Opening of Rohan Stores in Iran - Assignment Example

Opening of Rohan Stores in Iran Introduction Contemporary business enterprises acknowledge franchising as a powerful tool for products distribution and marketing (Haiying, 2005). Akram et al. (2011) identify one of the essential impacts of globalization, in the global economic development, as the creation of global markets. On the same note, Olutu (2011) posits that there has been an increase in global competition due to the influx of companies into foreign nations to compete with the dominant domestic firms. Alon (2006) asserts that globalization has created a platform on which franchises view the globe as a single market and provides a platform to analyze recurrent needs across and within societies. Rohan is one such company with expansion plans. The firm seeks to open stores in Iran. It will adopt the franchise model to distribute its goods and services in its host country. Hunter and Lozada (2013) contend that franchising makes it possible to purchase a great variety of products and services from all over the world. Through the franchise model, Rohan will expand its business with independent investors or entrepreneurs. However, the firm’s owners will retain control of the business model. Baena (2012) lists the Middle East as one of the regions where franchising is emerging. Hence, Rohan will seize the opportunity by investing to grow its profit margin, create jobs, and play a part in the overall economic development of Iran. Moreover, Adizadeh (2010) affirms that many leading international companies have grown through franchising. The author further notes that franchises account for 14% of the total retail sales of the world. Rohan’s headquarters are in Milton Keynes, England (Rohan, 2015). Hence, by investing in Iran, the business will be entering a market with a completely different culture. Adizadeh (2010) states that despite the significant role that franchising has played in all economies; researchers have paid little attention to it in the Iranian market. The author further adds that there are very many barriers facing Iranian firms with considerations of adopting franchising. The barriers include legal, cultural, political, tariff, and economic. However, managers of already existing franchises in Iran affirm cultural barriers as one of the most important hindrances facing franchisors and franchisees in the country (Adizadeh, 2010). Leung et al. (2005) noted that the source of cultural barriers is the variations in cultural variables such as religion, material culture, language, social organization, popular culture, and aesthetics between the resident and foreign nations. The authors continue to point out that an increase in such dissimilarities translates to larger cultural distances between the foreign and home countries. Consequently, an increase in the cultural distances creates challenges in the process of transferring the investment from the resident country (Sarala & Vaara, 2010). However, Ewah and Ekeng (2009) identify an increase in the levels of saturation and competition in the markets of developed countries. For this reason, Rohan’s most viable solution would be developing strategies to deal with the cultural differences and, subsequently, invest in Iran as an emerging market economy. The following sections present an analysis of the marketing, finance, and management issues relevant to Rohan’s investment considerations in Iran. Marketing Analysis Weiner (2009) emphasizes how paramount it is for organizations to anticipate change and, more particularly, understand the environments that surround them. A business’ environment generates threats as well as opportunities that the firm must carefully consider throughout its operations (Krause 2013). Johnson, Scholes and Whittington (2012) contends that firms can methodically break down the environmental analysis into analyzes of the micro and macro environments. Macro-Environment (Pestle Analysis) Political factors. Saremi (2015) identifies a shift in the balance of power in Middle East following the emergence of the Islamic Republic of Iran 35 years ago following a revolution in that country. Internal power struggles and the imposition of sanctions due to links with terrorism have been characteristic of Iran for much of the 35 years (Saremi, 2015). Fortunately, the author further states that today, Iran is emerging as a model of stability especially with the consideration that a majority of its neighbors has fallen into utter turmoil. Concerning tax policies in Iran, Erfani et al. (2013) contend that the country’s taxation system us indirect and not transparent enough. They add that the law only stresses on direct tax collection on workers’ wages and