MN5005NI Transnational Business Management

Submitted to: Sinja Poudel ma’am

Submitted by:
Cristina Limbu
Drishya Shrestha
Elina Mainali
Kripali Ghimire
Pema Yangzen Lama
Suju Sherchan
• About the company/product
• Advantages of the product
• Best suited market
• Pashmina inside Nepal
• Strategies to enter the best suited market
• Pashmina outside Nepal
• Requirements to enter the EU market
• Competitors of Pashmina
• Risks and barriers
• SWOT analysis
• Sustaining growth in other market
• Porter’s Five Forces
• Porter’s Diamond Model
• Market research in China
• Comparative and competitive advantages
• Market research in India
• Other possible markets
• Market research in EU
• References
 PRASID PASHMINA INDUSTRY

• One of the leading manufacturers and exporters of cashmere/pashmina

products
• In this business for more than 22 years
• Knitted and woven cashmere/pashmina goods for high quality
• Promotes jobs in its manufacturing for marginalized families
• Medical care and support for their staffs, pays for personal injury benefits
• Trains qualified workers
• Offers education scholarships for the children of the employees.
 Advantages of the product

• Offers “CHYANGRA PASHMINA” label for 100% Cashmere products

• Weaving is all done by hand on loom specially made for their work weavers are young Nepali-
Tibetan men and women who works day and night to produce beautiful Pashmina products.

• To beautify the living space

• Keeps the body cozy

• To spice up the appearance

• Helps in increasing the flavor of the dress

 Pashmina inside and outside Nepal

• The finest inner wool that grows as a layer at the very bottom of Himalayan goat’s dense and course
fiber. One of the finest, warmest and lightest wool found in nature.
• Has become the country’s third largest overseas export item
• Considered as a multi- purpose handmade high- quality woolen product.
• They are strictly export- oriented sectors.
• It has been given the impression that as many as 5% of its goods can be consumed within the country,
more than 50% of the overall export figure for craft goods is accounted for by Pashmina products. And
it is also the main export part of the group of craft products.
 Strength
• Successful introduction of the pashmina
mark for the branding by Nepalese
Producers
• High employment opportunities
• Ability to handle small high value orders
• Low labor cost
• Excellent long term relationships with
buyers
Opportunities
• Significant spare capacity to increase
production and export to new regions
• Potential to expand in existing and new
market
• Potential to increase goat farming and
invest in domestic yarn producing
• Increase in demand
Weakness
• Lack of technology and facilities
• Import of yarn at higher prices
• Difficulties to adapt in changing market
demand
• Necessity of import of silk at higher
prices from India
• Weak networking in international market
Threats
• Price competition with China and India
• Shortage of skilled labor due to very
large outmigration
• Counterfeed products harming image
 Buyers Power

• Price Sensitive
Porter’s Five Forces • Production differentiation Analysis
• Substitute Available
• Brand Identity
MODERATE
Entry Barriers Threats of Substitute
Industrial Competitors
• Brand/new competitors • High and Different Competitors • Switching cost is high
• Barriers to distribution • Product Differences • Price Performance
• Government Policies • Brand and Identity of Product MODERATE
LOW OLIGOPOLY

Suppliers Power

• Switching cost on ingredients

• Cost relative to total purchase

HIGH
Market analysis of China
  Government stability, regulations

P  International trade

 Strong financial sector


E
Interest rates
 Inflation
 Currency

 Population, demographics
 Unemployment

S 


Standard life style
High income
High consumption power
  Investment in research and development

T  Speed of technology transfer

 Tax policies

L 

Anti trust laws
Consumer protection laws
Employment laws

 Climate

E  Environmental policies
 Corporate social responsibility
 Market analysis of India

• 30 tons in 2013 and 70 tons annually in 2015

• The best quality of pashmina though China is the largest producer.

  Has a stable political environment.

P  Disputes with Kashmir might be a problem for pashmina industry

 Corruption

 One of the largest economies in the world

E  Lowest corporate tax in the world

 (22% from 30%) -existing, (15% from 25%) for manufacturing companies

 Huge opportunities for multinational companies

S  Cheap labor
T  Technologically advanced country

 Destination for FDI

L  Number of labor laws for regulations of employment relations in India

E  Faces environmental challenges

  An economic and political union between 28 countries
P  Good relation with the USA

 The European single market

E  Free trade agreement with number of other countries

 Largest trader

 Shared and rich culture

S  Social challenges
  Science and technology

T  Strong shipping, railways and aerospace

L  The EU law

E  Tourism
 Why EU?

