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Pick n Pay Company was incorporated in 1967 with a fast-growing retail business in consumer goods. The company provides its services across South Africa. The Pick n Pay Company founder is Jack Goblin (Pick n Pay., 2022). The first retail outlet of Pick n Pay Company is located at Kenilworth, Cape Town, South Africa. The company has 1600 stores in seven African countries. In 2007, most of the company's stores were redesigned to get more attractive in customers' eyes. During that period of redesigning, a company's brand transformation that saw the creation of the new Pick n Pay company protocols and uniform services were adopted. The number of employees that are working in the company is around 90,000.
The main countries that are included in the international business of Pick n Pay Company are Namibia, Zambia, Botswana, Nigeria, Lesotho, and Eswatini. As the company continuously grows and expands its services into various countries of South Africa, it was founded in 2021, and it operates across eight countries at 1994 locations. The company owns a 49% share of supermarket chains in Zimbabwean country. The company sells a wide range of products, including grocery, general merchandise, and clothing retailers, at very competitive prices in the Boxer and Pick n Pay brands (Keikelame and Swartz., 2019). The company has generally been well-positioned in the core upper-income and upper-middle urban population groups, along with a strong store presence in its operating countries. Pick n Pay has also used technology by forming the company's online platform that allows remote shopping on its website.
The report discusses a home country internalization strategy of a case company, Pick n Pay group. The primary push and pull factors that affect the company's activities in the international market are also explained in the report. An overall analysis of the company's home country with the use of the PESTLE approach is included in the study. Pick n Pay is dealing its products and services in the industry supermarket chain, so a deep understanding of the supermarket chain industry is considered. Using Porter's five forces model, the company evaluates its competitive environment. The report contains target countries and a comparison between the two countries in which the company is operating. The report also highlights an internal analysis of a company's international strategy for executing the business.
A VRIOT analysis is used to examine the case company's resources and capabilities in the report. The report highlights the CAGE model to analyze the company's cultural acceptance of internationalization (Nair., 2021). As Pick n Pay operates in different countries of South Africa, the company's risk analysis is undertaken in the report.
The case company's headquarters lies in Kenilworth, Cape Town, one of South Africa's cities. Cape Town was the site of the first European settlement in South Africa, also known as the country's "mother city". The city was South Africa's economic base until the detection and misuse of minerals in the interior; whereas today, Cape Town is one of the country's most important major seaports and industrial centers. Cape Town is well-served by supermarkets and department stores (Mohamed and Abdul-Talib., 2020). The key medical problem in the city is pulmonary tuberculosis, which spreads rapidly because hygiene and nutrition are poor, and housing is overcrowded in every city center in South Africa. Pick n Pay made a great decision to establish the supermarket in Cape Town, as this city gave the company huge potential for growth and expansion.
South Africa is a hub of many big companies such as LinkedIn, Amazon, Microsoft, IBM, Apple, etc. The internationalization strategy of South Africa is divided into three parts such as industry-based factors, internal factors, and institutional factors. These hypotheses evaluate whether this strategy tripod is a good outline for a South African firm's internationalization. The industry-based elements hold that external forces related to the industry determine the firms’ performance and strategies. Based on the industry analysis of the competitive pressures, firms strategically position themselves in an industry. A high level of competition in the domestic market may push South African firms to engage progressively in international activities.
Figure 1 Africa has an opportunity to triple the historical manufacturing output growth rate and double output in 10 years
The resource-based view (RBV) holds that non-substitutable resources and capabilities, rare, valuable, and inimitable determine firms' competitive advantages and thereby shape their company's international strategy. South African companies' resources and abilities positively affect internationalization in the global markets (Roth and Hartnett., 2018). Institutional factors are defined as "the rules of the game", which include a formal as well as an informal dimension of a country. South African firms engage in upstream internationalization strategies to reimburse for an institutional vacuum in the domestic market.
