ISLAMIC UNIVERSITY

BANGLADESH

An Assignment

On

Launching Cloths in USA

Course Name: International Business
Course Code: MKT-322
Department of Marketing
Islamic University,Kushtia

Date of Submission: 20-02-2022

ISLAMIC UINVERSITY,BANGLADESH
Launching Cloths in USA
Course Name: International Business
Course Code: MKT-322
Prepared for
Md. Sadiqul Azad
Assistant Professor
Department of Marketing
Islamic University,Kushtia

Prepared by

NAME ID GMAIL
MURSALIN B-1725003 saiyadul.mursalin.iu@gmail.com
MD. MEHEDI HASAN RESVEY S-1725015 Resvey123…@gmail.com
MANSUR AHAMED TAMIM Z-1725032 monsurahmedtamim@gmail.com
RIEAD SIDDIQUE L-1725055 riyadsiddiki2020@gmail.com
SADIA AKTER F-1725056 sadianidhi12345@gmail.com
MD. TANJER HOSSAIN RAZU R-1725070 localman420@gmail.com

Date of submission: 20th February 2022

 Table of Content
Abstract .......................................................................................................................................... 2
Product lines .................................................................................................................................. 2
Host Country Selection .................................................................................................................. 3
Reasons behind selecting Sweden as our host country ................................................................ 3
USA imports huge amount of cloth products .............................................................................. 4
Stable and innovative Economy ................................................................................................... 5
Analyzing Doing Business Report ................................................................................................5
Risks and Limitations ................................................................................................................... 6
Manufacturing Payroll, ....................................................................................................................................... 6
Growing capital control ............................................................................................................... 7
The Hidden Costs of Offshoring .................................................................................................. 7
Tax Incentives ............................................................................................................................... 7
• Lower Tax Rate ............................................................................................................ 7

• Tax Exemptions............................................................................................................ 7
• No Withholding Tax: ...................................................................................................................7
Easy Incorporation Process ......................................................................................................... 8
Purchasing Real Estate ................................................................................................................ 8
Related Agencies ........................................................................................................................... 8
Financial Assistance ...................................................................................................................... 8
Trade Barriers in USA ................................................................................................................... 9
Administrative Barriers ..................................................................................................................9
Subsidy ........................................................................................................................................... 10
Joint venture .................................................................................................................................. 10
Increasing corporate tax ............................................................................................................... 11
High standard of living ................................................................................................................. 11
The Impact of Cultural Differences on The Brand .................................................................... 12
Adapting the product for local customers ....................................................................................12
Promotional strategies ................................................................................................................... 12
Target Market Selection................................................................................................................. 13
Why joint venture ...........................................................................................................................14
Conclusion ...................................................................................................................................... 15
Reference ........................................................................................................................................ 15

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Abstract
We are choosing the clothing products that's very potential to USA market. We expected that this clothing
products huge demand based on the production of trendy design, fashionable, up-to-date, comfortable &
reasonable prices following the last trends of materials & colors.
This producs are giving focus on making a high-quality products create new designs of new models every
year, in order to surprise & satisfy there customers.

We are developing any customize design for buyers that they want. The buyers selected the design and
quantity that they want to buy and delivery according to commitment.

Those producs are manufacturing a distinctive product, which is distinguished for being stitched by the
expert hands of their in house artisans & for using 100% natural & ecological materials. Every little detail
is considered in the manufacturing process in order to deliver this wonderful product.
This produc is vast range of innovative products, backed by a robust supply chain and distribution network,
makes it truly a household brand in Bangladesh. Its growing presence outside of Bangladesh. Through fair-
trade networks and the online shop– continues to broaden the market for Bangladeshi crafts globally,
creating more opportunities for artisans to protect their age-old art and livelihoods.

This sector is properly addressed, Bangladesh can increase there market share in readymade garments
experts to 10 percent in four years.

