Essays on Wales Would Be a Favourable Market for Westpac Bank Case Study

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The paper "Wales Would Be a Favourable Market for Westpac Bank" is a great example of a marketing case study.   Australian banks retained a high level of stability during a global financial crisis that led to the collapse of numerous banks in the UK and US. Data from 2015 continues to show that Australian banks are the most profitable in the developed world. The stiff competition among the leading Australian banks means that international markets offer remarkable growth opportunities. This paper examines the business environment in Wales with a view determining whether Westpac should expand to the market.

The findings show that Wales and Australia share comparable political, legal, and social environments. The economic, technological, and environment analysis has shown that an Australian bank should be successful in Wales. When it comes to the market segment, Westpac will be competing in the retail and business banking segment, with the focus being on small and medium-sized enterprises. The target market will be comprised of 1.3 million workers and approximately 210,000 businesses. Westpac’ s main competitors will be HSBC, Barclays, and the Royal Bank of Scotland as they have existing operations in Wales.

However, each of these competitors lacks a sustainable competitive advantage. As such, the paper concludes that Wales would be a favourable market for Westpac Bank. 2.0 Introduction It is an accepted fact that the global financial crisis had a devastating impact on the global banking sector. While Australian banks suffered from the crisis, they retained a high level of stability when compared to UK and US banks. This stability can be attributed to factors such as a culture of prudent lending, high levels of capitalisation, sound corporate governance, and effective regulation of the financial system (Hawtrey, 2009).

These policies allowed Australian banks to get through the financial crisis without having to receive support from the government. According to Palmer (2015), the top four Australian banks – Westpac, ANZ, Commonwealth Bank, and NAB – were ranked as the most profitable banks in the developed world in 2015. The profitability and soundness of these banks give them a strategic competitive advantage that can allow for expansion into other global markets. Indeed, Westpac serves more than 1.3 million consumers and small businesses in New Zealand through an extensive network of ATMs, branches, and online banking.

The purpose of this report will be to analyse the business environment in Wales to determine whether Westpac Bank can operate in the country. The report will also analyse the banking market in Wales, existing competitors, and Westpac’ s organisational assets and skills. The report will conclude with a SWOT analysis of Westpac. 3.0 Situation Analysis 3.1 Business environment 3.1.1 Political and Legal Analysis Multinational corporations typically enjoy strong bargaining positions when negotiating to enter new markets.

However, they lose this bargaining power and get exposed to political risks once they make their investment (Jimé nez, Luis-Rico, & Benito-Osorio, 2014). An expansion into Wales will be associated with minimal political and legal risks given that the two countries use the same political system. Australia as a whole and the UK have a long-standing relationship with the two countries sharing a sovereign leader. Additionally, Australia and Wales share the English common law system. Therefore, Westpac should expect to work under a similar political-legal environment, with the only differences being the degree of devolution.

The desire for Welsh Independence is a political factor that might affect businesses seeking to do business in the region. However, the support for independence has fallen to very low levels after the failure of the Scottish referendum (BBC 2014). The other relevant factor is the tense relationship between the UK as a whole and the European Union, which is evidenced by the upcoming referendum on the UK’ s membership of the EU. At present, Wales can be considered as part of the European Political Union that allows the free movement of capital, goods, and services.

This is an attractive factor since a multinational firm that sets up operations in Wales will gain access to the broader European market.

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