Local Potentially global Global
Enter new business
Prepare for globalization
Strengthen global position
Consolidate export activity
Consider expansion in the international market
Seek global alliances
Stay at home
Seek international market
Prepare for a buyout
Figure 1. The Timing of International
Push factors are related to the phenomena in which a company's domestic market has highlighted a company to enter new markets. The push factor is a strong recent running throughout South Africa. The push factors related to South African countries are associated with factors such as economy, poverty, infringement of basic human rights, and education. The migration from Zimbabwe into South Africa is taken as an example for a better understanding of the push factors of South Africa. The effect of each push factor is discussed under:-
1. As Zimbabwe has a 95% unemployment rate, the number of migrants to South Africa increased.
2. More people are attracted to South African countries as only 480,000 people have formal jobs out of Zimbabwe's 12 million population.
3. Political unrest has devalued the Zimbabwe dollar, making it the World's least valuable monetary unit.
The factor of violation of fundamental human rights-
1. Ten million of Zimbabwe's 13 million people live in abject poverty.
2. Every third Zimbabwean kid is malnourished.
1. The Zimbabwean government has committed human rights breaches by infringing on several basic human rights, including the right to property, life, and freedom of movement.
2. The Zimbabwe population is strictly bound by the restrictions of freedom of the press, speech, and assembly.
3. Even though Zimbabwe still holds elections that are not fair, free, and fraudulent.
1. Around 75% of Zimbabwe’s state schools are not operated properly because most teachers are not working, as they are not salaried enough to survive and are looking for or working for food.
2. Since 1995, the literacy rate of Zimbabwe country has slowly been decreasing, so the people of that country went to their neighbor country, South Africa.
Pull factors refer to those phenomena in which a company is negatively affected in the international market. In this factor, other global markets and companies draw different companies to them (Ferwerda and Gest., 2021).
Geographically Accessible factor-
1. The unemployment rate in South Africa is 24%compared to Zimbabwe’s 94%, so to get employment and food for survival, the Zimbabwe population migrants into South Africa.
2. South Africa's monthly minimum wage is nearly 141 USD compared to Zimbabweans. The latter receive nothing while seeing they have a high rate of unemployment.
1. South Africa's borders have a high level of protection, whereas Zimbabweans can only have hope for a better life in South Africa (Nair., 2021).
1. In 2009, the economy of South Africa was ranked 25th in the World, with a GDP of $488,600 million.
2. The economy of South Africa continues to develop as the country hosts the 2010 FIFA soccer games.
Pick n Pay Organization operates as a grocery shop in South African countries. The general store industry refers to businesses that offer basic foods and comparable products in the retail environment. This industry is a subset of the food administration sector. This industry includes a variety of entities, the most common of which are business sectors and supermarkets (Das Nair and Landani. 2021). A few retailers furthermore provide clothing with essential food products. At the same time, most grocery shops provide natural items, meats, veggies, fishmongers, and fish available from ranchers and butchers. Expanding shop chains in South Africa offers considerable opportunities for providers, possibly opening up a lot more major geographical and economic areas for them. As a result, stores can be significant sources of strength for the push suppliers in light assembly and food handling firms in southern Africa. Legislators and retailers in South Africa have established provider development efforts. In any event, they have limited accomplishment because they are limited in scale and degree, are often spontaneous, and lack a provincial improvement point of view. There is a need for more controlled, coordinated, and territorially engaged barriers to increase provider assistance in South African shop supply chains. This mediation will result in fewer barriers to participation in the case organization's working country's retail business.
Figure 2.1 Projected E-commerce Revenue in South Africa
South Africa is improving conditions for potential groups. However, groups from outside the country are frequently asked if they should enter South African countries due to various concerns (Alanis., 2018). The PESTLE inquiry will look into the current state of South Africa and how it may affect the business there. PESTLE stands for political, financial, social, innovative, legitimate, and ecological investigation. Pick n Pay originated in South Africa and operates worldwide in eight countries. As a result, the company has a significant impact of PESTLE variables on its operations in multiple countries. The PESTLE study has been used to identify the outside factors of a case organization.
Favorable legislation trend
Funding private and public
War and conflicts
Cost of production
Import fees and taxation
Specific industry factors
Global recession recovery
Competing and evolving technology
Replacement and technical solution
Associated dependent technologies
Political factor- The South African political landscape is frequently muddled by well-known battles, defilement, savagery, political intolerance, and folly. These challenges typically stymie financial progress and development. These variables are generally linked to the degree of association and impediment of public and local government in an economic climate and business. Pick n Pay must strictly adhere to the domains and state strategies of the several countries in which it operates.