employees’ salaries. The government deducts 10% tax from private companies’ revenue at a rate that varies and in accordance with the type of the company (Erfani et al., 2013). The authors further define Iran’s general sketch of the tax system shows an undesirable composition of taxes. Beigi, Rafat, and Panah (2013) conducted a study and found that tax on return has a negative effect. Subsequently, their recommendation was directors and those who program countries with poor tax systems should draw up the rate of the tax on production units more carefully. Moreover, Iran directs its tariffs at two types of commodities: those produced domestically and those deemed to be luxuries (Askari, Cummings, & Glover 1982). Hence, Rohan will be subject to tariffs since companies such as Alibaba also produce some of its products domestically. Economic factors. The Heritage Foundation (2015) presents the 2015 index that places Iran at the 171st position with an economic freedom score of 41.8. With a small economy, different global events have a significant influence on the country’s economy. Moreover, this economy comes last among the countries in the Middle East and Northern parts of Africa (The Heritage Foundation, 2015). However, The Heritage Foundation (2015) defines that as likely to change as the country’s economic freedom score has increased by 1.5 points since 2014. Specifically, there have been improvements in five of the ten economic freedoms in the country including monetary freedom, labor freedom and control of government spending (The Heritage Foundation, 2015). The country’s GDP stands at US$945.5, a value that is a one percent-five-year compound annual growth while its inflation rate is at 35.2 percent (The Heritage Foundation, 2015). Social Factors. Iran has a population of 77.1 million (The Heritage Foundation, 2015). Milani (2011) defines that different cultures and diversity in population in Iran constitute a very crucial aspect that is unknown to foreigners. The author further adds that individuals in Iran represent the Iranian culture. In addition, more than 100 different ethnic groups and religious groups live in different parts of Iran. Each of these regions has traditional dresses that are not their daily garments as was the norm in the past. Iranians have adapted to normal dresses that are congruent with other countries’ dressing codes (Milani, 2015). The author further states that Iran has four completely different seasons per year. As an all climate clothing specialist, Rohan’s products are likely to find a big market in Iran due to its diverse seasons and the shifts in the people’s culture. Technological Factors. Abbasi, Niaraki, and Dehkordi (2008) assert that since 1995, Iran has heavily invested in the telecommunication system leading to a rapid increase in the country’s number of cellular phones, telephone lines, and television and radio station. Rohan shall utilize this technological growth in its communication and transportation procedures as well as marketing its services. Legal. Hanzaee and Chitsaz (2011) states that the following legal factors influence the fashion market of women. They include the Islamic Penal Code of Iran and government policies such as Dowlat and Majilis. A majority if these regulations present policies on penalties on the Islamic Hijab (Hanzaee & Chitsaz 2011). However, some government parties accept more stylish and fashionable models based on cultural policies (Hanzaee & Chitsaz 2011). Environmental. As defined earlier, Iran has four completely different weather seasons per year (Milani, 2015). Hence, the changing weather seasons in the country will act as guidance to the products and services that Rohan will offer. Microenvironment Competition. Once Rohan begins its operations in Iran, its biggest competitor will be Jack Wolfskin Retail (JWR). JWR is also a producer of outdoor clothing and footwear with outlets in Iran (Jack Wolfskin Retail, 2015). However, Rohan will derive its competitive advantage from its rivals from the fact that it has introduced unique fabrics for clothing (Rohan Case Study for Management in Practice, 2015-2016). Customers. Rohan’s customer base will comprise of men, women, and women of all age groups. Each of these groups of people is likely to benefit from the firm’s products. Pehrsson (2008) identifies the significance of regularly examining the needs and views of the customers. Hence, Rohan will first study the problems of the customers in Iran and then design products that act as solutions, and that meet the customers’ needs. Suppliers. Rohan will mainly source its supplies from dependable firms such as Purine Baft Textile Industries Company, a leading manufacturer and seller of textile products (Purine