DoorDash Company was founded in 2014 and is a logistic company that helps deliver goods from the buyer. This study is a global plan project for how DoorDash will enter the Indian market. The company has focused on India due to its large population, growing economy, and fewer trade restrictions. DoorDash will obtain capital from financial institutions to launch its business in the Indian market and rely on celebrity and social media marketing methods to attract customers. DoorDash is expected to start making profits in the first years due to the ready market availability in the foreign market.
Global Opportunities, Internal Competitors, Business Environment, Global Business Opportunities
India is a large country that has a wide pool of opportunities in different areas. DoorDash is a company both in the digital and transport industries, implying that it is expected to fare well in the Indian market. 65% of India’s population is 35 years and below, which implies that it can adapt quickly to new technologies such as the one used by the DoorDash app (DoorDash, 2022). High unemployment and low labor rates will favor the company too.
International Competitors
There is high competition in the Indian market for food logistics such as Deliveroo, FodPanda India, and Zomato. However, India is large commerce, and therefore, these competitors have not been able to cover the entire demand in the Indian economy. With the COVID-19, the Indian food trade is expected to grow rapidly, from $5 billion in 2020 to $21 billion by 2026 (Vijayakumar, 2021). This shows that despite the existing competitors, DoorDash has an opportunity to penetrate the market and cover the rising demand. The company structure shown in figure 1 below shall give the company a competitive advantage.
Economic-Geographic Environment
India’s economy has a high potential for business success. Its economy grows at a rate of 8% per annum (Vijayakumar, 2021). DoorDash shall benefit from this economy by having high reception of their commodity by the private firms. In addition, the Indian government has relaxed its foreign direct investment restrictions by increasing foreign companies’ foreign equity caps to appoint most of its directors. DoorDash will be allowed to employ source most of the executive employees shown in Table 1 from outside India, implying it can influence its policies. Additionally, due to India’s large geographical distance, DoorDash services will be highly reliable for both the vendors and consumers to deliver their products.
Social-Cultural Environment
Due to improved education levels, literacy ratios, and media development, Indian consumers are conscious and concerned with the products and services. The minimum working wage in India is $2.80 per day, which implies that DoorDash has to adhere to trade union demands regarding employees and give them attractive wages (Sreekumar et al., 2022). Finally, Indians have become wary about the importance of giving back to society. Therefore, they are more willing to support businesses that care for the environment. DoorDash will initiate corporate social activities that will help the community to benefit from the organization.
Political-Legal Environment
India has good political relations with the USA, sealed by signing the Indo-Pacific treaty during Trump’s administration. Their relationship is based on democratic government, the rule of law, and diversity. There is a free flow of goods between the two countries, which shows that DoorDash will not face many restrictions in penetrating the Indian market. India has a stable political and regional stability, ensuring DoorDash’s guaranteed security of their companies (Sreekumar et al., 2022). Finally, India protects its foreign investors from expropriation. Therefore, India’s political and legal environment is suitable for DoorDash as it ensures that there is security in their investments.
Global Company Structure, Financing Sources, Global Management Information System, and Managing International Finacial and Business Risks
Table 1. Role of officers. Source: (Sharma, 2018)
Financing Sources for DoorDash
DoorDash can use funds from various financing institutions, including internet banks, central banks, insurance companies, commercial banks, investment banks, and other financial institutions. These financial institutions can provide DoorDash with capital to invest in the Indian market (Vijayakumar, 2021). Another method is by borrowing money through partnerships with other firms in the Indian market. DoorDash will look for some leading food retailers and partner with them so that it can deliver food on their behalf.
Global Management Information System For Doordash
DoorDash’s global management information system will have four components, as shown in table 2 below. The first component is the database, whereby DoorDash’s information will be combined in one database. This allows quick updates, retrieval, and search for relevant information from the database. The second component for DoorDash is computing tools for easy access to the internet. All the control centers will be equipped with computing tools to help coordinate the dashers’ ordering and delivery of products. The computers will help monitor the delivery speed of the dashers and feedback from consumers to enhance efficiency in the company services.
The other component is the use of complex communication channels. These include outdoor information, face-to-face, and other public events that are purposed to increase the company’s popularity in the Indian market. For instance, the company can introduce a happy-DoorDash day where all deliveries on that day will be done for free (Sreekumar et al., 2022). The final component is information technology, whereby the company has to adapt to new trends in delivery. For instance, mobile apps in which consumers can order products are a good example of an information technology application that can be used. DoorDash will have to partner with the restaurants that deliver their foods and add their option to the restaurant’s online ordering methods. This will make it easier for consumers to realize the new service that the restaurants have introduced.