Economic factor variable includes financing cost, shopper extra cash, work economic conditions, tax assessment rate, the stage of the economy of the country name, financial execution of country name, growth rate, conversion scale, and so on. Regarding apparent GDP, South Africa is the 42nd largest economy on the earth (Nandonde., 2019). Pick n Pay can take advantage of the easy availability of money and active monetary business sectors in South Africa's value market to expand the organization globally.
Social factors include acceptance of societal roles and norms, attitude towards certain products and services, entrepreneurial spirit, demographics, culture, traditions, gender roles, leisure interests, and health & safety attitudes. South Africa leftovers with a divided society, and growing tensions among the local communities and migrants from other parts of Africa. Pick n Pay should build a local person team that understands the attitudes and societal norms better to attend to the customers in South Africa.
The technology factor portion of the technological variables is populace access to innovation, the rate of innovation-driven change, growth in item contributions, entrance to cell phones driving development, development in client administrations, store network disruption as a result of innovation access to more important data, and so on. In South Africa, online buying is at an all-time high. As a result, there are several opportunities for all South African online retailers (Njomane and Telukdarie., 2022). As the case firm updated with web-based retailing and offered conveyance administrations to its consumers' doors, the organization gained many potential customers.
Legal This component includes information assurance laws, licensed innovation liberties insurance, segregation regulations, equity arrangement, the time required to transmit equity, copyright regulation, bias toward home participants, etc. South Africa encourages Unfamiliar Direct Investment (FDI) in all sectors of the economy. However, certain foreign investment prohibitions exist in several areas of the country, such as security, mining, media communications, guard, banking, and television. Pick n Pay must carefully consider the regular season of the specific circumstances before joining a worldwide market.
Environmental factors environmental change, safe waste disposal, limiting carbon imprints, safe removal of hazardous material, insurance contracts, increasing center-around manageability, rules directing contamination, safe water treatment, and so on are examples of natural factors. Routine evaluation by genuine organizations adds to the cost of a case organization's activities. South Africa is one of the World's most well-known tourist industry destinations. However, the country suffers several natural challenges, including water contamination, land corruption, air pollution, deforestation, and severe waste contamination.
Supermarkets place a positive image of a city in a country. The supermarket industry has a different position in each country of the World. The supermarket chain industry has several advantages and disadvantages.
The advantages of the supermarket industry are:-
Disadvantages of the supermarket industry are:-
Primary competitors and their market share:
Some of the strong competitors of Pick n Pay are Shoprite Holdings Limited, Mass Mart, Spar Group Little, and U Save. Looking at the key aspects of its business, pick n Pay has a strong competitive advantage globally (Cebeci et al., 2020). The market cap of Pick and Pay is 2.37 billion US dollars being 3406th most valuable company in the World, having about 16% share of the food and grocery sector in South Africa. Yet, the competition is intense between existing retailers.
Porters Five Forces
Porter's five forces is a strategic management tool to be used by industries for analyzing and mapping the competitive environment for companies' smooth functioning and growth (Mugo., 2020).
Pick n Pay has set out to improve its approach towards application testing to be a success in the e-commerce business, making it easier for the management team by synchronizing and collaborations and being committed to reducing the impact on the environment trying to manage environmental rests small steps for environment and sustainability like green bags recycling reusable bags, etc. we can pay would be a success for environment giving awareness about the environment to the buyers would make a huge change (Plagerson et al., 2019).
Pick n Pay’s opportunities for profits.
Recently with a 5% increase in sales, 21% growth in the clothing division, and 57% higher in liquor sales, recommended to pay huge opportunities for profit with the tagline that lower prices look better. Its profitability was supported strongly by recent price hikes boxer brand being a strong contributor (Makhitha and Soke., 2021).