•The single currency with no tariffs.

•Nepal’s Pashmina sector gets EU boost
• Extreme Cold winters (approximately 6 months long or even more)
• Employment rate
 
 Requirements to enter our product in EU

•EN product safety standards.

•Substance restrictions.

•Document requirements

•Labelling requirements
 Risks and barriers

• Presence of other competitors

• Demand of the product
• Government policies
• Tax policy
• Trade restrictions
• Market structure (oligopoly, monopoly or else)
• Regional treaties with Nepal
• Types of trade policy adapted
• Treaties
• Taste and preferences
 Strategy to enter foreign market

• Reduction in price -> the silk pashmina combination which was developed 1 st in Nepal
• Focusing on improvising technology
• To be honest to the costumer
• Enter France, Germany or Italy market 1st
• Direct export first, then FDI
 Porter’s Diamond Model

• The raw materials from the Himalayas

(Manang, Mustang) from the goat called
Chyangra
• very high demand, basically concentrated in
Kathmandu
• main strategy to give priority to customer
satisfaction.
• competitions help our industry to become
more innovative and compete in the market.
 • Low labor cost, provides education scholarship for the
employees’ children

• Chyangra Pashmina allows us to label its tag to our pashminas

which helps people to believe in our product.
 Comparative and Competitive advantages

Comparative advantages Competitive advantages

• Highly potential country for the • Manufactures high quality, stylish

production of pashmina. pashmina products

• Land cost and technology cost is • Finest packaging than India and China
comparatively lower in Nepal.

• Environmental friendly • Nepal exports to 47 countries

 IMPACTS OF COVID-19 IN THE BUSINESS/POSSIBILITIES OF
DAMAGES THAT CAN BE CAUSED BY PANDAMENIC

• Travel restrictions and quarantine can result in shortage of labor, raw materials, supply chains and sales of
the company.
• The smaller the company, the harder the hit as the company will lack cashflow and capital.
• This pandemic has rapidly declined the market of pashmina.
• Stores shuttered.
• E-commerce sites for selling goods were also shut down.
• No help from the government.
• Will be at great risk of closing permanently if the crisis continues for the several months
• Company maybe in need of financial assistance due to the crisis.
• No revenue but growing expenses.
• All of the above-mentioned impacts will result in fall on revenue of the company.
 Other possible markets

• Franchise

• Promotion

• Sponsor events

• Geographical indication

• North America and Scandinavian countries such as Denmark, Norway ,Canada etc. because of more

per capita income and geographical reason.

 References

References
PESTLEanalysis Contributor, 2014. PESTLE Analysis of India in five Steps. [Online]
Available at: https://pestleanalysis.com/pestle-analysis-india/
[Accessed 12 November 2020].
Bhadauria, S. S., 2016. Contemporary Kashmir Pashmina Trade Policies and Practices. [Online]
Available at: https://www.researchgate.net/publication/322116463_Contemporary_Kashmir_Pashmina_Trade_Policies_and_Practices
[Accessed 11 November 2020].
iMartNepal, 2014. Nepalese Pashmina. [Online]
Available at: https://imartnepal.com/blog-article/nepalese-pashmina/#:~:text=The%20Pashminas%20have%20very%20high,95%25%20are%20considered%20for%20exportation.
[Accessed 20 November 2020].
Pareek, P. K., 2013. Pashmina fibre-Production, characteristics, utilisation. [Online]
Available at: https://www.researchgate.net/publication/265016291_Pashmina_fibre-Production_characteristics_utilisation
[Accessed 18 November 2020].
Rahman, M., 2020. PESTEL analysis of India. [Online]
Available at: https://howandwhat.net/pestel-analysis-india/#:~:text=This%20detailed%20PESTEL%20analysis%20of,in%20global%20trade%20and%20politics.
[Accessed 11 November 2020].
Slideshare, 2017. Benefits of pashmina shawl. [Online]
Available at: https://www.slideshare.net/Kashmirbox/benefits-of-pashmina-shawl#:~:text=To%20Spice%20up%20the%20Appearance,it%20through%20the%20waist%20bands.
[Accessed 29 November 2020].
swingaunt3, 2018. What are the benefits of pashmina scarves?. [Online]
Available at: https://swingaunt3.wordpress.com/2018/12/02/what-are-the-benefits-of-pashmina-scarves/
[Accessed 29 November 2020].
Trade and Export Promotion Center, 2020. Pashmina Products. [Online]
Available at: https://www.tepc.gov.np/major_products/full_content/pashmina-products
[Accessed 29 November 2020].
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