Stoned the company has incorporating in Malaysia and

Stoned & Co is a Malaysian independent local unisex fashion and lifestyle brand launched in 2014. For Stoned & Co, under trading name of STONED(M) Sdn Bhd, the company has incorporating in Malaysia and had registration number of 1175880-T (Stonedandco, 2018). It has been founded by three creative graphic designers who wanted to make a brand to send their messages to the fashion lovers and influencers. One of the founder also known as managing director, Andrew Ngo, before doing the brand of Stoned & Co, he started designing his own fashion brand since 2012. After a long time, he decided to start up with the Stoned & Co brand with 2 co-founders (Aini, 2018).
The company’s mission is to create some stuffs for selling with the minimal design and the brand name in a unique words font. With the dream for them to have the space to communicate and translate their feeling and thoughts to the world. The brand reflect a lot of different art, culture, and multilingual aspects of Malaysia. For the vision of the brand is to take Malaysia’s streetwear clothing to an international level. The reason of taking to an international level is what the brand did locally already best in quality.

They are making the design through the inspirations of different art, culture, and habits of the people living in Malaysia. They got their way to design the wording of the brand name. Now, the brand is providing a wide range of hip, dope and comfortable streetwear apparels for their customers to choose as their day-to-day fashion. The products include the tops, bottoms, outwear, caps and some accessories with the brand printed on it.

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The market segmentation used by Stoned & Co is psychographic segmentation. This segmentation less concern on geographic and demographic base. They will divide the market based on lifestyles. To properly segment the market based on the lifestyles, marketers of Stoned & Co must spend more time to know their current customers and what the customers want. The company focus on the design to target on the customers based on their interest, styles and what the customers love every day. So the company came with the collection for the customers to choose.
Nowadays, to make a profitable, competitive and successful company, every single company should focus on the macro-environments which may affected by different factors. And these factors can be the government control, rules and regulations, the legislation, the social culture value, the new technologies and the environment that the products sell. For these factors may have a greater impact on all the company decision make.
A political factors are the regulations made by the government that influence some business operation and industry in those countries. The factors included the current legislation, political stability and changes, the laws that related to the business.
For the viewpoint of Malaysia political, it is unstable and causes the investors from foreign countries invest in other countries and negatively affect Malaysian businesses. There are a lot of political issues happen in the country. As we know that bribery is illegal act but the last prime minister of Malaysia, Najib Razak, he is not able to use the money to make improvement on the country. These may reduce the business operations in Malaysia.

The next factor that affect the business is the increase or decrease in tax and economic policies. Now, the goods and services tax (GST) has been cancelled due to the political issue in Malaysia. This may increase the buying power of the consumers because the price of everything that had the GST reduce. But in 2018, the government reintroduce a new tax system: sales and services tax (SST) in September. According to the Star online news by Daljit Dhesi, for the new tax system, it will be charged on the products sell up to 10%. For consumer items like food and beverage, the prices is going down around 3% and for the property, the prices will be cheaper as the manufacturer reduce the cost from the input. The tax system may affect the economy in Malaysia seriously.

