Indonesia years it can cause quite a lot

Indonesia as
compared to Greece:

Political:

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Indonesia is
democratic and therefore there should be little difference in leadership methods,
however Indonesia has also has a vice president and they are both elected every
5 years. Also, the president has a cabinet which is the members of are
appointed by the votes of the public.

Indonesia is an independent country however it was a vassal
of japan until 17th of August 1945. Since then it celebrates its
Independence Day on that day.

The country has been politically stable for quite some time
and should remain so due to their economic agreements which heavily rely on it.

Tesco will have to ensure that they do not offend the
political leaders by using the incorrect terms. Tesco will have to be aware of
who the president is and who the vice president is, then ensure that they do
not offend the political standing of the country as well as determine how
stable the political standing is, since the president changes every 5 years it
can cause quite a lot of problems and risk to the country’s standing during the
elections.

 

As compared to Greece which has a Prime Minister which is
the head of the country and a multi-party system. The president hold no real
power as the Prime Minister hold executive position. The public has created a
lot of instability due to their disapproval of the government’s actions and it
is difficult for them to settle this matter.

Tesco would have to consider these when attempting to enter
the market as very little stability can be promised by the government in the
current state of matters.

Both Indonesia and Greece are not so different as they both
have elected leaders and are democratic, however there is a lot more
instability in Greece as compared to Indonesia.

Economical:

Indonesia is a developing country and it is currently
working on increasing their GDP, this has been done through government spending
equal to 23.5%. This in turn has brought an 6.1% improvement in GPD growth.
Indonesia has $92.62 billion in revenue and $98.88 billion in expenses.

Indonesia possesses
reserves of crude oil and natural gas and is 8th in the world in
exporting it.

GDP makeup:

·        
48.1% from industry

·        
14.4% from agriculture

·        
37.5% from service sector

 

In 2016, Indonesia exported $140B and imported $132B,
resulting in a positive trade balance of $8.07B. In 2016 the GDP of Indonesia
was $932B and its GDP per capita was $11.6k.

Imports:

Products mainly imported: chemicals, fuels, equipment,
machinery and foodstuff.

These goods are usually imported from: China, Japan, South
Korea, Singapore, Malaysia, Thailand and US.

Exports:

The major exports are oil and gas, electrical appliances,
rubber, textiles, and plywood to countries like India, Malaysia, China, Japan,
Singapore, US and South Korea. However, the top profitable exports of Indonesia
are Palm Oil ($14.4B), Coal Briquettes ($11.9B), Petroleum Gas ($6.22B), Crude
Petroleum ($4.93B) and Jewellery ($3.97B).

The top most profitable export destinations of Indonesia are
China ($16.8B), the United States ($16.2B), Japan ($16.1B), Singapore ($11.2B)
and India ($10.1B). The top import origins are China ($32.1B), Singapore
($25.8B), Japan ($11.3B), Malaysia ($6.67B) and South Korea ($6.61B).

Indonesia borders
Malaysia, Timor-Leste and Papua New Guinea by land and Christmas Island, India,
the Philippines, Singapore, Thailand, Vietnam, Australia and Palau by sea.

Currency:

Symbol: Rp

Inflation: 3.83 %, February 2017

Central bank: Bank Indonesia

Rarely used: Rp. 1000

ISO 4217 code: IDR

1 US Dollar equals 13520.00 Indonesian Rupiah

Unemployment rate: 5.5%

 

Tesco will have to work in the Indonesian Rupiah currency
which can be very difficult and therefore it should be prepared to do so as the
currency exchange will be a major factor in calculating profits. Furthermore,
the country appears to have good economic stability and Tesco wouldn’t be
taking much risks in doing so.

 

As compared to
Greece which has had the GDP of $194.559 billion per annum it is a much lower
value, however the country has a lower inflation rate of only 1.0%. And with a $26,800
GPD per capita it would appear as if the individuals are richer than in
Indonesia. Greece however has 0% GPD growth rate and an unemployment rate of 23.6%
which is much higher than the one Indonesia.

In which case Tesco will have to consider the market
instability, as it is a much smaller market there is little to be gained from
it and Tesco will probably need to adjust not to waste money to saturate a
market that has little potential.

 

 

*Social:

Indonesia has a very
large population which is steadily increasing with the ratio of 1.13%. The
country has a good average life expectancy which is over 70 years of age and
most of its residents live in urban areas. Mostly the residents are involved in
agriculture and industry. The government has recently prioritised its education
due to its outstanding literacy rate of 90.4%. 3.4% of the GDP is spent on
education. The Government possesses its own public schools and colleges as well
as universities.

Majority of the population is Muslim, then Protestants,
Roman Catholic and Hindus.

