GENICON: A Surgical Strike into Emerging Markets Executive summary GENICON Company which was founded in 1998 is an original equipment manufacturer and produces medical devices for firms with their branding and labels("Genicon - New Ideas For Modern Healthcare", 2016). The products of the company are the premium price, of high-quality and disposable. The market for GENICON has been favorable since the company has dominated the U.S industry. The company needs to diversify and enter the international markets which have the potential for growth. The company needs to look into the markets of China, Russia, India, and Brazil regarding government policies, taxes imposed on imports, cultures of the countries and the level of competition to decide on the best market. The different markets have different characteristics, and the company needs to be careful to ensure they join a market that will bring forth growth and development. Additionally, the company will require adopting new strategies once they choose the market to venture in. The case study of each country will provide the necessary insights on the important issues that the company should consider before they choose their market. Each country is analyzed based on the economic performance, political, social and regulatory requirement making it easy for the company to make a decision. Problem statement GENICON is faced with the problem of deciding which of the emerging markets it should enter to ensure the expansion of the business. The company is faced with the problem of limited resources, therefore, making it hard to decide which country the company will invest in. The company needs to ensure they have growth and diversity; therefore, they have to identify, evaluate and develop new markets. Analysis From the four markets, GENICON is choosing from 3China has the fastest growing economy across the globe. The medical market was 12.64 billion dollars in 2008 and was expected to be 23.25 billion dollars in 2013. The Medical devices imports of China are expected to grow at an average of 20% in the next three years (Clow & Baack, 2012). Additionally, China has the largest population with the majority being the old. The healthcare system in China is centralized, but currently, the private sector has been on the rise with the country's Ministry of health-promoting the private sector to cater for the shortage of resources. Corruption and political influence in the medical devices market are relatively low. The U.S is the largest importer of medical devices in China. Therefore, the patent protection in the country is relatively low compared to other countries. The Chinese usually view medical devices from foreigners as more credible whereby the products from local suppliers are of low to mid-range quality while those from foreigners are of high- end quality. Entry into the Chinese market is stricter on medical devices, and the process takes one to three years. Also, the country has a shortage of medical personnel, therefore, impacting on the growth of the market. India has a rapidly growing economy but is still ranked as a developing nation. The medical device market in 2008 for India was valued at 2.35 billion dollars and was expected to rise to 4.01 billion dollars in 2013. The growth rate from 2008 to 2013 was expected to be 11.3% on a year to year basis. The importation of medical devices in India has increased to around 75%. The country has a fragmented healthcare system, and most of the citizens do not have access to quality health services. Additionally, the country faces a huge deficit in medical infrastructure and a shortage of skilled human resources. The country's laws and regulations make it difficult for a foreigner to invest. Also, the public sector process of registering is bureaucratic and ambiguous. India is also faced with various cases of political instability. Brazil has 1had one of the largest economies in the world. The medical devices market was 3 billion dollars in 2008 and was expected to rise to 5.7 billion dollars by 2013. The annual growth of the device market was expected to grow by 2.4% from 2008 to 2013. The medical devices market in Brazil has not been experiencing growth in the last two years in its GDP. Entry into the market in Brazil will be easier since U.S has around 30% of the market share and uses distributors and local agents who sell the devices to hospitals and health centers. The country’s business culture heavily relies on the growth and development of a strong personal relationship. Therefore, GENICON needs to develop relationships in Brazil by meeting one-on-one with the potential 4clients. When developing the Brazilian market, it will be necessary to work through qualified representative and distributor. The Russian Economy has been in transition and 1its medical device market in 2008 was approximately 1.89 billion dollars. The worth was expected to rise to 2.88 billion in 2013. The medical devices market in Russia has a slow and constant growth. Around 2% of the medical facilities in Russia are in hazardous conditions. The country has a bad reputation of being corrupt when it comes to health care policies and practices. Additionally, there have been several cases of political tension between Russia and the U.S. Russia also has a decline in population which will not be advantageous for the company to enter into this market. The variables that need to be considered in the entry of new emerging markets are health centers and hospitals availability, the level of corruption, exchange rates, the taxes imposed in a country and the political risks involved in doing business in any of the countries. Additionally, the population is an important variable that will influence the penetration into the market. Therefore China is the best mark for the company to enter. The Comparison of Countries Figure 1: Economy Technology Wealth index Regulatory mechanism Government Business history Brazil 6 6 4 5 8 3 Russia 5 2 3 1 1 2 India 8 7 3 6 6 5 China 9 9 4 8 9 5 The scale shows 1: poor, 3: good, 9: excellent Figure 2: 2population GDP (trillions) GDP growth Expenditure on health % of GDP2Doing business rank Brazil 201million 2.39 -0.9% 1 .2% 116 Russia 143 million 2.38 4.3% 1.5% 80 India 1.22 billion 4.76 6.5% 2.8% 74 China 1.43 billion 11.3 7.8% 4.2% 32 Discussion of Alternatives GENICON Company can decide to enter the Chinese market or the Indian market since they are the most favorable. There is a high demand for innovative foreign products. Competition is relatively low on the imports as people few them as of high quality(Khanna, Palepu, & Bullock, n.d. 2013). Additionally, the high population and the government support of private sector will enable the company penetrate the market and become successful. The government has the best ways of doing business with foreigners with reduced bureaucracy and low corruption cases, especially in the healthcare sector. However, the Chinese market may be difficult to penetrate due to a lot of time wasting in the registration process which will be wasting the company's resources. The Chinese market has several local suppliers, therefore, competition levels will be a bit higher, but due to the favorable policies, it will be the best market for GENICON to enter. GENICON can also join the Indian market since the country is highly populated and the majority of the healthcare services are still developing, therefore, the company will be able to hold the majority of the market(Wellman, 2014). The technology used is relatively improved making it easy for the company's operations. The country supports the health sector whereby they have located 2.8% of the country's GDP in the health sector (NPCS team, 2014). It is also easy for the company to do business in India as it allows foreign importers. In India, there is an increase in the demand for new goods and services from the middle class who have become relatively emerging. The country is more transparent in its regulations, and the levies are reduced. On the other hand, India has a high political risk since its processes are bureaucratic. Additionally, India is very poor which may not attract investors due to the poor currency of the country. Recommendations GENICON should provide very high-quality products to ensure that they dominate the market since locals believe in imports as compared to local produce. Quality and reasonable pricing should be the strategy that GENICON Company uses to ensure they have more sales and profitability. Additionally, the company should ensure they secure a legal patent to their innovations and products to prevent cases of counterfeit products in the market which can cause the decline in sales for the company. Patent protection will help the company maintain the quality of the products within the market which will create the brand image and customer loyalty. Additionally, due to the lack of skilled personnel, the company can bring in several professionals from the company once the company enters into the market to ensure that the locals are well trained on the use of the products. The company should employ locals who are learned and skilled in specific sectors to ensure that they do not waste much time in the training process. Proper training will bring forth efficiency and productivity of the company, therefore, increases the sales and wealth of the company. Management should encourage the locals to further their skills by providing more seminars and workshops.