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TOPIC:INTERNATIONAL MARKETING STRATEGY

FOR „IUVAS S.R.L.” IN IRAQ

CREATED BY: MARTÎNOV MARIA


GROUP: EMREI-172
CHECKED BY: GAUGAȘ TATIANA
IUVAS has been active in textile
industry since February 24, 1998.
It is located in the industrial area
of ​Chisinau municipality, Ciocana
district, Mesterul Manole 9 street.
The IUVAS company specializes
in producing knitwear that meets
the quality requirements and the
latest trends in fashion. It is one of
the most famous knitwear
companies in the Republic of
Moldova, characterized by the
quality of the articles, the technical
endowment of the company, the
promptness in executing and
delivering the orders, qualified
personnel, flexibility, affordable
prices.
IRAQ Iraq officially known as
the Republic of Iraq is a
country in Western Asia,
bordered by Turkey to the
north, Iran to the
east, Kuwait to the
southeast, Saudi Arabia to the
south, Jordan to the southwest
and Syria to the west. The
capital, and largest city,
is Baghdad. Iraq is home to
diverse ethnic groups

Iraq's economy is dominated by the oil sector, which has traditionally


provided about 95% of foreign exchange earnings. The lack of
development in other sectors has resulted in 18%–30% unemployed
and a depressed per capita GDP of $4,000. Public sector employment
accounted for nearly 60% of full-time employment in 2011. The oil
export industry, which dominates the Iraqi economy, generates very little
employment.Currently only a modest percentage of women (the highest
estimate for 2011 was 22%) participate in the labour force.
Easier to do business indicators:  The economy grew strongly in H1
2018 thanks to elevated oil output
and prices in anticipation of
punitive U.S. sanctions imposed
on Iranian exports. Oil production
remained strong in the third
quarter, boding well for sustained
economic growth. However, oil
revenues are likely to moderate
going forward after President
Donald Trump unexpectedly
granted waivers to key buyers of
Iranian oil. This, coupled with
sustained booming U.S.
production, have both significantly
weighed on prices in recent
weeks, although a likely OPEC
output cut should stabilize prices.
Doing business in Iraq