Tesco would have to
adjust their stores to be able to fit more people as people in Indonesia like
to take their time shopping and there is a lot of them. This means that more
space for people should be allocated.

As compared to Greece which do not put as much pressure om
personal space as most countries do, it would be a difficult point of entry as
most business dealings in Greece are based on personal relations, this means
that Tesco might struggle to find suppliers to begin with and that the
beginning might be difficult, however Greeks are easier to build customer
relations and this should be prioritised.

*Technological:

Indonesia has
developed their own transport system with roads, ports and airports, railways
and water ways are the main way to go to other parts and islands of the country.
As it is located in the ocean.

This country has developed its communication system and numerous
new brands of smart phones are available there. People prefer to use landline and
cell phones but they also use the internet. There is a very small crime rate. They
have their 54 TV channels in which 11 are national TV networks and some are in
the private sector.

Tesco will have very
little to no barriers to entry from the technological standpoint as Indonesia
has many if not all of the currently modern technology, this allows Tesco to
even purchase it there as many are made locally.

Greeks also have access to modern technology and are
utilising them for their use however, the economic problems which Greece is
currently facing had a very negative impact on the growth of the use of
technology and the country is currently struggling to keep up with the newest
technology available.

Tesco will have to import some of the newest technology if
it is necessary which could increase the costs but besides that there is a lot
of potential to utilise technology and especially use it for marketing
purposes.

 

*Legal:

Indonesia has introduced new rules and regulations in the
country. New labour laws are introduced. These laws show the 7 hours workdays
and 40 hours workweeks. When labour works for 4 consecutive hours, then 30
minutes break is permitted to them. The government also introduced the company
law and every business has a legal entity and they have directors and
commissioners. The government announced the environmental law and the Municipal
Noise Reduction plan is underway to change the noise limits in the residential
areas, hospitals, schools and religious places. In the business sector, the tax
system is introduced with various changes the tax, on first 25 million is 10%
and on next 25 million, its rate is 15% and next 50 million, the rate of tax is
30%. The income tax is applied to the businesses and on the individuals.

Tesco will have to adjust to
the tax changes and this can be quite expensive for Tesco, it will probably
decrease the profit margins made by Tesco and increase the prices. Tesco might
have to look for new supliers to reduce their costs. Teso will have to ensure
that they are allwing their employees accurate breaks and this can reduce
productivity but other than that the country is reasonably simmilar in how it
handles it’s law.

Greece however has very
rigorous laws on piracy and sale of potentially dangerous items, this should be
considered when purcahsing anything as it is always a good idea to have a
receipt to avoid legal problems and potential theft charges. Some products that
would appear to be acceptable in the UK are classed as illegal weapons in
Greece and therefore Tesco will be unable to sell them there.

 

*Environmental:

The geographical
location of the country is very fascinating as this country is mostly contained
of thousands of the islands and it is located between Indian and Pacific
Oceans. It is a hot and a humid country and the is a lot of moist round the
year.

It is composed or rain forest and swamp as well as some
snow-capped mountains. There are many active volcanoes, which can create a
natural disaster in the country at any time. The earthquake of 9.0 magnitudes
caused the tsunami in the country in 2004 and it claimed 155,000 lives. It also
faces deforestation as massive forest fires are a danger. The forest fires
affected the timber industry badly and it caused heavy losses to the country.

Tesco will have to be careful not to lose their investments
to a natural disaster, it might be a good idea to spend some money on
monitoring the local environment as it can save both lives and money.

However, Greece is mostly covered in mountains and has a
very large seaside, it gets very rainy in the winter and very dry in the
summer. The environment however is less dangerous and more stable, the
occasional natural disasters aren’t frequent and it can be considered a safe environment.

Tesco would have to prepare for the rainy and slippery
environment in the winter when considering their transport routes but other
than that Tesco should be able to feel safe about their standing with the local
environment.

 

*Ethical:

Religious beliefs of the Muslim religion are the ethical
aspects of the country as it is their dominant religion, however others are
dictated by the Roman-Dutch law structure that the country has inherited.

Tesco will have to adapt their goods and services to meet
the demands of the customers and ensure that the products sold comply with the
Muslim religion. If not, the business can become exempt and banned from trade
in the country.

Greece on the other hand is very welcoming to strangers and
their customs, this means that little to no changes will have to be made,
however in Greece distrust in other is seen as wrong.

Tesco will have little to no difference in how they should
approach business in Greece however Tesco will need to consider its customers
trust in them and vice versa.

 

Section two:

 

Language:

Indonesia is a country with over 300 native languages and
more than 600 are spoken there however the top three languages spoken in the
country are Indonesian, Javanese and Sundanese.

