Penney's Social Influences

Improved Essays
Penney’s have now decided on an attempt to penetrate the US market. This by no means is an easy task for any business. The US has proven to be a very lucrative market if one can break into the already extremely competitive market place. The US market holds both numerous attractions and causes for concern, which Penney’s must take both into account in order to continue achieving the success that they have had across Europe in the US.

The problem with politics Political influences can have an effect on the well being of Penney’s. Corporation tax in Ireland is extremely low, at just 12.5% companies located in Ireland can enjoy large amounts of untaxed income, this however is not the case in the US, at an average of 35% Penney’s can expect
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According to certain surveys 42% of Americans have penalized firms engaging in unethical behavior (Thanks, Penney’s). This will have an effect on Primark and force them to become a more credible and socially responsible business in order to achieve success. This can be seen as a disadvantage for some but can be attractive in the sense that although customers penalize this, they must therefore to do the opposite when a firm is more socially responsible thus creating respect for the business in the hope of more purchases. The USA has an enormous population, which has proved to extremely attractive to businesses (318.9 million, 2014) and this population continues to grow, in 2014 there was an average of 0.77% population growth (World Bank). This allows for an educated workforce and a wide audience of consumers. Although European fast-fashion brands have proven to be successful in the US, there are different cultural and social norms that can affect foreign businesses as they are not informed or accustomed to these different lifestyles, businesses such as Penney’s must be careful when entering foreign markets to not insult or infringe upon another’s tradition or way of …show more content…
Because Penney’s rely on a number of different suppliers the power of these suppliers is quite low, and could continue to weaken as they enter the US due to enormous competition. Competition between suppliers in America will prove attractive to Penney’s, as suppliers will continue to reduce their price in order to rise above the competition. This could prove favorable for Penney’s expansion.

Buyer Power The bargaining power of the buyer is quite high, especially when entering the US, as there are a huge number of players in the market. Primark’s main focus is to sell knock off clothing at a very low price, customers respond to this cheap incentive so if the price were to increase, consumers might be very sensitive to this change. There are substitutes available everywhere resulting in the buyer to hold power.

Competitive

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