Our Products

Women’s Products

- Traditional
- Western
- Nightwear
- Shawls/Scarves
- Shoes
- Bags
- Fabrics OUR BRAND
NAME

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 Men’s Products
OUR BRAND

- Traditional
- Executive Shirts
- Maanja
- Fotua
- Short Kurta
- T-Shirts
- Stoles/Shawls
- Sandals
- Childre

Children’s Products

- Clothes
- Toys
- Books OUR
BRAND
- Shoes NAME

Host Country selection:

We have decided to launch Our Cloth products in USA. As USA people love to wear classy and
posh dress. In Cloth there is various kind type pf cloths that their people must be would love to
wear it. Since 2010 there 50,677 people Bangladeshi people lives in USA. Now it increases much
more, yet people did not count it. In every year USA import cloth from BD import US thousand
5688721.53 and import product share avg in 89.9% .so that’s why we choose USA. And we will
go with H&M as a joint venture. Because we all know that H&M export lots of cloths from
Bangladesh. Basically, upon on this why we didn’t use this opportunity for making good relation
and increase our GDP growth.
Reasons behind selecting USA as our host country:

We all know that there main lacking is labor cost. In USA their labor cost too high from our country
so they use our labor for their making own cloth at cheap cost. In USA H&M brand use our local
garments for making it at cheap cost. So our product decided that if they use there value why we
didn’t .so we will also provide our traditional dress in USA in H&M sector .and if we go with join
venture we will take it as an advantage for trade applying and Their standard of living and life
expectancy are almost second to none and USA regularly finds itself at the top of the lists ranking
business climate, sustainability, global competitiveness, language skills, productiveness and
innovation – the latter with a performance well above that of the EU average. USA business
procedures are simple and efficient, built on a transparent system that welcomes new business
enterprises. At business USA help international companies looking to invest and expand in this
stable and highly dynamic economy and USA companies to use USA as a formidable platform to
grow their business internationally. So as USA it’s a very friendly country.so we can easily increase
our business growth. When we will be launching a new product from a brand which is already well
received in many countries, we can get positive views and support from Sweden with strategic
advice, practical support, market insights and an extensive business network.

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USA imports huge amount of cloth products:

The United States is Bangladesh's one of the most important trading partner, with about 17-18 per
cent of its exports are being destined for the United States. Bilateral trade between the United
States and Bangladesh was over US$ 8.2 billion in 2018. However, from the United States
perspective, Bangladesh can be considered as a small trading partner, since Bangladesh was the
51st largest trading partner of the United States in 2018. Despite high import tariffs in USA, the
apparel based products from Bangladesh have made successful inroad in the recent years. About
90 percent of the total exports from Bangladesh to the United States are ready made garments.
Bangladesh’s total apparel export in USA was worth $4.29 billion in 2010 and it reached to $5.40
billion during 2018. US based brands and importers can avail the opportunity of low-cost but
apparels of good quality from Bangladesh.

Bangladesh exports to the United States over the recent years are furnished below:

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And garments sector shares their market in USA:

Stable innovative economic:

The USA ranks in first place for both patent activity, and high-tech density—with the highest share
of domestic high-tech public companies in the world. With the “Big Five” tech giants all
headquartered here, it’s easy to see their impact on a global scale. Now USA is the 9th innovative
economic country. There score is 83.17 they measure by seven things:

1) R&D Intensity
2) Patent Activity
3) Tertiary Efficiency
4) Manufacturing Value-added
5) Productivity
6) High-tech Density
7) Researcher Concentration

Basically The U.S. is a mixed economy, exhibiting characteristics of both capitalism and socialism.
Such a mixed economy embraces economic freedom when it comes to capital use, but it also allows
for government intervention for the public good. The government supports innovation and growth
through various agencies and investments in infrastructure. Over three percent of the country’s
gross garments product is spent on research and development, and USA is known for facilitating
collaboration across borders.

Analyzing Doing Business Report

The Doing Business project provides objective measures of business regulations and their
enforcement across 190 economies and selected cities at the subnational and regional level. By
gathering and analyzing comprehensive quantitative data to compare business regulation
environments across economies and over time, Doing Business encourages economies to compete
towards more efficient regulation; offers measurable benchmarks for reform; and serves as a
resource for academics, journalists, private sector researchers and others interested in the business
climate of each economy.

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The United States is ranked 6 among 190 economies in the ease of doing business, according to the
latest World Bank annual ratings. The rank of the United States improved to 6 in 2019 from 8 in
2018.
Before doing business in United States have to look on these issues,
 Summaries of key tax law changes enacted on March 27, 2020, as part of the CARES
Act, as well as state-level legislative and regulatory trends.
 An expanded section on US customs duties and import tariffs to reflect the higher profile
of trade issues facing businesses in the past year, and major developments such as the
USMCA trade agreement, the US-China ‘Phase One’ agreement, and US responses to
various global ‘digital tax’ legislation in different countries.
 Key US tax policy issues for global companies to stay informed of in 2020.

