Reference no: EM133136222

Fried bake and fish has long been a popular snack among locals and tourists alike in Trinidad and Tobago. One of the islands premium bake and fish shops, Richard's, which was founded in 1998 is one of the few that has opened in multiple domestic locations. By 2004 the company had four branches in Trinidad, headed up by a local Sales Manager, with more scheduled for opening in Tobago, St Maarten, Barbados and Jamaica in 2010. Subsidiaries began to be established in the Caribbean region using licensing agreements at first in the new locations, but were largely controlled from Trinidad Headquarters.

Richard's Managers were not satisfied with the pace of progress and wanted to turn the company into a more robust global enterprise with a wider customer base. To this end, the company set up its first operation in Florida, USA in 2012, again using licensing agreements initially to test the market and gain exposure, and marketed the product as Trinidad and Tobago's fast food and it proved extremely successful. With the success it became necessary to begin importing and exporting larger quantities of ingredients, including food production equipment and machinery to improve production times and quality consistency. To this end specialized machinery was customized and purchased so that an enhanced production and distribution facility could be established, where finished and semi-finished bake doughs were exported from Trinidad to the Caribbean and the USA. An International Division Manager was hired from Trinidad and Tobago, along with the transfer of several other managers from the headquarters to oversee international locations. Complimentary products were added to the menu and shipped off to specified locations without sacrificing quality. Packaging labelling and marketing materials were also purchased overseas in bulk to satisfy to cut costs.

Within two years the Florida operation was generating annual sales above the combined income of its local operations. More than 60% of the clientele were from the USA and abroad illustrating the relative ease with which some products and services such as foreign food can transfer to another country and culture. Emboldened by this success, Richards' executives began franchising its operations.

According to Mr Richard Delano, CEO, when discussing the company's international strategy he stated, "we wanted Richard's to become a global brand. In the short term the greatest returns were in the Caribbean region but limiting our product to the area would have been short sighted. Great food should never be limited by borders or cultures". As of 2005 Richard's still owned 25 of its domestic, regional and North American locations, but also franchised 25 other outlets in the USA and Europe combined. The company's expansion was also made possible by the acquisition and development of failing foreign owned businesses within the same industry where it was possible in various locations. With gradual expansion a second production and disctribution centre in the United Kingdom began to ensure European manufacturing standards were met in that region and a European operations team manager was hired to oversee its facilities with newly recruited staff. This brought positive results and service to the European market of franchisees.

Questions:

A. Identify and discuss three (3) ways a business can internationalise as evident in the case

B. Discuss whether there was centralised or decentralised decision making; explain your selection and support with evidence from the case.

C. What two (2) possible staffing orientations took place in the process of internationalising for Richard's? Identify, discuss and support with information presented in the case.

D. i. Based on the case, discuss one type of international organizational structure this company may implement when doing international business.

ii. What are two approaches to compensation that the organization may consider as an International Business for its managers.