The environment in which the business takes the place of every company plays an important role in uplifting the image of a company in the country. Every company should have to save electricity, water, etc., which are related to the natural environment of a nation. Pick n Pay stores that were opened in past years are up to 44 percent more energy efficient than those opened in 2010. Pick n Pay has reduced electricity intensity by 32% since 2008. The carbon intensity of a case company is reduced by 0.9% as taking the 2013 baseline (Amusa and Oyinlola., 2019).
The case company is worried about sustainability based on the triple bottom line. The company constantly looks after its customers rather than looking at the environment, and after, it ultimately makes a profit. Pick n Pay is ever ready to adopt a more sustainable lifestyle for its company's domain (Criticos., 2019). The company is highly affected by the delegation of seafarers in the ocean. This negatively impacts the seafood department of a case company. Pick n Pay must involve developing a country's communities and allowing them to succeed in South Africa's economy.
Botswana is located in the center of Southern Africa, between South Africa, Namibia, Zambia, the UK, and Zimbabwe. In 1966, it was one of the World's least fortunate nations regarding freedom. However, it swiftly became one of the World's leading models of overcoming hardship. Huge mineral (precious stone) riches, fantastic administration, prudent monetary administration, and a generally small population of roughly 2.4 million (2021) have made it an upper-middle-pay country to be a top-pay country by 2036. As inflationary pressures mount, the Bank of Botswana has repeatedly committed to hiking the previously announced Financial Approach Rate beginning in early 2022 (Kruger et al., 2019).
Namibia is a geologically massive country with a small population of roughly 2.5 million people (2020) and a 1,500-kilometer-long South Atlantic coastline. The driest country in Sub-Saharan Africa is rich in mineral resources, including precious stones and uranium. It has borders with South Africa, Botswana, Zambia, and Angola. Political stability and strong fiscal management have aided in the reduction of poverty, allowing Namibia to become a middle-income country. Nonetheless, financial disparities – the legacy of formerly officially sanctioned racial segregation frameworks of government — remain extremely severe and have been exacerbated by the Coronavirus outbreak. Primary development imperatives have also impeded job creation.
Figure 3 By 2030, Africa will have 17 cities with more than five million inhabitants
Pick N Pay is a retailer in Botswana. Based on 75 online reviews (s), this Supermarket has a 4.2-star overall rating. Gaborone, Botswana, is the Supermarket's address.
Pick n Pay Namibia is a 100 percent Namibian-owned retail enterprise that has been serving Namibians for the past 17 years, with 20 locations around the country. Pick n Pay Model Namibia.
Pick n Pay Namibia has established a reputation as an exceptional store in recent years as continues with the objective to provide Namibians with development and an excellent shopping experience.
Pick and Pay Namibia has a colorful past. When the Model Stores' establishment agreement with Woolworths ended in 1997, another agreement was made with Pick & Pay, and the first shop was opened (Doh et al., 2021). Even though the Pick n Pay organization began in South Africa, Pick n Pay is a completely Namibian-owned organization that is a part of the Ohlthaver and List (O&L) Gathering of Organizations - Namibia's biggest privately owned business outside the mining area - which also has areas of strength for a heritage.
Pick n Pay is committed to bolstering community and boosting neighborhood pride by advancing Namibian governments and privately manufactured commodities, benefiting the Namibian economy. Furthermore, Pick n Pay Namibia now employs 1644 people across the country. As responsible corporate citizens, also prioritize long-term outcomes by focusing on sustainable development to benefit the economy and being mindful of the activity's impact on the environment.
As a proudly Namibian company, is committed to the advancement of the country and strives to make a constructive contribution to the networks where it operates to bring the O&L Gathering of Organizations' inspiration, "Making a Future, Upgrading Reality", to life. In that position, Pick n Pay Namibia supports many social upliftment campaigns, particularly programs centered on education because it is believed that education is the path to a better future.
Since the flagship shop debuted in 1997 at Wernhil Park Mall, expanded its footprint to provide top-tier administration to the entire country. There are now 18 planned stores, and the expansion strategy is on track (Benzaghta et al., 2021). Stores are constantly updated with the latest retail information to ensure that maintain the standard of excellence that valued customers deserve. Furthermore, as part of its commitment to remain the store of choice, is constantly expanding its product offering to provide consumers with a broader selection of value products at the greatest prices.