Baft Textile Industries Company 2014). Employees. Rohan will seek to employ staff with experience and relevant skills from Iran. Moreover, the firm will purpose to have ongoing processes of training and promotions. Finance The marketing analysis of Rohan plays an important role in informing the financial background of Rohan. The information is paramount especially when discussing with the investors in Iran and showing them the potential of Rohan. For instance, the analysis shows that Rohan will require funds for the delivery of stock, warehousing, legal fees, delivery, licensing, and city permits. The franchise will cater for the remaining costs that may include rent deposit, store modeling, insurance, security system installation, recruitment, training, advertisement, and promotions. With the introduction of fabrics not previously used for clothing in this industry, Rohan is likely to be profitable in the first year. With the growth of the business’ reputation and the subsequent increase in profits, Rohan will be able to settle its debts within its first two years of operation. One of the key value drivers of Rohan is the adoption of franchising its approach of expanding its operations in a foreign country. By opting to franchise, Rohan will face fewer challenges regarding financing its business operations in Iran. Hoffman, Munemo, and Watson (2014) identify franchising as a prevalent mode of foreign market entry because it has lower transaction costs. They add that franchising allows quick expansion with a lower capital layout. Consequently, it lowers the costs required to start the business and addresses the potential risks. Since the franchisee has a partial ownership stake in the business, he or she bears a large portion of the costs and risks of market entry (Hoffman et al., 2014). The authors further add that franchising can lead to the reduction of the transactions costs of entering a new market resulting from cultural and market differences. Investors can lower costs the by utilizing local franchisees who have vast information regarding local business practices and cultural customs (Hoffman et al., 2008). For this reason, the international expansion of Rohan to Iran as a dissimilar country can be quite rapid. As Rohan considers investing overseas, it must be careful to conduct an economic analysis of Iran in order to establish such things as exchange and inflation rates. For instance, inflation might be a particular challenge in Iran due to the present sanctions that have crippled the country’s economy for long. Such sanctions may negatively affect a business’s access to finances in the country (Nzaro, Njanike, & Munenerwa, 2011). In their study conducted to establish ways in which sanctions affect financial services by studying Zimbabwe’s commercial banks, Nzaro et al. (2011) found financial and trade restrictions as the primary forms of economic sanctions that affected financial services provision of commercial banks in the country. Consequently, the restrictions resulted in the closure of some foreign accounts and failure to access offshore lines of credit. Fortunately, the case in Iran is about to change as a landmark agreement on the nuclear program in July this year could lift the sanctions by January 2016 (DiChristopher, 2015). Hence, Rohan’s entry into the Iranian market between now and next year would be less bearing on the company’s interests in accessing financial support in the country. The table below illustrates the SWOT analysis of Rohan. No. Strengths Weaknesses Opportunities Threats 1. Franchising as the mode of Entry. Inaccessibility to offshore lines of credit. Lift of sanctions in the near future. Possible closure of accounts in Iran due to sanctions. 2. A unique line of products. Challenges in accessing funding in Iran. High number of willing investors in Iran. High costs of operation due to high inflation. The findings of the financial analysis indicate that the process of finances collection can be easier and quicker for Rohan considering that it has been in the industry for long. Kotha and George (2012) affirm that entrepreneurs who have been in the industry for long enough can collect more finances from both informal and formal sources compared to the newcomers. As per the findings of a research conducted by Paul, Whittman, and Wyper in 2007, Rohan will initially seek funding from internal financial sources and their own funds, before turning to external financiers. Banks are one of the external sources that Rohan can turn to for financing. Calopa, Horvat, and Lalic (2014) contend that throughout history, entrepreneurs have mainly sourced their start-up capital from banks. A firm’s sustainability is highly dependent upon bank loans Astebroa & Bernhardt, 2003). Rohan can also try to collect its funds from informal sources such as friends and family as well as external investments. Rohan can also look for business angels in Iran. Calopa et al. (2014) define business angels as investors who assist entrepreneurs to realize their investment ideas. Among the modern methods, that Rohan can use to finance its investment in Iran, include seed camp and start-up boot camp. Calopa et al. (2014) state that seed camps are investment programs for firms in their early stages of development. On the other hand, start-up boot camps are programs that gather wide partners and networks who aid in the implementation of the business ideas (Maršić 2012). The table below presents essential figures and ratios derived from the financial reports. Ratio Analysis Statement of Projected Financial Performance (In pounds) 2016 2017 2018 Sales 400, 500 560, 400 650, 600 Cost of goods sold 150, 000 160, 000 155, 000 Net Earnings 250,500 400,400 495,600 Profits after taxes 200, 500 350, 500 440, 600 Operating expenses 50, 000 57, 400 61, 000 Current Assets 105, 000 125, 000 130, 000 Current liabilities 77, 000 81, 000 45, 000 Financial Ratios 2016 2017 2018 Profitability Ratios Gross Profit Margin 62.55% 71.45% 76.18% Operating Profit Margin 87.52% 89.76% 90.62% Net Return on Sales 50.62% 62.55% 67.72% Liquidity Ratios Current ratio 1.36 1.54 2.88 Working capital 28, 000 44, 000 85, 000 Observations and Analysis The ratio analysis is an imperative management tool that will improve Rohan’s understanding of trends and financial results. The ratio analysis also acts as a key indicator or organizational performance. It shows that Rohan’s investment in Iran projects an improvement of its profit margin within the next three financial years. The fact that Rohan has 61 stores in Europe and realizes an annual turnover of thirty million pounds is an encouragement to the potential investors in Iran. From the table above, it is evident that the gross profit margin will grow from 62.55 percent in 2016 to 76.18 percent in 2018 because of proper management of the company’s assets and liabilities. Moreover, the company’s working capital will increase over the three years as the company accumulates its profit margin and assets. Management SWOT Analysis SWOT analysis, according to Valentine (2005), involves examining the internal context of investment by analyzing its strengths and weaknesses and studying the firm’s external context to establish the inherent opportunities and threats. Many businesses embed SWOT analysis in their strategic processes to establish strengths, weaknesses, opportunities, and threats before the formation of an investment technique (Jeyaraj et al., 2012). Ommani (2011) defines a SWOT analysis as an effective framework that can help planners or researchers identify the goals of the business, make priorities, and establish their strategies further. Strengths. The most evident advantage that Rohan has over other designers and suppliers of footwear and outdoor clothing is in the fact that it has introduced imperviously used fabrics tailored to its designs. The firm’s products are special as they include shirts and trousers made from UV protection and mosquito repellant fabrics (Rohan Case Study for Management Practice, 2015-2016). Moreover, the case study adds that the company has established a system for rating their clothing’s sustainability for diverse Climatic Zones. Another strength is evident in the company’s unique marketing strategy. According to Rohan (2015), the firm is not a great fan of bling, over branding, and bull. Hence, through the company’s marketing, they let their customers know that the products perfectly fit their outside clothing and footwear needs. Moreover, since 2005, Rohan has been a member of the Ethical Trading Initiative (ETI) meaning that it takes ethical trading very seriously. Together with its clearly defined environment policy, the firm can attract the admiration of its customers by proving that it is there for a course greater than profit making. Weaknesses. One of the greatest weaknesses affecting Rohan’s quest to expand its business operations is the lack of sufficient research with information concerning the demand for outdoor footwear and clothing in Iran. Moreover, due to the current sanctions on the country, there may be a derailment on the country’s money transfer processes. In the same token, the franchise might lack sufficient funding to establish and operate its part of the business. Opportunities. Rohan operates as a specialist of clothing that is suitable for all climates (Rohan 2015). As defined earlier, Iran marks four climatic seasons every year. Hence, Rohan is very likely to have good