Political factors may bring impact on the business and economy. In 2018, the government continues to plan to create new opportunities for the next generation by the preparation of the digital economy. Malaysia tried to increase the cash support for the low-income families, increase the opportunities for the young entrepreneur to start their business and extra funds for the building’s project. But there are some challenges that the country faced, including Malaysia’s currency is dropping and the price of oil is dropping.
In Malaysia, the never end political issues and the weakening ringgit may affect the consumer purchasing power and also the local retail stores. The cost of goods is affected by the dropping ringgit due to the high import costs. All the price of the retail stores like grocery store, electronic stores and restaurants may increase because of the import cost increase.
The political factor that may affect the business operation in Hong Kong is human rights. In Hong Kong, human rights are the rights and freedom of someone living in the country to do something. As the government of Hong Kong has created law included regulations that protects the rights of workers. So the workers got their rights to stand up for their problems and say it. Besides, government provides freedom for the people and workers to do the business activities which is legal. And there are no restrictions on access to the internet.
In Hong Kong, there is no tolerance for bribery. The government has prevented and avoid the bribery and corruption happen in public and private sectors. Besides that, the country is a stable political country and it is a stable society that protect by a bundle of laws. So there are a lot of companies go overseas to Hong Kong to start their international businesses because it is safe as the laws are protecting the companies. For example, intellectual property rights allow those companies to register and run their business under a protection from the government. If the local business wants to go trading or overseas, they need to register Intellectual Property in the international markets.
As the comparison between Hong Kong and Malaysia, both countries need the companies to register their Intellectual Property when they are starting their business. Intellectual Property is very important to a business. And Hong Kong has been ranked 9th place in world for the Intellectual Property according to the report of World economic Forum’s Global Competitiveness 2017. Hong Kong has stable politics as compared to Malaysia while in Malaysia, it is complicated with the political issues. In Hong Kong, the government agency will make investigation and make prosecution of corruption in the public and private sectors. According to the surveys taken by Patricia Moreira from Transparency International, Hong Kong was ranked 13th of 180 countries in the corruption perceptions index (CPI). Besides, Hong Kong is a place where a lot of investors get into the market because Hong Kong is quite stable society under the law and regulations. The country is the low threat of terrorism. The risk of getting attack by the terrorists is low. And the level of crime cases is low too as the police in Hong Kong did their jobs well. Lastly, Hong Kong is a suitable place for international business to get into the market.
The political revolution in Malaysia with new government boosted the economy of Malaysia due to the suspension of Good and Service tax (GST) to 0% which was implemented on 1 June 2018 whereby it was replaced with Sales and Service Tax (SST) to boost private consumption for short term basis claims FocusEconomics (2018). IMF (2018) argues that with the implementation of 11th Malaysia Plan, Malaysia could reach a high-income earning country as there is increase in productivity as well as innovation which also includes the significant increase in female labour force participation in the economy contribution. Besides that, Benjamin (2018) also states that the gross domestic product growth of Malaysia has had an increase of 5.4% this year whereby there is a significant benefit in short term robust trade growth. Chin (2018) beliefs that the labour market condition in Malaysia will remain favourable and supportive towards the growth of the economy with employment rate being expansionary as well as it is able to absorb new entrance into the labour force with unemployment rate being close to no change at 3.2-3.5 percentage in the fiscal year 2018 as to compared with 3.4% unemployment rate in the fiscal year 2017. Hossain (2018) argues that the inflation rate of Malaysia has been stagnant at 2% which is rather low as too compared to other countries. Besides that, Malaysia’s gross domestic product per capita (GDP) is rated at 11,521.45 USD as per 2017 states TradingEconomics (2018)
Coface (2018) argues that the GDP growth of Hong Kong is 43,561 USD as per 2017 with the inflation rate of 2.4 percent. Besides that, with the fiscal policy that is loosened, Hong Kong economic growth is to increase 3.6 percent more that of fiscal year 2017 in year 2018 states TheEconomist (2018). The employment rate in Hong Kong could be separated into seasonal and unseasonal, the seasonal unemployment rate is Hong Kong remains unchanged since 1998 with 2.8 percent however the unseasonal rate of unemployment is at 8.5% in its highest claims TradingEconomics (2018).

Based on the study conducted on the economy of both countries it is evident that Hong Kong earns higher GDP than off Malaysia with significant difference. However due to the large population that Hong Kong has, the GDP earned only an increase of 4.7%, Malaysia has 91% of the world average GDP whereby the increase of Malaysia GDP is at 5.5% states TradingEconomics (2018). On similar standing, IMF states that Malaysia’s income is subjected to increase as a whole due the 11th Malaysia plan which is leading to the year 2020.
On the similar note, with the tax rates Hong Kong is known as the tax haven, this means that Hong Kong has no tax rates, but they only implement income tax. Malaysia on the other hand, has nullified GST and is currently using SST as a tax for goods and service. On this note, this shows that Hong Kong as a whole is better in tax as they are exempted in any extra charges for their goods and services claims Internation (2018).

