Bond communications' strategic decision to open a branch in Qatar

Abstract

Bond communications founded in 1989 in Abu Dhabi, UAE, acts as a system integrator and solution provider company (Full Extra Low Voltage System). By 2006 it managed to take its part from the Burj Khalifa, the tallest man-made structure on Earth after implementing projects like Burj El Arab and other prestigious projects in the UAE. Nowadays The Company has the knowhow, capacity, power and reputation to remain a well established company in the UAE. With an estimated 500 Million AED turnover in 2007, Bond Communications easily overshadows its competitors. In 2008 the company was racing ahead of its competitors to secure in the UAE the coveted title of "Premier IT integrator". Nevertheless, The Company still faces today competition from the rapidly growing markets in Qatar, Bahrain and other neighboring countries. Facing the tremendous demands resulting from the rapid GCC economic growth, Bond Communications is naturally forced to enter these and other new markets to solidify its competitive position. Tough and complex questions need to be answered and analyzed before making strategic moves into new markets. This case study is intended to explore major challenges and opportunities that may either inhibit or facilitate the Company's entry into these rapidly growing emerging markets. The analysis may assist in examining and recommending target markets where The Company can expand successfully. A Political, Economical & Socio-Cultural analysis will be conducted to specifically analyse Qatar's market, assessing the country's internal and external environment, as well as its competitive advantages and barriers in order to pave the way for the Company's successful entry into this new market. Analysis will include ideal model to adapt, condition of The Company's readiness and the new market's current issues. Conclusions of the research conducted suggest expansion into a new market such as neighboring Qatar while adapting the Uppsala-model during the expansion process. The Qatari market was selected based on its current and future potential as well as its proximity to the much larger UAE market where the Company dominates. In the increasingly global society, many companies can no longer pretend to live under the illusion that their domestic markets will be sustainable forever. For this and other reasons, courageous companies choose to expand into other countries. In this case, The Company has decided to take an equity position within an already established Qatari company forming an equity joint venture. It is strategy will help Bond Communications offset the typical cyclical fluctuation of its sales while accelerating growth and maximizing profit. The anticipated success of this strategic move is based on real case scenarios including: Mode of Entry, Resources committed and the risk factors identified during the Internationalization process.