Cultural differences are expected to exist within any cross border interactions, but so do similarities. This is to be expected between societies such as those that exist in the United States and South Africa, as this paper will endeavor to showcase. According to Hofstede, insights, power and distance are some of the differences that determine whether people accept the set order . Whether people accept others to give then directions and instructions closely relates to the hierarchy of order where we have superiors such as the top management and subordinate staff who are guided by the top management ( Stedman, 2016). South Africa has a 49 % score which means people accept the order , superiors tell subordinates what to do, and they listen and obey them ( Stedman, 2016). The US culture is different; they score a bit lower than south Africa with a rate of 40%, and they focus on equal rights where employers are not expected to just give employees orders, but they are all expected to work together to accomplish the organization goals as a team ( Stedman, 2016).
Another cultural difference exists between South Africa and the US in the level of individualism and collectivism. Collectivism in culture is where people are integrated into strong cohesive groups since childhood ; people live as extended families ( Stedman, 2016). South Africa has a rate of 65% on this, which means people are more individualistic. In individualism, we find societies in which ties between individuals are loose, and everybody is expected to look after themselves and their immediate family ( Stedman, 2016). Individuals care most about themselves and their family, and most people live as a nuclear family in a homestead with no extended family ( Stedman, 2016). Americans too are individualistic and scored even higher than South Africa with a rate of 91%. This individualism is reflected in almost all aspects of life including in the job place. Therefore, the American population is much more individualistic, and people are bound to do things based on personal needs, and without considering the needs of others.
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An aspect of cultural similarity, albeit at different levels between US and South African culture is the masculinity versus femininity aspect. South Africa has a masculine culture scoring of 63%; people are ready to do what it takes them to achieve what they want; they are competitive in nature ( Stedman, 2016). In the US, the same cultural aspect is reflected where people strive to the best they can be by working hard. In both countries this cultural aspect is masculine since such freedom also exist, with people working to obtain higher achievements in life and are ready to do what it takes. Such higher achievements could be an increase in salary or a change from one job level to a better one.
Another similarity between the cultures of the two countries is the tolerance for uncertainty. This means a society’s tolerance for uncertainty and ambiguity, how society has trained its members to perceive uncertainty as either comfortable or uncomfortable. South Africa has a score of 49%, which means they have a low tolerance for uncertainty and they avoid uncertainty, they always want to create value for their time. The US has the same culture, with a score of 46% ( Stedman, 2016).
Distribution Methods
Starbucks can use the franchises to distribute its products. Franchising is well established in South Africa, and the company can use their already established expertise to this end. Franchising is where a company gives another company its products to sell using its brand name, trade mark, and logo, and assist them with services such as training and financial assistance that can help distribute the company products ( Schindler, 2011). Also, they can use consumer retailers, who are small general dealers that are more convenient because small scale buyers like individual consumers of the beverage can buy from such retailer’s. They can also use wholesalers to distribute their products; wholesalers buy in large scale and store in warehouses, and then distribute to large scale consumers such as institutions like schools and large organizations ( Schindler, 2011).
Product/Market
For Starbucks corporation product to be selling in the market, the company should ensure that their product meets all the health standards, that it does not contain any element that can be harmful to the consumers since it is a consumable ( Hill, 2012). They should carry out research to know how they should prepare their products to satisfy consumers’ needs. Also , the company should know their target market well; if their main customers will be small scale such as individual consumers, which should direct their packaging for example, along with other elements such as ensuring that the product is affordable to their target market. I f their main customers are high end they should pack it in large sizes also to meet their needs ( Schindler, 2011).
Pricing
Starbucks Company should price their products in such a way that prices cover costs and profits, and the prices should be low so as to ensure sales, and the best way to lower prices is to lower cost ( Schindler, 2011). They can use pricing strategies like the competitive pricing strategy, where they will set their prices to match those of their competitors; this is necessary to ensure they do not set too high prices because this will lead to lack of customers and too low prices will lead to price wars with their competitors ( Schindler, 2011). Demand pricing strategy is another way they can price their products, such that people buying at large scale are sold products at a lower price than those buying smaller quantities of the product. Also, they can price their products through a cost-plus pricing strategy where the product is priced depending on their total cost (variable cost plus fixed cost) , and the desired profits are added to the total cost to get the product price ( Schindler, 2011).
Positioning
Positioning is how a company differentiates its products or services from that of their competitors and decides on the market niche they want to fill ( Hill, 2012). For Starbucks to be successful, they should establish their beverage products in a way that helps them establish its identity within the eyes of the buyer. To enable the company position itself well in South Africa they should make their beverage products unique such that the buyers can easily differentiate it from those of their competitors, and this is an element that has a lot to do with both the process of production and branding of the product to give it uniqueness (Hill, 2012).
References
Hill, M. E. (2012). Marketing strategy: The thinking involved . SAGE Publications, Inc.
Schindler, R. (2011). Pricing strategies: A marketing approach . SAGE Publications
Stedman, G. (2016). Cultural exchange in seventeenth-century France and England . Routledge.