The unemployment rate of Malaysia is at 3.2-3.4 % which shows that these rates remains the same regardless of seasonal factors that occurs in the nation. However, Hong Kong has two different rates with season at 2.8% which is lower than of Malaysia. Unfortunately the unemployment rate of unseasonal is higher than Malaysia which is at 8.5% which states that there is a high rate of population without job.
Malaysia is a multi-racial country whereby it has 3 main races (Malay, Chinese, and Indian) along with indigenous group in peninsular and north Borneo claims Williamson (2018). The ethnic Malay are given more priority and consideration than any other races when it comes to education, business dealings because they have the privilege and superiority by the government states UKEssay (2013). Based on the housing census done, the population that represented by Malays accounts to 50.4 % followed by 26.0% Chinese, 11.8% Indigenous, Indians with 7.7% and the remaining 1.2% is other racial groups argues UKEssay (2013). Besides that, Malaysia’s population is said as active working-age population with expectancy of growth of 1.6% in the coming decade, whereby the literacy rate is at 95% with English as widely spoken language, this also shows that there is a rise in the number of higher education graduates among Malaysian states ASEAN (2017).

As a fast growing country, Hong Kong population practices Hybrid culture of both east and west, however the majority of the population of Hong Kong is of Chinese ethnic group argues Staff (2018). In similar manner, the population is claimed to have adopted the western way of living, however there is still a strong influence of Cantonese culture could be seen among the population states China (2018). The languages that are spoken among the population of Hong Kong includes English and Chinese whereby there is a high variation of dialects in Chinese such as Cantonese, Mandarin, and many more believes China (2018). The population in Hong Kong has a very strong belief system towards Buddhist temples and the use of Feng Shui whereby they highly believe that the number 4 is associated with the symbol of death states Staff (2018). The population of Hong Kong accounts to 7,428,887 million people with 93% of its population accounts to Chinese nationals states Worldometers (2018). Ngo (2015) argues that the population of Hong Kong is struggling with rapidly aging population with an increase of 31% of elderly by the year 2032.

