Business organizations have the aim of continually developing their products and exploring new markets where their products would get more customers. This would in turn lead to increased productivity and profits. However, the exploration of a new market comes with various opportunities and challenges. In this regard, the business environment changes bringing new challenges such as changing cultures, strict legal frameworks, and changing customer needs. However, new markets presents advantage such as increased customer clientele, increased productivity, and more publicity. The movement of a business organization from one country to the other brings issues to do with management. In this regard, a new management should be created for the new country and hence leading to loss of jobs for the existing ones. This paper explores the effects of the movement of car Toys Company from the United States to Germany. Specifically, the benefits and challenges that would arise out of the movement would be discussed. Moreover, the management issues that arise out of the relocation would form the climax of this paper.
Benefits of Moving the Car Toys Company from US to Germany
Moving the toys company would result to increased global presence of the company. In this regard, due to the goodwill that was created in US, there will be a good reputation for the company in Germany. As a result, this will not be startup, as the organization already existed. Logistical issues such as how to run the business in another country would not arise. Additionally, issues to do with startup capital would not arise as the operating capital that was used in the US Company could also be used in the Germany market. Additionally, some of the management employees that were used in the US Company can be deployed in the Germany Company. This therefore allows the car toys company to take advantage of its wealth of experience that it had on the US market. The probability of the company picking up very well in the Germany market are very high as the company enjoys a huge wealth of knowledge on how car toys are produced, marketed, and delivered.
The movement of the car toys company would also have the benefits of establishing new customers and a new customer base. In this regard, the company would rely on the existing marketing frameworks that it used in the US to market its products in Germany. As such, there will be reduced costs with relation to advertising and marketing. The new customers in the Germany market will bring more profits depending on the demographics of the Germany population. In this regard, increased number of children in the Germany market means more demand for the car toys. This translates to more sales and hence more profits for the car toys company. This will also provide employment for people in Germany as the company would require people to manage the company in the market. Additionally, the Germany government would benefit from taxes that would arise from the new car toys company.
Challenges of Moving the Cars from US to Germany
The relocation of the company from US to Germany has the challenge of increased risks. In this regard, the new market would present a business opportunity that is filled with the risk of competition. Specifically, the car toys company would take time to settle in the new environment. There is a risk that it would face fierce competitions from the local German car toys companies. This might lead to a slump in the sales of the company in the first few months of its venture into the Germany market. The risk of the business failing to accrue the expected benefits is also a major challenge. In this regard, there is no guarantee that the expected returns would be met. Additionally, the changing buying styles of the German population would also be a great risk. In this case, there might be a scenario where their lifestyles differs from those of the US market. This becomes a critical challenge for the relocation.
An unfavorable legal environment also presents another challenge. In this regard, there are several legal procedures and requirements that the company must obey before it starts its operations in Germany. This relates to registration, permits, and other legal requirements. Additionally, the legal environment might not be favorable to the car toys company. The strict rules and regulations are not only costly in terms of the price of obtaining the permits and registration documents but also create an unconducive environment in which the business would operate. Notably, the legal environment can either encourage or impede the development of the business. Additionally, there is a risk that legislations would be passed that would not favor the new business.
The changing culture is also another challenge that would arise out of the entry into the Germany market. In this regard, the German culture is different from the US culture. Additionally, the language is also different. As such, familiarizing with the cultural orientations of the German residents would be an enormous challenge. Understanding their language would be an even greater challenge. Notably, a different culture could either work in favor of the new venture or work against it. This will depend on the ability of the company to understand and integrate into the new culture. More importantly, the value that the Germany citizens give to toys might be different from that of the US. This would make it difficult for the company to achieve its intended objectives. Indeed, a change in the management of the business would bring about various impacts. For instance, new employees in the Germany market will take time to integrate which will work against the company.
In conclusion, the movement of car Toys Company from US to Germany raises various benefits and challenges. This is because of the risks and opportunities that arise out of the entry of a business organization into a new market. One of the benefits is that the car toys company would have a global presence having had a market in US and having another in German. Additionally, a new customer clientele would be found in the new market. This will mean increased sales, increased productivity, and more profits. However, this relocation would not be without challenges. In this regard, the various risks of competition and failing in its goals is a challenge. Additionally, the legal environment would be a challenge, as it requires the observance of legal requirements and procedures. More importantly, the changing culture would work against the company as Germany has different language and culture from that of US. Indeed, the movement of cars from US to Germany would not be a walk in the park.
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