MNB3702
Assignment 2 Semester 1 2025
Unique Number:
Due Date: 10 April 2025
5 COMPANIES INCLUDED
TABLE OF CONTENTS
ASTY PLASTICS MACHINERY CC........................................................................... 2
KINGSGATE CLOTHING......................................................................................... 11
MAKHAMISA FOODS (PTY) LTD............................................................................ 18
FOOTWEAR INDUSTRY TRAINING ....................................................................... 25
PAVATI PLASTICS SOUTHERN AFRICA (PTY) LTD............................................. 33
DISCLAIMER & TERMS OF USE
Educational Aid: These study notes are intended to be used as educational resources and should not be seen as a
replacement for individual research, critical analysis, or professional consultation. Students are encouraged to perform
their own research and seek advice from their instructors or academic advisors for specific assignment guidelines.
Personal Responsibility: While every effort has been made to ensure the accuracy and reliability of the information in
these study notes, the seller does not guarantee the completeness or correctness of all content. The buyer is
responsible for verifying the accuracy of the information and exercising their own judgment when applying it to their
assignments.
Academic Integrity: It is essential for students to maintain academic integrity and follow their institution's policies
regarding plagiarism, citation, and referencing. These study notes should be used as learning tools and sources of
inspiration. Any direct reproduction of the content without proper citation and acknowledgment may be considered
academic misconduct.
Limited Liability: The seller shall not be liable for any direct or indirect damages, losses, or consequences arising from
the use of these notes. This includes, but is not limited to, poor academic performance, penalties, or any other negative
consequences resulting from the application or misuse of the information provided.
, For additional support +27 81 278 3372
5 COMPANIES INCLUDED
TABLE OF CONTENTS
ASTY PLASTICS MACHINERY CC ........................................................................... 2
KINGSGATE CLOTHING ......................................................................................... 11
MAKHAMISA FOODS (PTY) LTD ............................................................................ 18
FOOTWEAR INDUSTRY TRAINING ....................................................................... 25
PAVATI PLASTICS SOUTHERN AFRICA (PTY) LTD ............................................. 33
ASTY PLASTICS MACHINERY CC
1. INTRODUCTION: IMPORT OR EXPORT DECISION
Asty Plastics, a South African manufacturer based in Gauteng, specializes in custom
plastic injection moulding and component manufacturing across diverse industries,
including automotive, medical, telecommunications, and electronics. With a
reputation for quality and innovative plastic solutions, Asty Plastics has developed a
strong domestic footprint and now seeks to expand through exporting its high-
performance plastic components to Kenya. This strategic move aligns with the
growing demand for medical and industrial plastic products in East Africa and is
encouraged by the African Continental Free Trade Area (AfCFTA), which reduces
trade barriers between African nations. The company's export initiative targets
Kenya's robust manufacturing and healthcare sectors, taking advantage of
favourable trade conditions and expanding market opportunities. This paper
evaluates the decision to export, assesses institutional challenges and opportunities,
analyses resource creation through the network internalisation model, and proposes
a suitable multinational strategy to ensure a balance between local responsiveness
and global efficiency. The ultimate goal is to demonstrate how Asty Plastics can
navigate the Kenyan business environment while strengthening its competitive
advantage through sustainable export growth.
, For additional support +27 81 278 3372
2. EVALUATION OF IMPORT OR EXPORT DECISION
Asty Plastics’ decision to export to Kenya is both strategically and economically
viable, particularly under the AfCFTA framework, which reduces trade tariffs and
simplifies market entry. According to Peng and Meyer (2019), firms engaging in
international business must consider formal and informal institutions that influence
business success. Kenya, a rapidly industrializing economy, offers a politically stable
environment with improved governance structures and a pro-business regulatory
framework, making it conducive for export ventures. The political stability and
implementation of Vision 2030—Kenya’s long-term development blueprint—further
supports industrialization and increased imports of quality manufacturing inputs and
finished goods.
From an economic perspective, Kenya serves as a regional hub in East Africa, with
access to several landlocked countries. Its growing healthcare and manufacturing
sectors create a demand for high-quality, customized plastic components, aligning
with Asty Plastics' core offerings. The economic climate, characterized by moderate
GDP growth and increasing foreign direct investment (FDI), suggests rising demand
for intermediate goods like those produced by Asty Plastics (World Bank, 2024).