Tesco will have to
hire translators and potentially spend a lot of money in the process of
translation.

Greece however mainly uses their language “Greek” it is
spoken across the country and it is very rate to find another language used.

Tesco will also have to hire translators and this can be
quite expensive.

*Customs:

Most of the customs in Indonesia are the customs of the
Muslim religion and therefore they are simply based on the current customs that
the religion has introduced.

Tesco will have to ensure that they do not fail to uphold
these as religion is very important in Indonesia and can restrict their trade
in Indonesia.

Greece however has a custom of making a grand celebration of
baptism and therefore it is the most important celebration in a Greek’s life,
this is also due to their religious beliefs.

Tesco will have to ensure that they do not offend this
custom and its value to the Greek citizens as it could become a scandal if
Tesco has accidentally done so.

*Values:

·        
Religious commitment and the belief in the one
and only God.

·        
Just and civilised
humanity.

·        
The unity of Indonesia.

·        
Democracy guided by the wisdom of deliberations
among representatives.

·        
Social justice for all the people of Indonesia.

Tesco will need to uphold these values when conducting
business in Indonesia as it can be seen as disrespectful and vulgar if done
otherwise. This can be very difficult as Tesco might be unaware of the
religious values and might have to hire staff to be cautious of it.

Greece has also got a lot of religious values which mainly
concede in the journey to become a man worthy of their divine’s grace and affection.
The people of Greece also value their “love of strangers” which means to
respect the people you meet.

Tesco will need to ensure that they do not restrict any man
or woman from prayer or religious practises while there. Tesco will also have
to respect every citizen and refer from potential acts of offence.

*Attitudes:

The individual’s
standing is purely based on birth and the family to which one belongs to, the
hierarchy in the country is based on your family’s status and the links that
the family creates with other families that define your title and place. The
whole of the Indonesian society is a web of such family obligations to one
another.

Indonesian law forbids weapons, illegal drugs or pornography
in the country.  Consequences can be
severe as they include death for weapons or drugs. This is all due to their
beliefs as they do not wish to be exposed to the outside world’s problems.

Their attitude to woman is rather poor due to the religious
beliefs women are seen as less equal to men. However, they are allowed to work.

Tesco will have to ensure that they do not do any of the
related to maintain a good reputation. Tesco might have to apply themselves to
some of these and limit their product portfolio, however this will help the
business avoid legal action or loss of reputation and angering the citizens.

As for Greece, their attitudes are very similar to the ones
in the UK as they are a part of Europe and they have a set of laws that govern
the public attitudes, furthermore it is common knowledge that the attitude of
the Greeks to foreign businesses and foreigners is very good and should be and
inspiration to other countries.

Tesco will however have to adjust to their religious
attitudes as offending their religion can be done quite easily and there is
little tolerance for that.

 

Religion:

In Indonesia, the Muslim religion holds absolute power and
must be followed at all times, it has more power than the government and
therefore if the religious figures demand it laws and pretty much anything else
can be abolished by it.

Tesco will need to
ensure that they comply with the religious customs and guidelines in order to
Trade in Indonesia, Tesco might also want to hire a religious matters advisor.

Greeks are also very dependent on their Religion, the Greek
Orthodox. This religion is highly dominant and hold a lot of power, Tesco will
need to ensure that they do not get in the way of the local religion and it can
critically harm their reputation not just in one country.

*Manners:

In public showing Bluntness is rude, loudness is vulgar, and
aggressiveness is bad manners. As well as saying “No” is seen as an aggressive
response so avoiding that direct negative approach is very important as Indonesians
are sensitive to nuances of speech and expression.

Time is of little meaning as the country takes everything
slowly and nothing is to be hasted as it is seen as vulgar to do so.

Foreigners are
welcome but might attract a lot of curiosity and attention when outside of
common tourist locations. In most of Indonesia, what to wear is largely determined
by the Muslim code of dress. In general terms, this means that most of the body
should be covered. Clothing should not be tight fitting or revealing. In
practical terms, shorts may be worn by children, bather, and for sport, but not
in the street. In private you can wear what you like and in tourist areas and
beach resorts scanty clothing is accepted.

In Indonesia taking pictures of rituals or individuals can
be viewed as mockery and should be avoided.

Tesco will need to prepare a set of guidelines for their
employees of what correct manners are and how to behave in a manner which ill
not offend the people of Indonesia.

The Greek people are used to asking personal questions without
knowing the other person for long, personal space is of little to no concern to
them and they are likely to approach and invite stranger to meet their families.
Being about 30 minutes late to attend to someone’s house is considered normal
and a small gift is expected, this can be in a form of flowers, cakes or chocolates.
If invited to dine out is might be a good idea to ask to pay but it is unlikely
to be approved, insisting however can be viewed as rude.

