Costco and the Aussie shopper : a case study of the market entry of an international retailer

Retailing is a globalized industry yet retailers must respond to local shopping habits if they are to be perceived as legitimate by the host country customers. However, some retailers may be unable or unwilling to respond to all customer requirements. Costco, the membership warehouse club retailer, has been successful in its international expansion efforts, establishing its first Australian store in Melbourne in 2009. In the first twelve months of operation, the store became one of Costco’s top five stores in the world. We investigate this success focussing on the customer, and use institutional theory to analyze what concessions were made by the customer and the company. Data were collected from consumer interviews, site visits and secondary media and industry sources. Analysis revealed negotiations based on the rejection, acceptance or adaptation of the regulative, normative and cultural cognitive aspects of the Australian shopper and the Costco business model. Customers made concessions to accommodate the new business model, and Costco responded to entrenched Australian shopping habits. This case is the first to explore the outcome of retail internationalization from the customers’ perspective, revealing the concept of mutual concessions. The interaction and subsequent adaptation by both customer and retailer have resulted in the institutionalization of new shopping norms in the host country and success for the international retailer.

ACE research briefing paper 002: learning and adaptation in the business creation process

This year marks the completion of data collection for year three (Wave 3) of the CAUSEE study. This report uses data from the first three years and focuses on the process of learning and adaptation in the business creation process. Most start-ups need to change their business model, their product, their marketing plan, their market or something else about the business to be successful. PayPal changed their product at least five times, moving from handheld security, to enterprise apps, to consumer apps, to a digital wallet, to payments between handhelds before finally stumbling on the model that made the a multi-billion dollar company revolving around email-based payments. PayPal is not alone and anecdotes abounds of start-ups changing direction: Sysmantec started as an artificial intelligence company, Apple started selling plans to build computers and Microsoft tried to peddle compilers before licensing an operating system out of New Mexico. To what extent do Australian new ventures change and adapt as their ideas and business develop? As a longitudinal study, CAUSEE was designed specifically to observe development in the venture creation process. In this research briefing paper, we compare development over time of randomly sampled Nascent Firms (NF) and Young Firms(YF), concentrating on the surviving cases. We also compare NFs with YFs at each yearly interval. The 'high potential' over sample is not used in this report.

Alleviating poverty by engaging in microenterprise : how can INGOs in Vietnam help microenterprises overcome market constraints?

Microenterprise programs (MEPs) that aim to help poor communities engage in micro businesses have contributed significantly to poverty reduction in developing countries. However, a review of the literature suggests that the current approach adopted by MEPs has mainly provided services to microenterprises (MEs) based on what MEPs can supply rather than on what MEs actually need and what the market demands. Therefore, MEPs’ approaches are more likely to be supply driven. Yet when there are market constraints, such as high competition or low demand, this approach has been linked to the failure of MEs in their infancy. The alternative is a demand driven approach, in which MEPs provide MEs with support based on what MEs need, and what markets demand. However, research examining the application of this approach is limited. In order to gain an understanding of the approaches of MEPs, to identify whether these approaches are demand or supply driven, and to discover how these approaches are used to help MEs operate under market constraints, this study examined the operation of International Non-Government Organisations (INGOs) operating in Vietnam. This exploratory study involved in-depth interviews with senior executives from 10 INGOs. Thematic analysis was used to analyse data collected from the in-depth interviews. The results were further verified with publicly available data from the INGOs. The findings of this research indicate that the demand driven approach is dominant in most approaches of INGOs in Vietnam, and has become a key approach in helping MEs deal with market constraints. Further, rather than explaining the demand and supply driven dichotomy, the findings highlight that MEPs’ approaches can be viewed in two dimensions: a participant-demand driven approach focusing on the basic needs and capabilities of the extremely poor, irrespective of market demands; and a market-demand driven approach focusing on the capabilities of poor communities, while also accommodating market demands. This research provides contemporary and practical insights into the DD and SD approaches, and a better understanding of MEPs’ approaches to MED in Vietnam.

XBRL : the future of financial reporting and a catalyst for capital market development

There has never been a better time to strengthen financial reporting in Fiji. With increased interest shown by prospective companies in capital market participation, the pressing problems in the public sector reporting and accountability and global emphasis on the increasing need to strengthen the corporate governance structure, this is perhaps the opportune time to consider the potential of XBRL.

Profit and organisational legitimacy in an emerging market

While there is common acknowledgement that the main aim of organisations is to maximise shareholder wealth, firms also have the obligation to manage the needs of a broader group of stakeholders as these firms are a product of social creation. In this study, we test the notion that the concept, profit, is fundamental to society’s perception of the firm in an emerging market, and the need for a firm to legitimise a level of profit. We evaluate the relationship between the readability of various components of corporate annual reports and the level of profit, and we also take into account the nature of disclosure (mandatory and non-mandatory), the size of the firm and the nature of setup (public enterprises and publicly listed companies). Our findings suggest that, as with developed markets, in emerging markets profit is indeed an important determinant of the nature of operations of a firm, and that firms consider readability of their disclosures in attempting to legitimise a level of profit.

Comparison of key competences of DB clients and contractors in the construction market of the People’s Republic of China

Clients and Design-build (DB) contractors are two key stakeholders in DB projects, and contribute significantly to the successful project performance. This study aims to identify and compare such key competences in the construction market of the PRC. After the survey of available literature and face-to-face interviews, a two-round Delphi questionnaire survey was conducted to identify the key competences of clients and DB contractors in DB projects. Relative importance of these identified competences were ranked and compared. The questionnaire results indicated distinct differences between the key competences of clients and that of contractors. The contractor’s key competences emphasize on DB experience, corporate management capability, building and design expertise, financial capability, enterprise qualification and reputation. While the client’s competences focus on the ability to clearly define the project scope & requirements, financial capacity, contract management ability, adequate staff, effective coordination with DB contractor and similar DB experience. Both clients and DB contractors should clearly understand the competence requirements in DB projects and possess all the necessary competences for the successful outcome of DB projects. The identification of these key competences provides clients and DB contractors with indicators to assess their capabilities before going for the DB option. Furthermore, the comparison of competences for clients and DB contractors will result in better understanding of DB system and improve the communication between these stakeholders.