Factors that have influenced East African Breweries Limited to go International

Abstract

Success in international competition demands that firms translate domestic positions into international positions. Firm is influenced to enter international markets resulting to international integration of markets is facilitating decentralization by reducing the economic costs of smallness. Companies wishing to pursue a long-term position in a foreign market need to be more proactive in their approach to market entry by becoming directly involved. The objective was to determine factors that influenced East Africa Breweries Limited to go into international. This research adopted a case study approach. A case study enabled the researcher to have an in-depth understanding of the factors that have influence East Africa Breweries Limited to go international. The researcher used both primary and secondary data. Primary data was collected using self-administered interview guides while secondary data was collected by use of desk search techniques from published reports and other documents. The interview guides consisted of openended questions. The study population was 35 interviewees who included the managers across all departments working in East Africa Breweries Limited. From the findings, the study established that when EABL wanted to start competing globally, the strategic decision on entry was made and it fundamentally benefited the firm, including its operations and its management. The study established that EABL had plans to develop new product policy and strategy that is sensitive to market needs, competition, and company resources on a global scale. Several reasons influenced the firm to internationalize in emerging markets. These include to gain a greater market opportunity, maximize on profits of the company and to expand and have a greater feeling of the market. At the most basic level, firms’ motivations to carry out FDI falls under resource seeking, market seeking, efficiency seeking, and strategic asset seeking categories. The study found that the need to originate, produce, compete and market beer industry products worldwide influenced EABL to go international. The choice of the correct entry mode for a particular foreign market is a critical marketing decision. The study concludes that survival and success of an organization would occur when the organization creates and maintains a suitable match between its strategy and the environment and also between its internal capability and its strategy. The process by which resources and capabilities are transformed into a competitive advantage for the organization that has gone international follows the key elements in the process of international market entry and expansion for production firms, such as the EABL