Risk and Limitations:

The US ranks as 49th in the world for ease of starting a business, according to the World Bank and
International Finance Corporation (IFC). The process of starting a business can vary depending on
what state, or even city, you would like to incorporate your company in plus how and where you
intend to operate. With 50 states that all have their own rules and regulations, it can be a challenge
to ensure that your operations remain compliant.

Manufacturing Payroll: Manufacturing Payrolls in the United States increased by 27 thousand

in November of 2020.
Access to capital: US venture capital still remains a critical source of funding for enterprises of all
sizes and stages. While American VCs are prepared to invest all over the world, many find it easier
and less risky to invest in a US entity. Given the other risks posed by high growth companies, a
US presence offers to de-risk at least one aspect of the investment decision. So, it might a slight
issue for getting capital or moving capital.

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Growing Capital Controls
Online banking in other countries is quite impressive if someone only used to deal with own banks.
In one click, anyone can transfer money between twelve different currencies, send wire transfers
around the world at lightning speed, pay bills, and more. That kind of versatility isn’t common in
the United States, where banks typically only offer US dollar accounts and most banks severely
limit transfers to other countries. Even Canada.

The Hidden Costs of Offshoring

One of the primary reasons that location choices may turn out to be less effective than expected is
because USA’s expertise or managers sometimes overlook the current and future hidden costs
associated with operating inside the expensive cities of the United States. So, looking for renowned
places and investing for one area would be a risky moment for any company.

Tax incentives are exclusions, exemption or deduction from tax owed to government.

 Lower Tax Rate: Corporate tax level is lower in USA (21%). Since January 1, 2018,
the nominal federal corporate tax rate in the United States of America is a flat 21% due
to the passage of the Tax Cuts and Jobs Act of 2017. There are seven tax brackets for most
ordinary income: 10 percent, 12 percent, 22 percent, 24 percent, 32 percent, 35 percent and 37
percent. The U.S. has a progressive tax system, which means that as you move up the pay scale,
you also move up the tax scale. But there is two ways by which we can lower the tax. Tax
credits are a dollar-for-dollar reduction in your income tax bill.

 Tax Exemption: The United States Constitution provides strong protection for all
investors, both foreign and domestic. The "takings clause" of the Fifth Amendment
protects investors against expropriation and provides for compensation in case that
property is taken for public purposes. The United States has long advocated similar protection
at an international level. It participates in bilateral and multilateral treaty systems that ensure
the rights of foreign investors. So it can be a great advantage for our project.

 Energy Tax Incentives: Energy related tax incentives make business more affordable.
There are energy efficient appliances and for making energy saving improvements. So
we can have this advantage in our business also.

Easy Incorporation Process

We just have to 7 things in this process. They are
1) Choose Which Type of Business Entity to Form: Corporation or LLC
2) Choose Which State to Form Your Corporation or LLC
3) Requirements to Form a Corporation or LLC in the USA
4) After Forming a US Corporation or US LLC
5) Maintaining Your US Corporation or US LLC
6) Order Online Now!
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 7) Consider Becoming a Reseller or Affiliate
So, the process is pretty easy

Purchasing Real Estate: Anyone may buy and own property in the United States, regardless of
citizenship. There are no laws or restrictions that prevent any individual of any foreign citizenship
from purchasing or owning property in the U.S. This is also an advantage for our business. We can
easily buy property for our business and expand it without any difficulties.
Related Agencies
The International Trade Administration (ITA) is helping to create economic opportunity for
workers and businesses.
To increase trade and investment, ITA helps U.S. companies navigate foreign markets. They helps
educate companies about how to tailor their activities to the specific market with respect to their
product slate, financing, marketing, assembly and logistics. ITA helps equip those businesses with
the knowledge and tools that they need to meet that exporting challenge, and by extension,
promote the trade and investment that helps us all.
Bureau of Industry and Security (BIS) staff can perform outreach and educational activities and
liaise with foreign governments on export control issues. BIS has also compiled a list of resources
to assist exporters complying with foreign export control practices, confirm the business
registration status of companies, and understand the local business environment.

Financial Assistance

Since we are going to start a business in the United States, we may need financial support. On
favorable terms loans are available from the United States Agency for Economic and Regional
Growth and from regional development funds. A foreign-owned firm may raise foreign currency
loans both from its parent corporation and credit institutions abroad. There are many different
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types of U.S. government programs to help in financing foreign business.

Business Development Financing: Government programs help finance your export activities, such
as participation in trade shows and translation of product literature. These programs also enable
U.S. businesses to acquire, construct, renovate, modernize, improve or expand facilities and
equipment to be used in the United States to produce goods or services involved in international
trade.