Tesco will need to prepare a set of guidelines for their
employees of what correct manners are and how to behave in a manner which ill
not offend the people of Greece.

Education:

The government has
introduced a variety of religious schools and colleges as well as some
universities, they are all allowing both men and women to attend however the
education provided is purely religion based and includes languages, however
attending certain courses by women and men can be viewed as outrageous and can
cause conflict if done so. Women are still disadvantaged as they are mainly
only allowed to study religion and anything else is very gender biased as well
as their education level is lowered as compared to what the men are learning.

Tesco will need to respect the government’s decision and do
not intervene in the educational system. If possible include an education
section which will hold local customs in education when displaying the products.

In Greece education
is freely available both in the public and private sector, both schools and
universities do not charge the students any tuition fees and textbooks are available
for free to all students.

Tesco will need to ensure that the follow the codes of
practice and legislation when selling school equipment and also ensure that all
products meet the education standards.

Material Culture:

The culture is based on the Muslim religion and the word of
religious figures means more than any law. This means that any cultural aspects
of the country are of the religious type.

Tesco will need to research the current impact on how the
religion affects this and make accurate changes at all times, this can be done
over time to avoid collision with the local religion.

Institutions:

Indonesia has many
religious institutions however they have very little of any other types, as
there is very little crime in the country it is not common to see any law
enforcement, they also have fully modern fire departments all over the country
and a few hospitals however they are modern and very spacious.

Tesco will be able to make use of the local institutions if
there is a need as they are both trained well and due to usually low demand it
should be rather accessible.

Infrastructure:

The country has a
very large amount of ports, however it is mainly islands and roads can be
difficult to find outside of the populated areas. Airports are also quite
common as due to the structure of the country and the many islands that it is
made out of, it is impossible to use trains or land transport alone to
transport any goods outside the country.

Tesco will be able to use the existing infrastructure and
build more if the wish to do so, however there should be little need for this
as the current one quite large.

Greece has a good infrastructure
in most places however, this is not the case in the mountain areas as in some
areas of the country it can be very difficult to transport goods and new or
improved infrastructure will have to be built.

Tesco shouldn’t have to build any new infrastructure unless
they chose to operate in less developed and less populated areas. The current infrastructure
is more than capable of dealing with the extra demand.

Work Attitudes:

Both women and men are allowed to work, however women are
not allowed to hold any important roles and time is of no essence in the
workplace as everything is delayed for religious and cultural purposes which
are one and the same.

Tesco might have to make so changes to how their recruitment
and selection process is carried out as well as look at different methods to
promote staff.

 

 

 

 

 

 

Konrad Kostrzewa

 

Bibliography

References:

Dr. Thorsten Schneider. (2018). Exporting to Emerging
Countries – Opportunities and Challenges. online Available at:
https://www.liverix.com/exporting-emerging-countries-opportunities-challenges/
Accessed 9 Jan. 2018.

Free PESTEL Analysis. (2017). PESTLE-PESTEL Analysis of
Indonesia. online Available at:
http://freepestelanalysis.com/pestle-pestel-analysis-of-indonesia/ Accessed 22
Nov. 2017.

Landed, J. and Landed, J. (2018). Diversity, religion and
values. online Just Landed. Available at:
https://www.justlanded.com/english/Indonesia/Indonesia-Guide/Culture/Diversity-religion-and-values
Accessed 9 Jan. 2018.

Rough Guides. (2018). Culture and etiquette | About Greece.
online Available at:

Culture and etiquette


Accessed 9 Jan. 2018.

Scribd. (2017). PESTEL Analysis of Indonesia | Association
Of Southeast Asian Nations | Indonesia. online Available at:
https://www.scribd.com/doc/33325854/PESTEL-Analysis-of-Indonesia Accessed 22
Nov. 2017.

Tripadvisor.com. (2018). Indonesia: Customs – TripAdvisor.
online Available at:
https://www.tripadvisor.com/Travel-g294225-c2418/Indonesia:Customs.html
Accessed 9 Jan. 2018.

Sources:

https://www.justlanded.com/english/Indonesia/Indonesia-Guide/Culture/Diversity-religion-and-values

https://www.tripadvisor.com/Travel-g294225-c2418/Indonesia:Customs.html

Culture and etiquette

https://www.liverix.com/exporting-emerging-countries-opportunities-challenges/

 

 

 

 

 

 

 

 

 

 

 

Briefing Pack

Operating Internationally

 

 

 

 

 

 

 

 

 

 

 

 

                                                                                                             By Konrad Kostrzewa