Legal and compliance aspects are central to the export process. Kenyan trade
regulations under the Kenya Bureau of Standards (KEBS) and import quality
requirements can present entry barriers, but Asty Plastics’ ISO 9001 and IATF 16949
certifications provide a competitive edge in meeting such standards. Furthermore,
the company's existing experience in quality assurance and logistics in South Africa
is transferrable and can mitigate risks related to legal compliance and customs
processes (Peng & Meyer, 2023).
Cultural and communication dynamics are equally vital in international business.
Kenya's business culture places emphasis on personal relationships, hierarchical
communication, and patience in negotiations. Understanding these dynamics can
help Asty Plastics build strong partnerships with distributors and institutional buyers.
The firm must invest in cultural intelligence and hire or partner with local agents to
, For additional support +27 81 278 3372
bridge cultural gaps and manage customer expectations effectively (Trompenaars &
Hampden-Turner, 2012).
By using its home-based capabilities and adapting them to a foreign market, Asty
Plastics can avoid costly entry mistakes. Peng and Meyer (2023) stress that firms
with accumulated international experience can leverage their knowledge to optimize
logistics, manage compliance risks, and build market-specific strategies. The
company’s ability to transfer knowledge from its South African operations to the
Kenyan market, while adapting to local conditions, enables it to establish a
competitive export operation.
3. INSTITUTIONAL CHALLENGES AND OPPORTUNITIES
When expanding internationally, firms like Asty Plastics must evaluate both formal
and informal institutions in the host country. According to Peng and Meyer (2019),
institutions shape the rules of the game for business and include regulations, laws,
norms, and cultural values. In the context of exporting to Kenya, several institutional
challenges and opportunities emerge.
One major formal institutional challenge is the complexity of Kenya’s regulatory
framework. While the government actively promotes industrialization, it also imposes
strict import requirements. The Kenya Bureau of Standards (KEBS) oversees
product certification, quality inspection, and compliance with safety standards. For
Asty Plastics, this means adapting to additional testing and certification processes
beyond South African standards. Navigating customs clearance and meeting the
Pre-Export Verification of Conformity (PVoC) system can delay shipments and
increase costs if not properly managed (Peng & Meyer, 2023).
Another formal challenge lies in infrastructure constraints. Although Kenya has made
significant progress in improving its road and port infrastructure, inefficiencies in
logistics—particularly at Mombasa Port and border crossings—can lead to delays
and additional transport costs. Moreover, unpredictable power supply in industrial
Assignment 2 Semester 1 2025
Unique Number:
Due Date: 10 April 2025
5 COMPANIES INCLUDED
TABLE OF CONTENTS
ASTY PLASTICS MACHINERY CC........................................................................... 2
KINGSGATE CLOTHING......................................................................................... 11
MAKHAMISA FOODS (PTY) LTD............................................................................ 18
FOOTWEAR INDUSTRY TRAINING ....................................................................... 25
PAVATI PLASTICS SOUTHERN AFRICA (PTY) LTD............................................. 33
DISCLAIMER & TERMS OF USE
Educational Aid: These study notes are intended to be used as educational resources and should not be seen as a
replacement for individual research, critical analysis, or professional consultation. Students are encouraged to perform
their own research and seek advice from their instructors or academic advisors for specific assignment guidelines.
Personal Responsibility: While every effort has been made to ensure the accuracy and reliability of the information in
these study notes, the seller does not guarantee the completeness or correctness of all content. The buyer is
responsible for verifying the accuracy of the information and exercising their own judgment when applying it to their
assignments.
Academic Integrity: It is essential for students to maintain academic integrity and follow their institution's policies
regarding plagiarism, citation, and referencing. These study notes should be used as learning tools and sources of
inspiration. Any direct reproduction of the content without proper citation and acknowledgment may be considered
academic misconduct.
Limited Liability: The seller shall not be liable for any direct or indirect damages, losses, or consequences arising from
the use of these notes. This includes, but is not limited to, poor academic performance, penalties, or any other negative
consequences resulting from the application or misuse of the information provided.