Based on the research conducted on the aspect of social cultural norm of Malaysia and expansion country Hong Kong, is it evident that the cultural background of both countries varies significantly. Malaysia cultural background consist of 3 main races and 1 indigenous race, where else Hong Kong population has a saturation of 93% of mainly Chinese population. Thus this shows that in the terms of cultural background Malaysia is widely unique as too compared with Hong Kong.
The population of parent country Malaysia has a growing rate of working age population, where else the population of Hong Kong is deemed to have a higher rate of aging population with a significant increase of 31% by the fiscal year 2032. Hence, as a whole, Malaysia has a higher rate of young adults as to compare to the expansion country Hong Kong.
The literacy rate of Malaysia as to compared to Hong Kong shows that, Malaysia has a higher graduate percentage with English as their main command as to compared with Hong Kong. However, the lifestyle of Hong Kong is much more modernized than of Malaysia as they adapted the western culture into their cuisine and lifestyle much more than Malaysia.
As a conclusion, it is evident that the social cultural factor of Hong Kong could still accommodate new brands into their clothing and apparel industry as Hong Kong has a high rate of westernized culture and belief mixed in their traditional ways. Besides, due to the rapid current working condition shows that there is a high degree of working adults currently as to the projected aging population, thus this shows that new clothing line could survive in the current market of Hong Kong clothing industry.
Malaysia has been expanding its technology advancement since its move towards globalization. Eusoff (2017) argues that Malaysia’s investment in technology is to increase 5.7% to RM 65.2 Billion in the year 2018 as to compare to 2017 with only RM 61.1 Billion. Besides that, Worldometer (2018) states that the population of Malaysia has 32,055,373 individuals whereby 24.5 million of the population uses internet frequently. This shows that 76.9% of the population of Malaysia is using internet and technology claims Faizal (2018). The rise of technology in Malaysia also facilitates online and web-based shopping, this is evident when the percentage of online shoppers has had an increase of 35.3 percent in the year 2016 and mobile internet is known as the main medium among the population in Malaysia claims MCMC (2017) which is supported by Appendix 1. According to Alias (2018), the penetration rate of internet and technology has had a significant increase of 85.7 percent since 2015 with only 70 percent.
Based on the researcher Russell (2018) Hong Kong technological advancement is stagnant at 86% since the year 2016 as the country technological advancement is put aside to venture into IPO’s. Lee (2018) also states that the internet usage rate by the population of Hong Kong is at 0.2 percent of the population of Hong Kong which is 7,346,248 individuals. Lee also states that the penetration usage rate of internet in the country is at 74.1 percent which is slightly above the average in the year 2016. Appendix 2 by Statista (2018) argues that the amount of people using mobile internet is at 5.08 million of the population in the year 2017.
Based on the study conducted, it revealed that Malaysia and Hong Kong is equally advanced in the area of technology advancement. However, Malaysia technology advancement in terms of investment in technology is more than Hong Kong as Malaysia has an increase of 5.7% in the year 2018, in the contrary, Hong Kong investment in technology advancement is only stagnant at 86% of it GDP.
Miranda (2018) argues that technology is known to have dramatically improve in effectiveness in business and communication which then facilitates easier and faster use. On that note, Malaysia has a population of 76.8 percent who uses internet facilities which indicates that a high majority of individuals in Malaysia is common subscriber of internet and technology advancement. However in Hong Kong the usage of internet and technology is at 0.2 percent of the population which is significantly low amount of individuals who are subscribed to internet and technology as to compare to Malaysia with 76.8 percent. Thus this shows that it is easier to penetrate the market of Hong Kong through internet basis for Malaysian companies.
Besides that, through the study conducted it is evident that the penetration of mobile internet and internet usage as general in Malaysia is at 85.7 percent in the year 2015. This indicates that there is a high amount of population in Malaysia that uses internet and mobile internet to do online shopping as claimed by Alias (2018). As for Hong Kong, the mobile penetration which includes internet usage is at 74.1 percent in the year 2016, thus this indicate that there is a high amount of mobile penetration when it comes to Hong Kong. However, this rate is not to par with Malaysia as it has 85.7 percent in the year 2015 with a head start.
As a conclusion, although both countries is almost similar when it comes to technological advancement especially in mobile internet, one country is superior than the other when it comes to the penetration rate and the rate of internet use in the country. Thus, this shows that, Malaysia is a country that is slightly technologically advanced than off Hong Kong when it comes to mobile internet and technology investment in general. Hence, through the leverage of being advanced slightly in the area of technology, Malaysia could come up with various techniques and method to influence the market of Hong Kong in the industry of clothing and apparel.
Legal factors is one of the external factors that may also affect how the company run its business activities and the way the consumers need to behave. In Malaysia, the production of a company, the profits earned, and the registration of the business may be affected by the legal factors. Malaysia had a lot of laws to protect the company rights to run their business and to protect the consumer on usage of the products. For example, the consumer law also known as consumer protection which is created to protect the consumers from the companies that have illegal practices and fraud to them in the market. If the companies promise to deliver what they need to deliver to the consumers but they didn’t do that, the consumers may sue them. Besides, there is an employment law that protect the companies’ employees. Employees should legally get paid for their job as the minimum wages would increase the standard of living of the employees.
Other than that, companies need to operate the businesses by following the national regulation in Malaysia. Since the companies are producing the products or providing the services, they need patent, trademark, design, copyright and business setup procedures for their business. Before they get started, they need to register local license and permission from the government. National regulations are allowed the companies to use their own patent, trademarks and copyright to run their business. So that new entrants and other competitors could not copy their products or the way the companies build their products.
In Hong Kong, it had separated its legal system from the mainland of Hong Kong, which is China. It has its own legal system that governed by the government. For the legal environment of Hong Kong, it provides a free and competitive market for the industry to expand the business. So there is less business setup procedures to register a company in Hong Kong.