markets for its products in each of these seasons. Additionally, as evident on their official website, Alibaba, which is Rohan’s greatest competitor, does not offer similar products to ours regarding design. Another opportunity in the Iranian market comes with the growth of technology as evident in the data presented earlier. Consequently, Rohan will have effective communication and marketing infrastructure at its disposal. Threats. The greatest threat that Rohan is likely to face in Iran is the instability of the nation’s economy. Due to the unstable economy, the consumers’ marginal propensity to consume could be low. Second, with the introduction of a new design in this sector, Rohan may find an immature market in Iran. Third, the country has incoherent policies regarding taxes and tariffs (Hatamizadeh & Gheibi 2002). As a result, the changes in the policies may often prompt the firm to change its prices unfavorably, a situation that may be unpleasing to the company’s products. Finally, the firm is likely to encounter intense competition from substitute products offered by competitors such the Alibaba Company. Management Issues Diversity in culture is one of the management issues that may negatively influence Rohan’s interests of investing in Iran (Ghanatabadi, 2005). Similarly, Rohan (2015) identifies most of its outlets as mainly in the UK and it is now that the company is planning to expand in foreign markets. Hence, it is evident that Rohan lacks the experience of international investments. Another issue related to culture will concern the transfer of knowledge from the United Kingdom to Iran. Rohan may face challenges as it seeks to recruit and train individuals who have an entirely different set of beliefs and culture. Inflation is yet another management issue that will affect Rohan’s investment in Iran. Trading Economies (2015) shows that Iran’s inflation rate in July of 2015 stood at 12.6 percent down from 16.2 in April. Such inflation rates will probably affect the currency exchange rates negatively. Management issues may also occur concerning responsibility sharing between the franchiser and the franchisee. Ekelund (2014) defines that in franchising; the transactions between a franchisor and franchisee are more complex than the traditional interactions between buyers and suppliers. Moreover, in a franchise relationship, there are certain responsibilities to retain the value of the trademark. However, Ekelund (2014) adds that the relationship is sensitive to conflicts due to dependence and power struggles between the parties. By investing in a foreign country, Rohan will face challenges in finding trustworthy employees and representatives to work in specific areas such as logistics. Lack of experience in the new country will be the primary contributing factor to this issue. Recommendations Bhardwaj, Dietz, and Beamish (2007) affirm that the cultural variables of host countries have a significant impact on the geographical location of an international company. They add that multinationals would rather venture in countries with high degrees of trust and low measures of uncertainty way. Since, Rohan will be investing in a country whose culture is different. It will have to define strategies to cope with these diversities. Some of the strategies the firm can adapt for effective operations include relocation, language, hiring, training, mentoring, commitment, team building, and communication (Panda 2010). Some of these strategies including training and mentoring can help in addressing the issue of knowledge transfer. Ogbuechi (2011) states that good pricing strategies address the shortcomings associated with high inflation markets. Companies set their prices according to their overall objectives (Ogbuechi, 2011). Similarly, for Rohan to operate smoothly in Iran, it has to define its prices in terms of survival, profits, market share, return on investment, and cash flow among other objectives. An increase in inflation will often pressure Rohan to raise the prices of its products. However, the firm should be careful not to set prices that may lead to loss of potential customers. Conclusion From the above analysis, Rohan is likely to do well if it expands its operations to Iran. Conner (2012) lists the following signs of the success of a start-up firm: the existence of validated customers, an indication of a strategic perspective, cash conservative, transparent, and proper communication. Rohan’s investment interests meet a majority of these indicators. Rohan first sets itself on the path of success by adopting the franchise model to distribute its goods and services in Iran. By investing in a foreign market, Rohan will not only benefit itself through bigger profits but also