, For additional support +27 81 278 3372
5 COMPANIES INCLUDED
TABLE OF CONTENTS
ASTY PLASTICS MACHINERY CC ........................................................................... 2
KINGSGATE CLOTHING ......................................................................................... 11
MAKHAMISA FOODS (PTY) LTD ............................................................................ 18
FOOTWEAR INDUSTRY TRAINING ....................................................................... 25
PAVATI PLASTICS SOUTHERN AFRICA (PTY) LTD ............................................. 33
ASTY PLASTICS MACHINERY CC
1. INTRODUCTION: IMPORT OR EXPORT DECISION
Asty Plastics, a South African manufacturer based in Gauteng, specializes in custom
plastic injection moulding and component manufacturing across diverse industries,
including automotive, medical, telecommunications, and electronics. With a
reputation for quality and innovative plastic solutions, Asty Plastics has developed a
strong domestic footprint and now seeks to expand through exporting its high-
performance plastic components to Kenya. This strategic move aligns with the
growing demand for medical and industrial plastic products in East Africa and is
encouraged by the African Continental Free Trade Area (AfCFTA), which reduces
trade barriers between African nations. The company's export initiative targets
Kenya's robust manufacturing and healthcare sectors, taking advantage of
favourable trade conditions and expanding market opportunities. This paper
evaluates the decision to export, assesses institutional challenges and opportunities,
analyses resource creation through the network internalisation model, and proposes
a suitable multinational strategy to ensure a balance between local responsiveness
and global efficiency. The ultimate goal is to demonstrate how Asty Plastics can
navigate the Kenyan business environment while strengthening its competitive
advantage through sustainable export growth.
, For additional support +27 81 278 3372
2. EVALUATION OF IMPORT OR EXPORT DECISION
Asty Plastics’ decision to export to Kenya is both strategically and economically
viable, particularly under the AfCFTA framework, which reduces trade tariffs and
simplifies market entry. According to Peng and Meyer (2019), firms engaging in
international business must consider formal and informal institutions that influence
business success. Kenya, a rapidly industrializing economy, offers a politically stable
environment with improved governance structures and a pro-business regulatory
framework, making it conducive for export ventures. The political stability and
implementation of Vision 2030—Kenya’s long-term development blueprint—further
supports industrialization and increased imports of quality manufacturing inputs and
finished goods.
From an economic perspective, Kenya serves as a regional hub in East Africa, with
access to several landlocked countries. Its growing healthcare and manufacturing
sectors create a demand for high-quality, customized plastic components, aligning
with Asty Plastics' core offerings. The economic climate, characterized by moderate
GDP growth and increasing foreign direct investment (FDI), suggests rising demand
for intermediate goods like those produced by Asty Plastics (World Bank, 2024).
Legal and compliance aspects are central to the export process. Kenyan trade
regulations under the Kenya Bureau of Standards (KEBS) and import quality
requirements can present entry barriers, but Asty Plastics’ ISO 9001 and IATF 16949
certifications provide a competitive edge in meeting such standards. Furthermore,
the company's existing experience in quality assurance and logistics in South Africa
is transferrable and can mitigate risks related to legal compliance and customs
processes (Peng & Meyer, 2023).
Cultural and communication dynamics are equally vital in international business.
Kenya's business culture places emphasis on personal relationships, hierarchical
communication, and patience in negotiations. Understanding these dynamics can
help Asty Plastics build strong partnerships with distributors and institutional buyers.
The firm must invest in cultural intelligence and hire or partner with local agents to
, For additional support +27 81 278 3372
bridge cultural gaps and manage customer expectations effectively (Trompenaars &
Hampden-Turner, 2012).
By using its home-based capabilities and adapting them to a foreign market, Asty
Plastics can avoid costly entry mistakes. Peng and Meyer (2023) stress that firms
with accumulated international experience can leverage their knowledge to optimize
logistics, manage compliance risks, and build market-specific strategies. The
company’s ability to transfer knowledge from its South African operations to the
Kenyan market, while adapting to local conditions, enables it to establish a
competitive export operation.
3. INSTITUTIONAL CHALLENGES AND OPPORTUNITIES
When expanding internationally, firms like Asty Plastics must evaluate both formal
and informal institutions in the host country. According to Peng and Meyer (2019),
institutions shape the rules of the game for business and include regulations, laws,
norms, and cultural values. In the context of exporting to Kenya, several institutional
challenges and opportunities emerge.
One major formal institutional challenge is the complexity of Kenya’s regulatory
framework. While the government actively promotes industrialization, it also imposes
strict import requirements. The Kenya Bureau of Standards (KEBS) oversees
product certification, quality inspection, and compliance with safety standards. For
Asty Plastics, this means adapting to additional testing and certification processes
beyond South African standards. Navigating customs clearance and meeting the
Pre-Export Verification of Conformity (PVoC) system can delay shipments and
increase costs if not properly managed (Peng & Meyer, 2023).
Another formal challenge lies in infrastructure constraints. Although Kenya has made
significant progress in improving its road and port infrastructure, inefficiencies in
logistics—particularly at Mombasa Port and border crossings—can lead to delays
and additional transport costs. Moreover, unpredictable power supply in industrial