The key IB concepts and their interlinkages
The eight key notions memorized for the PYP are structure, capability, causation, change, association, point of view, obligation, and reflection.
Investigational Topics: Learning Focus Points
An examination of the concept of connections between Perusers, Journalists, and Texts;
An examination of how texts interact with Time and Space; an examination of intertextuality, or the relationship between texts.
IB concepts and mechanisms to analyze IB difficulties and create potential solutions 100
To begin student's thinking about the seven essential themes — communication, innovation, point of view, depiction, personality, culture, and change — author Brad Philpot has provided some options (Mbazima et al., 2021).
The IBS emphasizes calculated comprehension across all disciplines of knowledge in the DP language curriculum. This promotes a learning vision in which the development of language capacity and reasonable language understanding are correlated, giving the understudy the most forceful possibility for growth.
Change is one of the seven themes that aid in guiding and learning in the English A: Language and Writing Course. These seven principles, which connect to the three fields of inquiry, help students make connections between texts and fill in gaps as they progress through their studies (Ariwibowo et al., 2021).
Pick n Pay's characteristics to look at the critical components of its business, giving it an advantage on the hunt.
A brand's deficiencies are specific aspects of its company that it may address to increase its position further.
Any brand with open doors can embrace areas of advancement to grow its business. Geographic expansion, product advancements, improved correspondence, and so on may all increase a brand's prospects.
Threats to any business might be components that impair its operations. Some dangers include increased competitor activity, new government rules, alternative merchandise or administrations, and so on (Shaheer et al., 2020).1. Existing stores are seriously fighting.
The VRIN/VRIO evaluation is a fundamental tool for measuring and evaluating an organization's resources and determining its value and power. The VRIN/VRIO evaluation evaluates resources and talents while taking into account the surrounding traits:
The Pick n Pay Changing Its Ecological Impression brand values recall. This memorability directly results from the brand's strong trustworthiness and appositive brand value.
1.4. Propensity for innovation- The Pick n Pay Changing Its Ecological Impression is extremely inventive in its product contributions and administrations. The development often expands into other practical areas of the company, such as marketing.
1.5. Ability to raise capital-The organization can raise capital from outside sources. This capability has also enabled the firm to participate in consolidations and acquisitions, reducing market competition.
3.3 Marketing communications- Marketing communication for the firm is an inimitable resource that has enabled the brand to maintain a big advantage globally.
3.4 Competitive pricing- This cost-cutting skill enables Pick n Pay to change its Ecological Impression to consistently outperform competitors in significant assessing.
3.5 Customer experience- The organization interacts with consumers at multiple contact points. It provides an all-encompassing experience that pushes clients to make repeat purchases.
4.1 Financial strength- Financial stability is especially important for Pick n Pay, Changing Its Ecological Impression in enabling it to recognize potential results and open external doors.
4.2 Technological integration and advancement- The technological advancement enables Pick n Pay to change its Ecological Impression to maintain effectiveness and productivity in its various company cycles and operations (Hove-Sibanda et al., 2021).
4.3 Employee training- The organization's activity refines people not only for their employment and professional growth but also for self-awareness and advancement.
4.4 Organizational culture- This is a vital talent and asset for Pick n Pay Changing Its Ecological Impression, allowing it to expand globally and enable many modifications.
Pick n' Pay, South Africa's second-largest store corporate retailer has reported a nearly 7% increase in net profit due to a cost-cutting effort and a continuous 5% increase in sales, according to an allegation made by Work Day.
The basic retailer said the cost-cutting measures included reducing its workforce by 10% through a strategic severance program that cost $20.9 million for the 52 weeks ending February 25.
Pick n' Pay operates 1,685 shops, including 57 Zimbabwean outlets owned through its joint venture with TM Grocery stores. It opened 125 more in the 2018 fiscal year.
The Benefit Score is a key metric for assessing a stock's engaging quality. Pick N Pay Stores Restricted has a 6.00 Benefit Score.
