As Lowe’s seeks new international markets to expand its highly successful home improvement model, the opportunities in the Asia market provide a unique untapped region. In Korea, recent political changes have opened its economy to foreign investors and businesses. Korea’s strong economic growth provides Lowe’s with the ideal situation of opening up stores before their competitors. Based on research I conducted, this assessment considers the potential of expanding Lowe’s into the Korean market.
With any major investment, it is important to consider the monetary and non-monetary aspects including gaining an understanding of the culture, the ideal management approach, past and future trends, along with political roadblocks.…show more content… Korea covers a land area of 99,392km (squared) and has a population of approximately 50 million people. Korea’s economy is listed as Asia’s fourth largest and the world’s 15th largest. It is the planet’s most densely populated country with 400 people per square km mainly due to the nearly 70% of uninhabitable mountainous regions. The largest cities are Busan (5.5 million inhabitants), Seoul (11.6 million), Daegu (4.0 million), Gwangju (2.9 million), Incheon (5.4 million) and Daejeon (2.9 million). Rapid urban growth has resulted in various problems for South Korea including housing. High-rise apartments were constructed in order to help alleviate housing shortages.
South Korea is the United States’ seventh largest trading partner. The U.S. is the third largest exporter to Korea with a 9 percent market share. Korea is eager to assist U.S. companies in developing the right connections/contacts within Korea through a wide range of marketing services designed to identify and arrange contact with potential buyers, retailers, distributors, and importers. The trends in Korea are favorable to a home improvement retailer entering their economy in the next five to 10 years. HOUSING DEVELOPMENT HAS DOUBLED IN THE LAST THREE YEARS: The population growth in the cities had 80% increases over the last few decades, and by 2005 81.5% of