Understanding Mexico's Business Environment Research Paper

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Bringing Dick's Sporting Goods Into Mexico

Dick's Sporting Goods is a company that is specialized in the manufacture and sale of sports gear within America and other 45 states around the world. It was started in the year 1948 by one ex-soldier, Richard Stack. After the World War 2, Richard retired and started this company. In a short while, the company grew to countries beyond the United States of America. The company also increased the capacity of its production and expanded the market. In all instances, the expansion was done to areas that were in need of the sports regalia. With developments in new sports in the world, the company has been in the forefront diversifying their production. This way, the company has kept being accustomed to the situation in the market. The expansion has also spanned through the areas of technology to bring new products that are better than the previous ones (Malinowski & Fuente, 2008).

Expansion to the International Market

The company has been making strides into the international market over the years. Over time, the company has been opening branches all over the world. The reason for this is to increase sales and make more profit. The local market has been saturated and over-utilized. Any expansion is through expansion into the international frontiers to increase the earnings. Before an entry into the international market, a study of the country of interest is done in order to know how feasible the market is. This is done on a frequent basis. It involves a study of both the culture and the economy of the country of interest. The cultural assessment is done with the aim of coming up with an understanding of the spending habits of these people as well as how the people behave and react to new products. For purposes of this study, Mexico was chosen as a country of interest. Mexico was chosen as it is geographically near the home of Dick's Sporting Goods (Higgs, 2010). This is done in a bid to assess how potentially easy it is to expand to the market within the American continent before moving out to the rest of the world (Pearce, 2012). The assessment will also seek to investigate and make out some conclusions about the economic status of Mexico. This study also seeks to assess the suitability of the country in comparison with the rest of the countries in the world.

Background of the country

Mexico is located in North America, although most of its engagements and cultural practices are aligned to the south. It is also evident that the country's culture is aligned with the central and South American nations. It is also clear that Mexicans have a unique cultural practice as compared to the others. The people of Mexico are mainly Catholics. More than 90% of the Mexican citizens profess the Catholic faith. This came because the Spaniards colonized the country. This also explains why the language of communication in this country is Spanish. Mexicans are known for their rich culture and pride in their practices. This explains why the country has been rated as one of the most richly founded cultures in the world. It is also noted that the country is more inclined to its internal practices than they easily adopt other people's cultures (McManus, 2013). There is also another angle to the culture of the people of Mexico. The people in this country have a high preference for their own locally produced goods over foreign imported goods. They prefer to consume their products that to purchase those which have been manufactured from outside the country (Malinowski & Fuente, 2008).

On matters of sports, the country borrows most of the games from America. For instance, the game of basketball and baseball that are mostly played in Mexico are borrowed from America. Mexico is also known internationally for its endowment in football players (American football teams in Mexico, 2010). Most of the football players in Mexico take part on the world football stage. The country has participated in world stage football. The country has also managed to outshine the rest of the American nations at this. Mexico is the leading country in the entire American continent in terms of football endowment. It is also seen that the world has been much awed with Mexican football to the point that some European football clubs have been buying footballers from this country.

The Economy of the Country

Mexico is among the top twenty largest and expanding economies around the globe.

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It is also ranked as the 11th country in terms of the Purchasing Power Parity according to the International Monetary Fund. The level of the economic growth in the country is on a steady rise. The level of growth in the country has also been fueled by the exploration of oil deposits in the country. Mexico is also famous for its local tourism. The level of tourism in the country is sufficient to rake in a sizable amount of foreign exchange (Stokes, 2012). This has enabled the country to go through the situations of economic downturns that have come over the world at times. The nature of the economy in this country is on a growing path. It is evident that the country has been encountering a series of growth due to its prudent leadership and the dedication of the ruling class to overcome the several issues that the country has been facing (McManus, 2013).

The country's GDP stands at 1.2 trillion dollars. This is a huge economic endowment. It is seen that the country has been to on growing its GDP annually in the recent past because the country has been expanding its exploration of the oil sector. The oil sector has gained value because of the global rise in oil prices. It is also seen that the increasing industrialization in the world has been putting pressure on the oil prices. The prices in these cases have been rising at a high rate (Malinowski & Fuente, 2008).

Cultural Influences on the Business

Regarding the consumption of sports regalia in the country, no many proceeds can be made out of the business since not many people in this country are not into diverse sporting. Other than the normal football and the basketball that the country has been supporting, the population in football is not sufficient to support the business of selling the regalia. It is impossible that the country has such a capacity to support any robust market in the sports gear. For a successful business in the sports gear, it is important to ensure that a larger population has to be committed to the sports that can be tapped.

From the look of things, it is not viable for Dick's Sporting Goods to venture into this country for business. This is informed by the fact that the available demand might not be sufficient to rake sufficient profits for the company. The demand level has to be noted to be in unresponsive to any attempts to increase the availability of the clothes and shoes meant for sports. Besides, the company has been disadvantaged while venturing into this market because of issues relating to sports acceptability. It is also seen that the country has a negative attitude to imported items, especially clothes. The popular Mexican culture is celebrated in the manner of dressing, dancing, and cuisine. The dressing style is purely Mexican, and this has made the country reject anything foreign. It is also seen that the people are very nationalistic and thus work to promote their homegrown products. Mexico has a number of local companies that manufacture and sell sports regalia. It is also evident many people are interested in the business of producing sports attire in this country. This creates the possibility of a multinational company (Stokes, 2012).

The viability of the market in this country is unlikely to support any form of business in this regard. There are high chances that the citizens are likely to appreciate any multinational product in this country (Mexico, 2013). This will mean that if sales have to be made here, then the concerned company has to employ drastic marketing strategies, which will include selling at a very low price for a very high-quality product. However, this will be counterproductive since there are too many costs involved in this trade. Given the need for cross-border transportation costs from the home country, it will be much costly to engage in any trade of this kind. Therefore, it is advisable not to invest in this country's market.

Political and Government Influences on Trade/Business

The political climate does not support many international companies. Local politicians are very individualistic and at the same time keen on controlling the local business and trade. This way, the country is put in such a mood that is against foreign investors coming in to make investments. The concerns that the citizens have is that they might also lose a chance for the jobs that.....

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