Table 2. Global Management Information System
How Doordash Will Manage International Financial and Business Risks
DoorDash is expected to face Foreign Exchange risks caused by the fluctuating currency rates between the US and Indian markets. If the Indian currency appreciates against the US dollar, DoorDash profits earned in India will decrease after exchanging dollars. Therefore, DoorDash will protect itself against such risk by hedging, whereby the company will purchase futures or other currencies in the market (Vijayakumar, 2021). This method will ensure that the company does not suffer losses after doing business in a foreign country.
The other risk that DoorDash is related to government policy changes, which may negatively or positively affect the business. Some changes can include additional quotas, trade barriers, and free trade agreements. DoorDash Company will manage these risks by acquiring political insurance risks, covering their loans and equity investments from different government actions (Vijayakumar, 2021). For DoorDash to be secure in the Indian market, it should purchase insurance to protect the business.
Product and Target Market Planning, Global Distribution Strategy, Global Promotion Strategy and Pricing Strategy
DoorDash products include the DoorDash App, self-delivery, on-demand delivery, pickups, and promotions (About Us | DoorDash, 2022). DoorDash targets restaurants, stores, and businesses that do not have the transport means to deliver meals for their client’s occasions, gatherings, meetings, and individuals. Finally, DoorDash will target the young millennials who want flexible and steady work, especially the tech-savvy males interested in adapting to the evolving digital technologies.
Global Distribution Strategy
DoorDash will use an indirect distribution strategy whereby the company uses dashers to get goods to consumers. DoorDash is already a middleman in the distribution channel; however, it also uses other middlemen by hiring dashers to deliver goods to companies. Therefore it makes it easier for restaurants to reach their consumers from the comfort of their houses. DoorDash will help restaurants to reach more customers (About Us | DoorDash, 2022). In addition, DoorDash’s global distribution strategy will offer restaurants an increment in orders due to its upsell features.
Doordash Global Promotion Strategy
DoorDash will promote its services across several social media platforms. This method will benefit DoorDash because, besides advertising, customers can ask questions about their services and give feedback (About Us | DoorDash, 2022). The other promotion strategy is the use of influencers and celebrities who have a massive following to introduce the product (Products and Partnership Plans | DoorDash for Merchants, 2022). People tend to believe their idols and follow their lifestyles. Using them to endorse the services will earn DoorDash a significant boost in the market.
Pricing Strategy
DoorDash will use a competitive pricing strategy due to the availability of high competition in the Indian market. The company will have to ensure that the prices of their products are slightly lower compared to competitors for them to gain market access. After gaining market share, DoorDash can adjust its prices to match competitors or even higher depending on their services (Vijayakumar, 2021). If their services are more quality than competitors, they will adopt premium pricing after penetrating and adapting to the market.
Financial Results, International Business Success Analysis
Figure 2 above shows the revenue in dollars that DoorDash expects to get from the Indian market. In the beginning, the company will get low revenues because it will use a low pricing strategy and have a small market share, resulting in a small revenue. However, in subsequent years, the revenues are expected to continue rising with the rising demand for online delivery services and the market share that the company will have gained.
Figure 3 above shows India’s online delivery market share rate by comparing mobile applications versus websites. DoorDash’s mobile app will give it a significant market share compared to some competitors who use websites. Therefore, the company will launch a mobile app, “DoorDash India,” which will be exclusively used by the Indian market in purchasing their products. Figure 4 shows the main cities that DoorDash will target based on their online service delivery rates.
The business’s success will be measured depending on how fast the business will penetrate some of the top cities in online food delivery in India. In addition to the revenue that the company will have gained in the market, it is important to know its market share in the market. DoorDash aims to penetrate the market of some of the highly populated cities in the market. Figure 5 below shows the projected profits of DoorDash in the Indian market.
Conclusion
DoorDash has a good opportunity of making profits in the Indian market given its good economic, social and political-legal environment. The company has a large pool of resources and can access financing to fund the expansion. To ensure their products penetrate the Indian market effectively, DoorDash should use social media and celebrity endorsements. This will enable the company to achieve positive financial results.
References
About Us | DoorDash. (2022). Www.doordash.com.
Products and Partnership Plans | DoorDash for merchants. (2022). Get.doordash.com.
RENUB Research. (2022). India online food delivery market by delivery type, companies, forecast by 2026. Journal.
Sharma, J. (2018). (PDF) The role of leadership in the management of international business strategy. ResearchGate.
Sreekumar, V., Rachel, P., & Deb, P. (2022). India’s startup explosion: more pitfalls than promise? LSE Business Review.
Vijayakumar, V. K. (2021). Beat the market in 2022 with focused investment in three sectors. The Economic Times.