Research and Market Entry Report for Austria Krystian Raymond



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When developing a pricing strategy for a new market, there are four essential points that an organization must consider: "anticipated demand for the product or service; perceived value of the product or service by the customer; ability of the customer to pay a certain price; and price offering of the competition for a similar product or service."[FIT135] By modifying its product line and pricing to target underserved segments within the home improvement markets, RONA can maximize the demand for its retail products as well as counter competition effectively. Offering higher-quality products within the market and focusing on a specific customer base allows RONA to create higher perceived value for its goods and services. A worker in Austria makes $9,000 USD more per year than the OECD average for member nations. [OEC13] As inhabitants of the 13th richest country in the world, Austrians have a significantly higher ability to spend than the average citizen in the developed world.[CIA13]


Target Market and Consumer


As Austria has roughly a similar climate to Canada, RONA can expect comparable seasonality concerns within its product and service offerings. “First quarter and last quarter sales are typically weaker than sales in the other two quarters, due to the low level of activity in the renovation/construction sector in winter. In addition, bad weather can impact sales, particularly those of seasonal products.”[RON14] As RONA has extensive experience in operating in a seasonal type of industry, it can be seen as an asset as the company moves forward with its international expansion. RONA has good knowledge of how to manage its product mix throughout the year and has strategies in place to maximize its profitability throughout all seasons. Good supplier relationships allow RONA to have the flexibility to change and adjust its product mix regularly without compromising its product line over the short or long-term.



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