El Sewedy Cables: expansion in Russia and Kazakhstan

Abstract

Purpose

The purpose of this paper is to explain the process by which El Sewedy Company in Egypt decided to expand internationally by examining several modes of entry and choosing the best choice to expand in Russia and Kazakhstan.

Design/methodology/approach

The authors did several market analyses for each company to discover the external and internal environments. In addition, they weighted the advantages and disadvantages of each mode of entry to decide on the best mode to enter Russia and Kazakhstan.

Findings

The results confirm that the expansion for El Sewedy is challenging whether in Russia or Kazakhstan. Currently, El Sewedy's strategy is to deal through distributors to minimize risk; these distributors are mostly working in Kazakhstan given their easy connections and access there. The best solution for El Sewedy to expand is to trade high voltage and medium voltage cables in Kazakhstan as well as the trade of high voltage cables in Russia. Whether it is trading, exporting or a joint venture, El Sewedy's intentions are clear in its willingness to access the Russian and Kazakhstani markets, due to their richness and most of all their location as a central trade area in the region.

Research limitations/implications

The comparison between Russia and Kazakhstan may appear very similar since both countries share almost the same circumstances and environment. Therefore, some of the information may be repeated twice to analyze both countries.

Practical implications

The results of this case study ensure the importance of analyzing the different modes of entry and doing a cost‐benefit analysis before deciding on how to expand in foreign market. Since circumstances and environments vary between markets, it is crucial to know all the details of the country in order to succeed in expanding in this foreign market.

Originality/value

This study explains a common case that happens in Egypt and every country whenever a company decides to expand. Usually, a company prefers a certain mode of entry over the other, but what is necessary is to follow what El Sewedy did, which is to evaluate all alternatives equally then decide on the best choice.

Citation

Apaydin, M., Koura, P., El Gabaly, N., Mahmoud, N. and El Noury, F. (2012), "El Sewedy Cables: expansion in Russia and Kazakhstan", International Journal of Commerce and Management, Vol. 22 No. 3, pp. 235-246. https://doi.org/10.1108/10569211211260319