Iraq’s economy enjoyed robust growth of more than 10


percent in 2016 because of higher oil prices and greater
financial stability. The government’s priorities are to rein in
fiscal spending, curb corruption, improve fiscal management,
and strengthen the financial sector. Combating corruption and
reducing government spending will be politically challenging;
civil service positions are used to reward loyal political allies.
Diversification, key to Iraq’s long-term economic
development, will require a strengthened investment climate
to bolster private-sector engagement, which in turn will
require improving the security environment and restoring the
rule of law.
Trade Policies
 Iraq's non-membership of the WTO means that it has few preferential trade arrangements in place and
consequently all imported goods are subject to the costly tariff regime regardless of their origin.
Access to large markets is also somewhat restricted, though agreements do exist with the EU and
some other MENA countries.
 A flat 5% import tariff has been replaced since 2016 with a multiple tariff rate regime which ranges
from 0%-80% for agricultural goods and from 0%-40% for non-agricultural goods. The opacity and
convoluted nature of the trade regime also makes it difficult for firms to calculate tariffs and increases
the risk of corruption and smuggling which damages the effective functioning of supply chains.
 A sales tax of 300% is imposed on alcohol and tobacco (cigarettes), 15% on travel tickets, 15% on
cars, and 20% on mobile recharge cards and internet. This is in addition to services rendered by
deluxe and first class restaurants and hotels, which are subject to a 10% sales tax. There is no tax
provision in the Iraqi tax law addressing excise taxes. The customs duty rates are specified in the
customs tariff and the agriculture agenda that are annexed to the Customs Duty Law.
Iraq’s business taxes
Iraq will likely experience a modest
recovery in economic growth over
the next five years. The operating
environment is increasingly
reflecting a brightening outlook for
the non-oil economy, benefitting
from confidence gains associated
with higher oil prices and efforts to
rebuild the country's damaged
infrastructure network. That said,
the country still faces significant
infrastructure gaps, legal risks and
security challenges that raise the
cost of doing business in the country
and will likely take years to resolve.
Cultural Environmnet
• POWER DISTANCE = 95 %
• INDIVIDUALISM=30%
• MASCULINITY=70%
• UNCERTAINTY AVOIDANCE=85%
• LONG TERM ORIENTATION=25%
• INDULGENCE=17%
Analysis of the industry trends in
Iraq
• The textile sector is a sector established in Iraq; offers the
following products: clothing, fabrics, leather, textiles for
medical use. The sector, although poorly managed and
endowed with outdated machinery, has a real potential to
relaunch when identifying appropriate funding sources. It is
represented by 8 state-owned enterprises:
• • State Enterprise for Wool Industry, State Company for
Woolen Industries
• • State Cotton Industry State Enterprise, State Company for
Cotton Industries
• • State Enterprise for Leather Industry, State Company for
Leather Industries
• • State Clothing Company, State Company for Ready-Made
Clothing
• • State Textile Industry, State Company for Textile Industries -
located in Wasit province
• • State Enterprise for Cotton Industry, State Company for
Textile Industries - located in Hilla
• • State Enterprise for Handmade Carpets, State Company for
Handmade Carpets
• • Baghdad Factory for furniture
Direct Investment as form of entry
List of Advantages of Foreign Direct List of Disadvantages of Foreign Direct
Investment
• 1. Economic Development Stimulation. Investment
Foreign direct investment can stimulate the target 1. Hindrance to Domestic Investment.
country’s economic development, creating a more As it focuses its resources elsewhere other than the investor’s
conducive environment for you as the investor and
benefits for the local industry. home country, foreign direct investment can sometimes hinder
domestic investment.
• 2. Easy International Trade.
Commonly, a country has its own import tariff, and 2. Risk from Political Changes.
this is one of the reasons why trading with it is quite Because political issues in other countries can instantly change,
difficult. Also, there are industries that usually foreign direct investment is very risky. Plus, most of the risk factors
require their presence in the international markets to that you are going to experience are extremely high.
ensure their sales and goals will be completely met. 3. Negative Influence on Exchange Rates.
With FDI, all these will be made easier. Foreign direct investments can occasionally affect exchange rates
• 3. Employment and Economic Boost. to the advantage of one country and the detriment of another.
Foreign direct investment creates new jobs, as 4. Higher Costs.
investors build new companies in the target country,
create new opportunities. This leads to an increase in If you invest in some foreign countries, you might notice that it is
income and more buying power to the people, which more expensive than when you export goods. So, it is very
in turn leads to an economic boost. imperative to prepare sufficient money to set up your operations.
Target segmentation
In Rep. Moldova is witnessing a special offer of industrial
goods, and it is largely due to the commodity market of
some countries, such as Turkey and China. These
goods penetrate today's market in the Republic of
Moldova. Making a characteristic of these goods, we
can say that they are of inferior quality to the native
ones, but as the price is more advantageous what
determines the consumer to acquire them. Domestic
producers can not face competition that continues to
be on the market due to the physical price of imported
products, a large range of products offered by
importers and export oriented. Approximately 80% of
the population of the Republic of Moldova does not
emphasize the quality of a product, causing an external
appearance of the product, but it increases the number
of consumers that have demanding requirements for
the product they want to purchase, which has a great
emphasis on the quality, brand, image of the company
which produces, due to the increase in purchasing
power, which, in turn, is due in the currency of the
country by those who work abroad. Namely, this group
of consumers will orient our products, they are
generally teenagers and 40-55 years old teenagers.
Price policy

Product policy
In order to obtain profits, pricing strategies of
Iuvas company do not contribute to the
achievement of image goals, nor to customer
loyalty. Also, in the context of the confectionery
market, pricing strategies are generally limited
by all costs,distribution, the density of
• Packaging
How they present products: folded in
competition and, from the perspective of the
the bag or on individual hangers. chosen target, this aspect is particularly
Each product has the label (model important .Therefore, the use of price strategies
number, size, quality), emblems will be medium.
(company logo, knit composition,
operating conditions).
Distribution policy

In Iraq there are many forms of


transportation , for our company we can
use all of them:
a. Air transport
c. Rail transport
b. Sea transport
d. Road transport
Promotion policy
In order to promote its products, the company
uses all the possible methods: Online
Promotions (Facebook, Instagram) , Point-of-
Sale Discounts ,Advertising, Television ads ,
Yellow Pages , Web pages , Collaboration or
strategic restructuring ,Special events, Special
offers, sponsorship, festivals,billboards and
others.They participate at different expositions,
national and international without other
companies from Moldova
Conclusion
In my opinion, integration of Iuvas Company in Iraq’s market, can be a
good try to develop their clothes, abroad. Because Iraq is a country
where vestimentation of people is very important due to their
religion , company can introduce their products in people’s lifestyle
and can create special clothes according to their religion standards.
Iraq is a country that after all political problems survived and now
can be considerated very stable. Also, expanding this company
abroad will increase sales in other points of sale.