Capital Financing: Production for an unusually large order or for a surge of orders may present
unexpected and severe strains on working capital. Even during normal periods, inadequate
working capital may curb an exporter’s growth.

Project Financing: Enables U.S. businesses to acquire financing for large-scale projects that
require large amounts of capital, such as infrastructure, telecommunications, power, water,
housing, airports, hotels, high-tech, financial services, and natural resource extraction industries.

World Foreign Financial Assistance (in millions of U.S. dollars)

Trade Barriers in USA

Sweden believes in free trade economy. Therefore it imposes less barriers for foreign direct
investments and at the same time provides incentives to attract foreign investors. Ultimately,

here the trade barriers are limited than that of other countries. If we want to introduce our selected
brand Dairy in Sweden, we may get the following trade barriers which are common in that
country:

Administrative Barriers
Formalities: As we are Bangladeshi local brand, it may be found difficult to translate the
formalities into USA.

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1. Personal tax: The personal tax of USA is pretty much higher than that of other countries. So,
this may create impact on the consumption of goods and services. As a result, for this policy
our company may get some barriers in terms of market demand

2. Work permit: If any foreign personnel want to do job in USA she or he has to get permission
legally. This require a lengthy procedure. So, it can be a barrier for our company to assign any
personnel from home country.
3. Labor cost: In USA, the government established a fair rules and regulation in terms of labor
rights. The labor cost of USA is comparatively higher than that of our country. So, this may
lead to a huge cost for our projected company.

Each year, the U.S. federal government subsidizes a wide range of economic activities
that it wants to promote .

Subsidy
Each year, the U.S. federal government subsidizes a wide range of economic activities that it
wants
to promote, it provides some subsidiaries in terms of tax exemptions, financial aid or other tax
incentives to the local industries to motivate themselves and retain them in the industry. We may
get this.

Joint Venture
The US is largely a freedom of contract jurisdiction, enabling domestic and foreign parties to
collaborate freely with one another in a variety of business contexts. Foreign and domestic parties
are free to make agreements about an almost unlimited number of subjects without forming an
entity together. They are also free to form entities to conduct jointly agreed activities in a limited
liability format. There are certain federal and state laws that regulate matters which often arise for
a joint venture, including these important subjects:

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 1
1

 Competition law. Federal and state anti-trust and competition laws restrict parties from
agreeing to form relationships that violate US fair competition rules. This can:
 impose pre-merger notification and waiting periods for sizeable transactions pursuant to
the Hart-Scott-Rodino Anti-trust Improvements Act of 1976;
 Preclude price fixing and territorial carve-up arrangements when participants in a joint
venture have dominant market power.
 Intellectual property. Patent, trade mark, copyright and other intellectual property (IP)
matters are regulated country by country, with careful attention needed for any joint
venture
that will hold IP rights contributed by the participants.
 Securities laws. US securities rules apply to securities issuance and transfer, and require
consideration when a joint venture is formed or a participant wishes to transfer shares or
units to a third party.
 National security concerns. For businesses that raise national security concerns, there can
be filings required under the Foreign Investment and National Security Act of 2007
and its
underlying statute, the Exon-Florio Amendment to the Defense Procurement Act of 1950.

Increasing Corporate Tax:

The United States of America imposed a separate level of tax in every section. There also mention
about foreign merchandise. They ensure that the same Customs treatment it would if it were
outside the commerce of the United States its main purpose is to be part of the global economy.
Although, the united states end up imposing an extremely small tax on foreign income. However,
it is being planned to be increased in near future. For so many years the balance of trade in the
USA was positive. Recently the government is planning to increase the corporate tax for foreign
companies. If it happened then we might face difficulties for our joint venture project.
High Standard of Living:

What do we understand by the standard of living? Basically, it’s about the services available in
that county, GDP, GNP, wealth material things that countries people have, Economy condition,
and few other things as well. In that case, the United States is considered one of the world’s most
happening places with pretty much the highest standard of living, and people from around the
globe want to be here. It has a prosperous economy. Likewise, even with a GDP higher than any
other country in the world, the US has not been able to ensure equality of economy among all its
citizens. The housing rent, daily expenses are high there. On the other hand, the personal income
tax is higher than that of other countries for foreign business.