Under the business laws and regulations of Hong Kong, a company should follow the “Hong Kong Companies Ordinance” by the government. A company need registration of company names, registration of license, the products sell are legal, and documents of approval for business operate to run the business. Other than that, there is also e-legislation which allow the companies to operate the business through online. Companies which operate the business online will be protected by the e-legislation and have their rights to run the business.
For another legal factor that affect the business in Hong Kong is the country would have a system of taxation with low rates that allow many companies to conduct their business. There is no tax on dividends, estate duty and payroll system. But the only taxes that would be charged are the profits tax and property tax. Besides, Hong Kong has the trade regulations which consists the policy on trade and duty free on exporting and importing of goods. But there will be a license to export or import. For the investment part, the industries are open for all the investor. All the domestic and foreign investors have their freedom to invest.
For the last legal factor that affect business in Hong Kong is the Consumer Protection Law. Consumer Protection Law is the law that governed by the country which protect the consumer from the company fraud or cheat. One of the factor of Consumer Protection Law is “Sale of Goods Ordinance”. It refer to the condition of the products or services that provide by the companies. Consumers should get the products or services exactly the same as the companies promise. Otherwise, the contract between the consumers and companies should be breached.
As the comparison of legal factors between Hong Kong and Malaysia, both of the countries have their own legislation to take control of the business activities. In Hong Kong, the local or foreign companies may have higher benefits to operate the business in Hong Kong because the legislation in Hong Kong is determining the success of the businesses. According to the results of the “Environmental Democracy Index”, the scores the companies access to the information is higher than Malaysia as high is a good scores. Hong Kong also has a higher scores of access to justice than Malaysia. The country is a good option for the business to go overseas and get into the market as the customs tariffs are low and low taxation regime compared to Malaysia. For investors, they may choose Hong Kong to invest and engage in import and export sector as well because they can get the more tax advantages. For foreign companies, they can just invest the capital, start-ups to start their business in Hong Kong because the location is a well-known funding centre. Malaysia is also a good location to start a business as the start-ups needed is not high but the government has to improve the economic policies and legislation for a better foreign investments. For both countries, they provide some legal options for those companies to open their branches or private limited liability company in the countries. Businesses could choose Hong Kong as their main option as the country is having good political stability and economic.

In Malaysia, the ecological issue has reached a dangerous level because of the rapid industrial development. First, the problem is that the landfill has occupied the space rapidly due to the 30,000 tons of waste which is generated daily by the Malaysian municipal claims Fauziah et al (2012). There was 70% of household waste and 30% of commercial waste produced by roughly around 30 million Malaysians, thus it caused the Malaysia Government to plan and regulate law to govern the disposal of waste in landfills to reduce the significant amount of waste which amounts to 16.7 million tons argues Recycle (2018). Next, millions of Malaysian are still suffering healthy problem such as heart diseases and asthma which is caused by the air pollution (Malaysia Clean 2017). According to the data available from Numbeo (2018), the air pollution is 55.49% which is significantly moderate in Malaysia. (Numbeo 2018).
Industry always create a lot of waste that will totally affect the quality of the ecological. Thus, it is important for all the businesses to aware of the potential factor that will bring negative impact on the environment. According to our research, there was an average of 15,332 tons of waste every day in 2016 are generated by Hong Kong residents. (Environmental Protection Department 2018). The incorrect way to disposal the waste will cause harm to the environment. Thus, Hong Kong government agency had implemented a green procurement policy to reduce the waste and encourage people participate in recycling. Hong Kong is the highest congestion density in the world, thus it caused the air pollution has reached 69.57% (Numbeo 2018).
Based on the study research, in Hong Kong the amount of waste disposal is 15,332 tons which is significantly low amount of residents as compare to Malaysia which is 30,000 tons. Thus, it is shows that Malaysia significantly has a large amount of the wastes disposal which is means that the country has serious waste disposal management problem.
Through the research conducted it is evident that the percentage of air pollution in Malaysia is at 55.49% so it is indicates that there is a moderate percentage in Malaysia that the quality of air has been polluted. But for Hong Kong, the percentage of air pollution is at 69.57 %, it indicates that there is a high percentage of air pollution when it comes to Hong Kong. Thus, Hong Kong has a higher percentage of air pollution as compared to Malaysia and there is 14.08% difference between Hong Kong and Malaysia. Due to the growth of economic and businesses, Hong Kong has a serious air pollution that may cause many different health problems in the country.
As a conclusion, when company decide to go global, business should considering these ecological factors and thus reduce the damage to the environment when developing a marketing strategy. The company need to more ecological friendly that produce more useful goods and services.
The country we selected is Hong Kong. The first strategy that we used is Hofstede’s six dimensions of culture. We will use Hofstede’s model to explore the culture of Hong Kong, so we can get a good overview of the drivers of the culture related to Malaysia cultures.
Individualism refers to how strength the people connect with others in the community. For both Hong Kong and Malaysia, those countries have a low score of IDV. At the low score of 25, Hong Kong is a collectivist culture where the people act at their interest on themselves only. They do not want to have any relationships with the others in the companies or even in the community. Although the relationships with the colleagues are good when they work as a team, but they feel cold or even hostile to the group of outsider. Other than that, what the people do is to focus on the company’s task and do it for the company. But the people are doing the task for financial rewards or for their own benefits. Even their communications are indirect, they need third party to pass on a message to another colleague. By this part, the people should solve the conflict with the colleague so the people may not have their individualism.
Masculinity versus Femininity (MAS) refers to the dimension is a high score, it is masculine. So the society with masculine is driven by the competition, success and achievement. For the dimension that is a low score, it is feminine. The society with feminine is driven by the caring for others and the quality of life. For example, Hong Kong’s score is 57 while Malaysia’s score is 50, both the countries are getting the high score which make them the masculine society. So most of the people in this society will spend more time for works like hairdressers work from the morning until night time to achieve their success. They want to compete with the society with their performance. They are trying to win among the competition, unlock the new achievement and be successful in their life. Even the kid in school, they also very concerned and fighting for the high exam score and get a better result. Because they know that the scores and rank will get them the success that they want.
Uncertainty Avoidance
Uncertainty avoidance refer to the people tried to avoid the things that did wrong and remain unknown and unpredictable. In Malaysia, the score of uncertainty avoidance index (UAI) is 36 and it is considered low score. In the low UAI society, people are more likely to take risk to make their decisions, they are more entrepreneurial and no depends on the rules.
Long Term Orientation
The long term orientation refer to how the society respond while facing with the current and the future challenges. In Malaysia, there is a low score of 41 for the country. The society is more concerned about the present and the past and they think them are more important than the future. So by this, Malaysians are doing their jobs in traditional way and they are fulfilling their social obligations. But in Hong Kong which has a high score of 61, the people lived in the country are focused on the future. They are willing to delay or stop their current short-term job or social success and try to prepare for the future need.
2462318142875Country Attractiveness
0Country Attractiveness
With Each
With Each