Pick N Pay Stores Restricted has a greater Benefit Score than buddy gatherings. This means that Pick N Pay Stores Restricted has a much bigger benefit than its peer group.
o CAGE model – to be completed for the home country and the target countries
The CAGE business communication model is a tool that may be used to improve communications and coordinate efforts among coworkers. This approach is written as follows: culture + audience + objective = etiquette (C + A + G = E). It may also help people feel more at ease in their employment. It aids in making decisions in a behavioral emergency. It aids in determining the assumptions of others (Hove-Sibanda et al., 2021). It supports incorporating the organization's way of life into decisions. It aids in the ability to adapt to change.
? Cultural differences
? Administrative differences
? Geographical differences
? Economic differences
o Globe model
The " Global Leadership and Organizational Effectiveness Behavior" (GLOBE). GLOBE expands cultural findings inside a country to analyze the role of authority in culture to determine features that are commonly accepted vs socially unambiguous. "the GLOBE project classifies culture as common cognitive processes, values, beliefs, personalities, and the translation or significance of large events that result from normal contacts of individuals from aggregates that are conveyed through ages," GLOBE theory.
While collaborations between gasoline and accommodation businesses are not unique in South Africa, the new venture will see Pick n Pay offer petrol and comfort items on the assistance station forecourt. According to the terms of the agreement, BP will act as landowners and gasoline wholesalers. In contrast, Pick n Pay will serve as the franchisee.
Because the government administers petroleum, it will continue to sell at the common value until it relinquishes control over fixed costs.
Franchise of Pick n pay
Pick & Pay began as a family-run business and has now grown to include 1,795 outlets, 719 of which are enterprises covering their retail, express, clothing, and alcohol stores. Everything also falls into shape at Pick n Pay after two or three tough years. The organization's revenue has increased by 7.1% to R86.3 billion.
Pick n Pay has 552 shops, 304 of which are businesses. In general, 3000 square meters in size. This increases the complexity of running the firm and raises the underlying cost.
Pick n Pay will join the US market by employing new growth and market entry methods compared to those previously employed. Previously, Pick n Pay's systems for global development were used.
(1) To forcibly penetrate developing market markets.
(2) Focusing on less significant business sectors
(3) Entry via acquisitions Pick n Pay used various methods to penetrate the US market.
First and foremost, the organization stated that it would proceed cautiously by approaching west coast areas. In contrast to the growth observed in other corporate areas, the organization entered the California, Nevada, and Arizona showcases less vigorously. Second, the merchant market in the United States is very competitive. One of the major reasons for Tesco's previous triumphs is a lack of competition. Pick n Pay will face tough competition in the United States, including public competitors, local and territorial food merchants, and discounters. To compete more successfully in the US market, select and pay branded oneself specifically for American buyers.
While Pick n Pay has an openness to other African nations (approximately 5% commitment to agreements), which has occasionally contributed a small percentage of profit assists, the gathering's openness is limited. Its approach to dealing with further extension is quite cautious. The case country remains skeptical that the African region would ever be a major profit support. Therefore this helps to lean toward a reduced openness (Maumbe and Chikoko., 2022).
Increased deal and profit figure danger in terms of unpredictability and timeliness as a result of disruptions to standard exchanging designs and extra expenditures from Coronavirus throughout the pandemic and prospective modifications in purchaser behavior beyond that point. The below matrix table helps in understanding the risk of the country through the probability and consequences that occurred during the time to make important decisions about the company accordingly.
RISK ASSESSMENT MATRIX
Probability of Occurrence
Pick 'n Pay maintains a comprehensive list of the numerous Social responsibilities in which they are involved. There is also a comparison between the two countries based on market analysis and the best country is Namibia for business expansion which is explained through the effective analyses in the report. Namibia's biggest privately owned business outside the mining area - which also has areas of strength for a heritage. Spike focuses on the upliftment of children in South Africa, whereas Pick 'n Pay addresses various financial concerns such as education, poverty, the environment, and illness. Pick 'n Pay participates in many social programs to improve its public image and, as a result, influence its business. Pick 'n Pay has a wide perspective and intends to advance both broad-based and essential-based social duty. They have put together a 'code' to help Pick 'n Pay representatives.
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