenge is faced because of the differences in the earning capacity and purchasing power of the people in home country of company and host country. As a result, the operation of organization was harmed from a variety of angles, and the firm will fail to meet its objectives. In regard, the Woolworths, the management of the company has faced the same situation, and they were unable to extend their operations in the target market of India.

Differences in Culture: Another significant issue involves developing marketing tactics in a new context. It is vital to remember that there are cultural differences between Indian and Australian people (The Economic Times, 2012).For the business that serves its goods to consumers in both of these places, the demands, requirements, and expectations will alter to a larger level. As a result, it’s critical to first comprehend the culture, then identify the wants and expectations of consumers, and finally concentrate on putting in place a strategy that will aid in the formulation of necessary organizational tactics (Woolworths Group Limited, 2021).

Flow of Information and Way of Communication:
Another important issue that has been discovered during the expansion of business is organizational communication (Vijayraghavan, 2011). This is because that the decision-makers of the company uses English during communication and IT system to perform the organizational objectives and aims. For this purpose, company uses virtual team method to associate with the employees and managers of a company in other nations from its headquarter (The Sydney Morning Herald, 2009). During this, the virtual teams would not effective synchronize the objectives of the organization owing to time zone variations, problems related to scheduling, and an absence of mutual coordination between the responsible authorities. As a consequence of gap in the communication between the particular team members and project manager, performance gaps may take place are also widening.

High Operation cost: Export and Tariffs charges were also a major stumbling block for Woolworths as it expanded in India. When items are purchased in their country, the majority of nations will levy export taxes and customs. In a similar situation, Woolworths’ top management was obliged to give tariffs, obey Indian rules, assure legal compliance, and pay duties on export products to the Indian government. The management team of the company found it exceedingly challenging to handle such high-cost operations in the market of India. It did not seem right to grow in the Indian market.

Applying Relevant Frameworks and Management Principles to Overcome the Challenges

Overcoming the challenges, there are many frameworks for an organization that may be used in expanding the business in the global business market.

Solution 1: Before considering any of components, higher level management of the company should assess the entire customers’ demand in a new market by conducting customer survey among target customers. Consequently, the management should develop a segment map, select a target segment, and place products in concerned marketplace.

Solution 2: Woolworths’ management team should learn about Indian culture, analyze cultural trends and client expectations, and then devise marketing tactics to break into the Indian market.
As a result, they would better understand the organizational culture and, as a result, redesign their marketing methods in a particular workplace.

Solution 3: Senior management of the company may use the technology of project collaboration to promise effective communication and address the gaps in procedures used by the company. it can also make strategic joint venture like joint venture with Tata that will help in developing an effective and better communication pattern with the organization (Tata Consultancy Services Limited, 2021). It will aid individuals in overcoming significant operational issues, focusing on critical areas of globalization, creating expansion plans for India, and attaining necessary objectives in India. It will help Woolworths increase its overall profitability and bottom line in a certain scenario.

Solution 4: Woolworths would address the challenge of high operation outsourcing companies from Indian market to get products for Indian customers. Through this method, company will not face the challenge related to the lack of workforce for its operations.

Conclusion

In the aforementioned scenarios, Woolworths must focus on every concerned area to overcome cultural and language problems, tax laws, local compliance difficulties, risks related to supply chain, and risks related to HR management and operations. For meeting desired objectives of the organization in a particular business, top authority of the company should understand the organizational culture of the market, and then develop a planned map, to train the workforce, and operate following the principles of Ethics. Top management should keep trajectory of every of these tactics to assess the new location’s overall effectiveness. As a result, management of company would be able to change them as needed to ensure success in performing new business operations at the new market place in this project.

References

Anderson, T. (2020). Woolworths Group Ltd: March Quarter 2020 Sales Report. Retrieved from https://australianstockreport.com.au/insights/woolworths-group-ltd-march-quarter-2020-sales-report
Dun & Bradstreet, Inc. (2021). Company Profile. Retrieved from https://www.dnb.com/business-directory/company-profiles.woolworths_group_limited.a03dcfd23ee5f3f495d0cde8b82b0296.html
Moreira, A. (2020). Cases on Internationalization Challenges for SMEs. IGI Global.
REUTERS. (2019). Australia’s Woolworths to shrink Big W division as turnaround lags. Retrieved from https://retail.economictimes.indiatimes.com/news/food-entertainment/grocery/australias-woolworths-to-shrink-big-w-division-as-turnaround-lags/68670522
Tata Consultancy Services Limited (2021). TCS Recognised as Woolworths Group IT Partner of the Year for Second Consecutive Year. Retrieved from https://www.tcs.com/woolworths-group-it-partner-second-consecutive-year
The Economic Times. (2012). Tata Group’s Infiniti Retail to buy Woolworths consumers wholesale business. Retrieved from https://economictimes.indiatimes.com/industry/cons-products/electronics/tata-groups-infiniti-retail-to-buy-woolworths-consumers-wholesale-business/articleshow/16583591.cms?from=mdr
The Sydney Morning Herald. (2009). Woolworths sees fresh hope in India. Retrieved from https://www.smh.com.au/business/woolworths-sees-fresh-hope-in-india-20090802-e5tr.html
Vijayraghavan, K. (2011). FDI in retail: Tatas, Woolworths leave dispute behind, renew agreement. Retrieved from https://economictimes.indiatimes.com/industry/services/retail/FDI-in-retail-Tatas-Woolworths-leave-dispute-behind-renew-agreement/articleshow/11087602.cms
Woolworths Group Limited. (2021). Sustainability. Retrieved from https://www.woolworthsgroup.com.au/page/community-and-responsibility/group-responsibility/