127000698500 PRIMARY MARKETTable 2.0
left3810Source: Harrell G D and Kiefer R O (1993)
0Source: Harrell G D and Kiefer R O (1993)

Based on the research conducted on the business portfolio of Hong Kong and Malaysia, the country attractiveness and compatibility among both companies is at medium. Researchers at Ministry of International Trade and Industry MITI (2018) argues that the compatibility of Malaysian market and Hong Kong is at medium because the imports rates of clothing and apparel is at RM 17.67 billion.
Besides that, country attractiveness of Malaysia and Hong Kong is medium as well because both countries is located at Asia region. Through the statistics obtained, the workforce in Hong Kong is of middle age, by the year 2020 it would be 1000 million Hong Kong population is to be said to have double the amount of aging population states Hong Kong (2013). In the contrary, Malaysia population of working force is to increase, because only 32 percent of the population is not of working age states Bernama (2017). Thus it shows that both countries compliments each other.

As a conclusion, the primary market of clothing and apparel industry in Hong Kong is compatible with the nature of Malaysia market. This could be evident through the justification and diagram above.
Political   ?  
Commercial   ?  
Industrial   ?  
Financial   ?        
Table 1.0
Based on the research conducted on the four risk matrix, the political risk that is involved in the risk matrix is moderate. Table 1.0 of the risk matrix suggest that the risk model is moderate, this is because Hong Kong foreign investment and businesses is rapidly expanding states Tan (2017). Thus this shows that Hong Kong has a strong political background, the risk of entry is moderate for Malaysia.
Table 1.0 of the risk matrix shows that the commercial risk of Hong Kong is some. Chan (2017) argues that the commercial risk of entering into clothing industry in Hong Kong is moderate because Hong Kong could supply clothes in a short period of time. This shows that the commercial industry of clothing of Hong Kong market is easily penetrated by Malaysia.

