Internationalization process: GuestCentric Systems Embracing People‟s Republic of China

Abstract

The way the independent hotel industry makes business has recently changed. Startup venture capitalist GuestCentric Systemsi henceforth called GC, is a small sized IT company that is tackling an unmet opportunity, they are revolutionizing the online presence of the independent hotel industry by offering a fully integrated e-commerce management solution that allows hotels to create an outstanding online presence, resulting in an increase of their online bookings, through equipping hoteliers with innovative e-commerce optimization features, in a fast and affordable way. Up until now this was only within reach of big hotel chains, thus GC is leveling the playing field, as well as empowering hoteliers to bypass intermediaries, reducing costs while increasing sales growth. Notwithstanding, CG has massive costs that are impacting seriously the company and causing a huge negative EBIT of €1.100.000, meaning that their revenues of €300.000 are not able to cover minimally their costs of €1.400.000 estimated for 2010. Thereby, GC has an innovative business model that is sustainable, if and only if, the company is able to capture a great market share. GC was demanded to internationalize and will have to proceed on doing it to obtain the required customer base and overcome the delicate financial situation. Being a web based company, GC has perceived that it not enough to have a website to attract clients, it is required highly countries‟ adaptations to boost sales. That is the reason why this project has as its cornerstone the internationalization process of GC to China, therefore, the purpose of this work and its major added value is not only to build up and streamlining a step-by-step internationalization business plan with accurate solutions to enter and succeed in this market, but also, recommend GC the right momentum to enter in it, having in mind the tradeoff between the consolidation of their financial position and the vitality of the Chinese market.