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The Impact of Cultural Differences on The Brand:
The cultural difference between the home country (Bangladesh) and the host country (USA) is
identical. A culture is a system of values and norms that are shared among a group of people and
that when taken together constitute a design for a living. The culture might vary from country to
country. It is not just situated in two or three countries it is all around the world. The population
has different choices, food habits, norms and values, language, religion, lifestyle, systems,policies
and more. Their choices could differ too. USA people like to use comfortable clothes whether they
also like trendy and artistic looks which our product can easily provide.

Adjusting the Product for Local Customer:

For doing business in the USA, it's highly necessary to localize the products to grab the market
share. The United States of America already have many established clothing sectors with lots of
variety. It will not easy going to compete with the market. We cannot beat the competitors and sell
the product with our existing packaging quality. Likewise, we are doing a joint venture with H&M
there must have some difficulties as well as some benefits. H&M is a well-known company in
Europe so it can be a great opportunity for us to adjust to the local market. Moreover, there will
be thousands of uncertain issues.
To solve this problem,
 New design: we have designed high quality with the best materials.
 Different types of product: We will offers different types of new and innovative
products and services make its customer delight if we can created a good variety of
products it will
help to get more local customer.
 Cost-cutting: Through the low costing of our product product then can work in the USA
market.
 Increasing product availability: Our product must have to increase their product
line which will help in the long run.
 Focusing on flexibility: As we all know they are mainly focus on comfortable
clothes it’s highly required to look after.

Promotional Strategies:
Communication Channels: we will communicate through following channels-
1. Television Commercials
2. Social Media Marketing (Facebook, Instagram, twitter)
3. Influencer Marketing
4. On-sales point promotions
5. Search Engine Optimization
We will design our promotional strategy into 3 core messages. We will use them in all of our
communication channel.

OUR
BRAND

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 1. Restyling America: Here we will reposition Clothing as a new styling brand. We will
promote our brand as a new fashion brand where we will offer new styling outfits that
matches American test of lifestyle.
2. Bring Color to life: By thing we will try to promote our brand as a colorful brand. Our
outfits do not look boring. When ever you wear it, you will feel like you have added more
color to your life.
3. Be unique: Wearing Our Brand you can stand out from crowed as our cloths are unique in
terms of color, style, comfort etc.

Target Market Selection

Name Age Insights
The Millennials 14-20 Craves for trying new outfits
Young Adults 21-28 These people are getting more
conscious about styling.
Working Class 29-45 These people are likely to buy
more cloths for themselves.
Besides we will target middle, upper middle and high-class people.

We will enter USA with Joint Venture. It is the best option to enter here to setup textile mill and
do everything inside home country. We will go joint venture with H&M. It is one of the most
popular and renowned brands in USA. People love their outfit collections. So, we will go with
them to capture a wide range of market.
Why joint venture?
 Capturing wide range of market, access to new markets and distribution networks.
 Sharing of risks and costs with a partner.
 Access to greater resources, for example technology and finance.
 Access to new knowledge and expertise, including specialized staff.
 Both the companies share same mottos of dominating the USA clothing market.
 International joint venture eradicates the risk of discrimination.

We will launce 4/5 branches of Our brand in popular cities of America such as New York, Chicago, Los,
Angeles, Washington D.C. We will make our cloths in the H&Ms’ manufacturing textile mill.
Conclusion
In conclusion, we would like to mention that we have selected abc brand Outfits and showed the
feasibility of expending it in America. We have showed why USA is the perfect place to expend
by analyzing different facts and reports and also showed how we can enter their and grab the
market directly as a market challenger by localizing our products and promotional strategy.
Following all these methods will help the brand not only to expand but also to get return on
investment at the very first year of the expansion.

Reference:

www.google.com
www.wikipidea.com
www.youtube.com
https://asia.nikkei.com/Business/Business-trends/Bangladesh-fights-for-future-of-its-garment-
industry
Visual Capitalist (2022), The Most Innovative Economies in the World,
https://www.visualcapitalist.com/world-most-innovative-economies/

MSCI (2021), What might U.S. trade barriers mean for global equities from
https://www.msci.com/www/blog-posts/what-might-u-s-trade-barriers/0528387584
Department of Commerce , Foreign Direct Investment in the United States: An Economic Analysis,
https://www.everycrsreport.com/reports/RS21857.html
International Growth Center, Attracting quality foreign direct investment in developing
countries
https://www.theigc.org/blog/attracting-quality-foreign-direct-investment-developing-countries/
International Trade Association (2018), Promoting Trade and Investment,
https://legacy.trade.gov/promotingtrade/index.asp