benefit the host country through job creation and economic development. By investing in Iran, Rohan will be entering a country with an entirely different culture and will be subject to political, economic, and legal barriers. However, an analysis of the other factors indicates that the risk is worth taking. After conducting an analysis of the macro and micro environments, it is evident that the motivating factors exceed the demotivating ones. For instance, Iran is redefining its reputation as a politically unstable country by emerging as a model of stability among its neighbors that have fallen into turmoil. Second, over the recent past the country’s economy has been gradually developing. Growths in the nation’s GDP is an indication that it is becoming more stable and, subsequently, attractive to customers. Third, there have been shifts in the country’s social and technological factors into those that are suitable for Rohan’s investment. The shifts have been in terms of dressing cultures and growth in technological infrastructure. An analysis of the microenvironment indicated that Rohan has a large customer base potential and that it is in a position to compete with its largest competitors. With an annual turnover of thirty million pounds per year, Rohan is less likely to face any financial constraints. Otherwise, the report identified other areas from which the firm can source its finances. They include banks, family and friends, and angel investors among others. Through a SWOT analysis, the report established the strengths, weaknesses, opportunities, and threats inherent in Rohan’s investment interests. The strengths included the firm’s unique marketing strategies while its weaknesses were such as insufficient information about the market. On the contrary, the opportunities were evident in the countries four climatic seasons while the threats included economic instability. Rohan is also likely to face some management issues that may result from factors such as diversities in culture and the transfer of knowledge from the United Kingdom to Iran. The company should adopt strategies such as mentoring and training to solve these issues. Moreover, the firm should establish effective pricing strategies to deal with the high inflation rates in Iran. References Abbasi, A., Niaraki, A. S., & Dehkordi, B. M. (2008). A review of ICT status and development strategy plan in Iran. International Journal of Education and Development Using Information and Communication Technology, 4(3), 143-154. Adizadeh, N. (2010). Adoption of franchising. Master’s Thesis 056, 7-75. Astebroa, T., & Bernhardt, I. (2003). Startup financing, owner characteristics and survival. Journal of Economics and Business, 55, 303–319. Alon, I. (2006). Market conditions favoring master international franchising. Multinational Business Review, 14(2), 67- 83. Akram, Ch. M., Faheem, M. A., Dost, M. K. B., & Abdullah, I. (2011). Globalization and its Impacts on the World Economic Development. International Journal of Business and Social Science, 2(23), 291-297. Baena, V. (2012). Master franchising as foreign entry mode: Evidences from the Spanish franchise system. International Scholarly Research Notices, 1-8. Beigi, M. R., Rafat, B., & Panah, M. (2013). The analysis of the effect of tax on profitability indices in listed companies of Tehran Stock Exchange. European Online Journal of Natural and Social Sciences, 2(3), 86-98. Bhardwaj, A., Dietz, J., & Beamish, P.W. (2007). How country cultural influences on foreign direct investment. Management International Review, 47(1), 29-50. Calopa, M. K., Horvat, J., & Lalic, M. (2014). Analysis of financing sources for start-up sompanies. Management, 19(2), 19-44. Conner, C. (2012). 5 sure signs a startup will succeed. Forbes.com. Retrieved from http://www.forbes.com/sites/cherylsnappconner/2012/07/12/5-sure-signs-a-startup-firm-will-succeed/ DiChristopher, T. (2015). Iran may soon be open for business, but not to U.S. firms. CNBC. Retrieved from http://www.cnbc.com/2015/07/17/iran-may-soon-be-open-for-business-but-not-to-us-firms.html Ekelund, C. (2014). Franchisor-franchisee relationships: An interaction approach. World Journal of Management, 5(1), 76-92. Erfani, H., Rahbari, S., Heydari, A., & Shahhosseini, F. (2013). The study of the factors that influence on the performance of value added tax system in Iran. Singaporean Journal of Business Economics, and Management Studies, 1(6), 1-8. Ewash, S. O. E., & Ekeng, A. B. (2009). Problems and prospects of marketing in developing economies: The Nigerian experience. International Journal of Business and Management, 4(9), 187-196. Ghanatabadi, F. (2005). Internalization of small and medium-sized enterprises in Iran. Doctor Thesis, 1, 