IT Zara2

Due to the fact that Africa has developed in the direction of actively attracting foreign investors, which are creating increasingly favorable conditions, there are great opportunities for doing business. According to World Bank forecasts, the continent could be "on the verge of economic growth the same way China 30 years ago and India 20 years ago." The views of the past decades about Africa as a continent of unpromising backwardness and total poverty no longer correspond to reality. The accumulated lag is still great, but Africa as a whole, and in particular sub-Saharan Africa, is gradually beginning to catch up.But despite the open access to the South African market there are a number of problems. We can face the risks of a sharp accelerated fall in the value of the acquired assets (investments) due to the narrowness of the local market, unfamiliar features of reporting, accounting and bookkeeping, audit standards, nationalization, expropriation, confiscatory taxation, economic conflicts, political changes or diplomatic complications. To this are added threats formally not considered investment risks - difficulties or misunderstandings in asset valuation, reduced liquidity, problems in the sphere of legal regulation, actions of state authorities and management.Despite rapid economic growth, huge opportunities and prospects, it is impossible not to take into account the existing risks of doing business in Africa, both economic and socio-political. This is a weak fiscal and monetary policy, the level of inflation, the instability of local currencies, high taxes, the risk of nationalization, low qualifications, underdeveloped infrastructure, bureaucracy. The key obstacles to business development in Africa are the backwardness of infrastructure, mainly in transport and energy. While key indicators of the African economy are improving, the conditions for doing business remain rather complicated. The continent suffers from a high level of corruption, low skill in the workforce, ill-conceived policy and weak legislative base.Evaluation of Tesco's internationalisation strategy into South AfricaThe best strategy for Tesco will be the takeover of Shoprite Holdings. The Shoprite Group of Companies, is Africa's largest food retailer. It operates 2653 outlets in 15 countries across Africa and the Indian Ocean Islands. The company's headquarters are in the Western Cape province of South Africa. Shoprite Holdings Ltd is a public company listed on the Johannesburg Stock Exchange, with secondary listings on both the Namibian and Zambian Stock Exchanges. Tesco has a large experience in the absorption of retailers: 1968 — Victor Value, England1994 — William Low, Scotland1995 — Savia, Poland1997 — Crazy Prices, Ireland2002 — HIT, Poland2002 — T & S Stores, England2003 — C Two-Network, Japan2003 — Kipa, Turkey2006 — Julius Meinl, Poland2006 — Leader Price, PolandThis will save you from all the difficulties that you can face in South Africa. First all the shops will work under the old signs. But over time, when the locals get used to the new standards of shops, they all start working under the brand Tesco.Conclusions and recommendationsTesco is the UK's largest retailer of products and non-food products. Here, this brand is known literally to everyone - even in a small provincial town there is a large Tesco. A total of over 2,700 shops of various formats are scattered throughout the country: from the hypermarket to the "shop near the house." The impressive size of the army of regular customers - holders of club cards of 12 million people - is the best proof that Tesco offers its customers an excellent combination of price and quality.The only successful strategy for entering the South African market is to absorb the already existing network.ReferencesHirsh, L. 2008. Grocery rivalry heats up between Tesco, supermarkets. California Press- Enterprise (15 February)Hofstede, G. & Hofstede, G.J. 2005. Cultures and organizations: Software of the mind. 2nd Edition. London: McGraw-Hill.Koller, G. 2005. Risk assessment and decision making in business and industry: A practical guide. London: CRC Press.Mockler, R. 2002. Multinational strategic management: An integrative entrepreneurial context- specific process. London: Haworth Press.