Besides that, the industrial risk of entering into Hong Kong market is moderate. This evident when the exports and import rates of clothing line for Hong Kong is at 1.7 percent of its total Gross Domestic Product (GDP) claims Chan (2017). Thus this shows that it easy for Malaysia to penetrate into Hong Kong clothing industry with minimal risk.
Next, the financials and banking of Hong Kong is at moderate rate, this shows that is economically and financially safe to venture into Hong Kong clothing industry. Liu (2017) believes that, Hong Kong has the title and ranking as the world’s largest apparel maker by production volume in 2016. This shows that Hong Kong is stable financially in its clothing industry with the GDP of 63. Billion USD states Statista (2018).
As a conclusion, it is lucrative for Malaysia to venture into Hong Kong clothing industry market. Based on table 1.0, it shows that the total risk factor of venturing into the market of Hong Kong is low. This is evident as all the ticks are in the left quadrant of the risk factor matrix.
Based on the research conducted, Stoned & Co is a Malaysian local independent brand that sells clothing and apparels as well as accessories related with the line. The study on both countries concluded that the entry strategy to enter into Hong Kong market would be mixed strategy whereby it includes differentiation, standardisation and adaptation method being used.

The research shed a light on the clothing and apparel industry of both Malaysia and Hong Kong, both country has similar dressing style claims Rabimov (2018), he claims that both country embrace wider range of western infused with traditional fashion in their fashion and style. Hence, to meet the needs of Hong Kong local market, Stoned & Co would standardize and adapt certain values and features of the local market.
The first differentiation strategy that is used to enter into Hong Kong market would be sales promotion method. The adaptation of communication and selling strategy such as using WeChat pay to facilitate the high usage of WeChat online banking could be done by Stoned & Co, in such instance the company can provide discount codes online in WeChat (Li, 2018). Promotional tool such as social media market that Weibo and Facebook is the highly used websites in Hong Kong claims Davis (2018). Thus through this market of Weibo and Facebook, local Hong Kong population could learn more on Stoned & Co products.
As for the next differentiation strategy in entry would be the pricing. Price penetration is also used to enter into Hong Kong market. This is done to ensure that more consumers in international market could use Stoned & Co products. Penetration pricing would be done through setting price to cover production cost of the Stoned & Co merchandise and sold at lower price to match with lower price competitor in Hong Kong market. Upon market penetration, Stoned & Co would set its prices slightly higher to gain more profits in international market.
Besides that, distribution channel is also another form of differentiation that Stoned & Co could practice to enter into the clothing and apparel industry of Hong Kong. The company will first start selling its product and brand in major cities such as Tsuen Wan, Sha Tin and Tin Shui Wai in its initial stage (Hong Kong, 2018). Besides that distribution channel such as local clothing and apparel companies will be aliased to carry Stoned & Co products. Hence, Stoned & Co would include export management companies to expedite the process of exporting the goods to Hong Kong.

On the other hand, standardisation of product is also one of the market entry strategy that Stoned & Co use for venturing into Hong Kong industry. Product pricing, is done through accessing the standard of living in Hong Kong. Thus, the standard of Hong Kong living conditions which shows that they have a higher buying power indicates that they are willing to pay more for clothing as to compare to individuals in Malaysia claims Deepa (2017).

The next strategy that would be used to enter into Hong Kong clothing industry and market would be the joint venture. Joint venture is chosen as one of the method as starting up a physical store by itself is very expensive, thus through the use of joint venture, Stoned & Co could save their cost of renting and operations. Besides that, the risk of failure would be lesser as joint venture lessen the risk of losing profits.
Finally, Stoned & Co could enter into Hong Kong market by franchising. Franchising could help the company gain royalty through the use of name. Besides that, through franchising the risk of operations and setting brand name and image is also lessen as parent company would have established the name and type of product.
As a conclusion, through the strategies suggested, Stoned & Co could venture into Hong Kong market with ease as there is many entry strategy which is low cost and income generating for the company.
Based on the study that is conducted on Hong Kong market, it is evident that the clothing and apparel industry is lucrative since there is abundance of working adults and teenagers in Hong Kong. Based on Hong Kong’s clothing industry, it is very attractive for the local customers and the foreign investors. According to the Market Insights, the sales of the clothing increase year by year. And the industries are very competitive and Hong Kong is an international hub in Asia. And the industries may be affected by the ‘Hong Kong Fashion Week’. Hong Kong Fashion Week will be held twice a year. Besides, through the study, various entry strategy and product adaptation could be done to cater to Hong Kong market and its belief as well as cultural similarities. And the city put efforts to focus on the online clothing websites and increase the consumer’s online purchase intention.

As a conclusion, with all the evidence and justification of new entry to Hong Kong, we wish that the company would consider this business proposal and report so that the brand and image of Stoned & Co could be elevated in international market.


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