1-300. Haiying. Z. (2005). Fast food in a Chinese Provincial City: A Comparative Analysis. A Thesis, 20–48. Hanzaee, K. H., & Chitsaz, S. (2011). A review of influencing factors and constructs on the Iranian women’s Islamic fashion market. Interdisciplinary Journal of Research in Business, 1(4) 94-100. Hoffman, R., Kincaid, J., & Preble, J. (2008). International franchise expansion: Does market propinquity matter? Multinational Business Review, 16, 25-51. Hunter, R. J., & Lozada, H. R. (2013). A primer on franchising in the United States: A vehicle for economic mobility. Global Journal of Management and Business Research Economics and Commerce, 13(4), 1-10. Jeyaraj, K. L., Muralidharan, C., Senthilvelan, T., & Deshmukh, S. G. (2012). Application of SWOT and principal component analysis in a textile company-A case study. International Journal of Engineering Research and Development, 1(9), 46-54. Johnson, G., Scholes, K., & Whittington, R. (2012). Fundamentals of strategy. Prentice-Hall: Harlow. Kotha, R., & George G. (2012). Friends, family or fools: Entrepreneur experience and its Implications for equity distribution and resource mobilization. Journal of Business Venturing, 27, 525-543. Krause, J. (2013). Effects of macro-environmental factors: Running a micro distillery in the Czech Republic. Food Science and Quality Management, 16, 24-27. Leung, K. Bhagat, R. S. Buchan, N. R., Erez, M., & Gibson, C. B. (2005). Culture and international business: Recent advances and their implications for future research. Journal of International Business Studies, 36, 357-378. Maršić, I. (2012). Startup bootcamp guide: How to be on the right spot, in the right time with your startup. Retrieved from http://www.netokracija.com/startupbootcmap-vodic-26166 Milani, S. (2015). Diffusion and consumption of fashion among Iranian youth. Major Thesis Spring 2011, 4-92. Nzaro, R. Njanike, K., & Munenerwa, E. (2011). The impact of economic sanctions on financial services: A case of commercial banks in Zimbabwe. Journal of Contemporary Management, 104-110. Ogbuechi, A. O. (2011). Pricing Strategies in high-inflation markets: Implications for the multinational corporation. Journal of Applied Business Research, 9(1), 44-49. Olutu, O. A. (2011). Reinventing business growth through franchising in developing economies: A Study of the Nigerian fast food sector. A Study of the Nigerian Fast Food Sector, 3(1), 162-170. Ommani, A. R. (2011). Strengths, weaknesses, opportunities, and threats (SWOT) analysis for farming system businesses management: Case of wheat Ffrmers of Shadervan District, Shoustar Township, Iran. African Journal of Business Management, 5(22), 9448-9454. Panda, S. (2010). Managing cultural diversity-strategies for organizational success. Journal of Contemporary Research in Management, 9-17. Pehrsson, A. (2008). Marketing strategy antecedents of value adding by foreign subsidiaries. International Marketing Review, 26(2), 151-171. Paul, S., Whittman, G., & Wyper, J. (2007). Towards a model of the business angel investment Process. Venture Capital, 9(2), 107-125. Sarala, R. M., & Vaara, E. (2010). Cultural differences, convergence, and crossvergence as explanations of knowledge transfer in international acquisitions. Journal of International Business Studies, 41, 1365-1390. Saremi, F. (2015). Is Iran the most stable country in region? Counterpunch. Retrieved from http://www.counterpunch.org/2015/01/30/is-iran-the-most-stable-country-in-region/ Trading Economies Iran Inflation Rate, viewed on 2 October 2015 from http://www.tradingeconomics.com/iran/inflation-cpi The Heritage Foundation. (2015). 2015 Index of Economic Freedom. Retrieved from http://www.heritage.org/index/country/iran Valentine, E. K. (2005). Away with SWOT analysis: Use defensive/offensive evaluation instead. The Journal of Applied Business Research, 21(2), 91-105. Weiner, B. J. (2009). A theory of organization readiness for change. Implementation Science, 4(67), 1-9. Appendix: SWOT Analysis Valuable in achieving objectives Detrimental to achieving objectives Internal factors Strengths Unique design: fabrics tailored to its designs. Special products: shirts and trousers made from UV protection and mosquito repellant fabrics System for rating their clothing’s sustainability for diverse Climatic Zones. Unique marketing strategy. Ethical trading Weaknesses Lack of sufficient research. Derailment on the country’s money transfer processes. Lack of sufficient funding for the franchisee. External factors Opportunities Four climatic seasons every year in Iran. Little competition. Growth of technology Strengths Instability of the nation’s economy. Immature market in Iran. Incoherent policies regarding taxes. Substitute products. Read More