The new market that Victoria’s secret will be globally expanding into is the Portuguese market to further the expansion of the business worldwide. The Portuguese market has a large population of 10.5 million with a continuing growth in the population also with high life expectancy on average of 81 years and a low death rate.

 

The Portuguese economy is bouncing back after there recession in 2010-2013 which meant citizens had less money to spend of goods but had too focus of the cost of living. There economy is now continuing to grow and have an increase in there GDP (see graph 2). There is an increase in the disposable income of citizens living in Portugal therefor meaning they have more money to spend freely. 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

The textile and clothing industry is one of Portugal’s most important industries in the Portuguese economy making 20% of the industries employment and manufacturing production. Portugal is in a strategic location being the nearest country in Europe to the US and also a three-hour distance between Brazil and Russia. This is in a great location for importing ad-exporting goods with the opportunity of building good connections (Aicep, 2013).

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Costing of retail space/ industry space is cheaper than other European countries such as France and Spain. Also income derived from real estate is subject to a tax rate of 10 per cent.

 

 

 

 

 

 

 

 

 

 

 

 

The lingerie and clothing market in Portugal is a non-saturated industry currently and with no signs of upcoming change it is evident that there is a gap in the market for Victoria’s secret.

 

The purchasing behaviour of the Portuguese consumer is mainly determined by:

- Advertising (TV and radio)

- The value for money of after-sales service for cars and household appliances

- Price (especially for food and hygiene purchases)

- Social status symbols (clothes, fashion, cars)

- Brand names, associated with this aspect of social status.

(Santander, 2015)

 

Portugal attracts many tourists each year. In 2010, 8 million tourists visited the country. Tourism is playing an increasingly important role in Portugal's economy contributing about 8% of the Gross Domestic Product (GDP). (wttc, 2014)

 

The development of fast transport links, in Portugal means it’s easy to travel across and also enter into. Key transport links are high way roads, national rail services, buses, seaports, Airports and underground transport. (Portugal live,2014).

 

When entering the Portuguese market there will be entry barriers that Victoria’s secrets will need to consider such as there language differences as there native languages are Portuguese and Mirandese.

The currency difference from the US $ into the Euros however the exchange rate is very strong $1 dollar= 0.92 euros. This then means that the pricing would not change drastically. When pricing the products they need to consider the tax rate which is 20% in Portugal to make sure they are covering there costs with the correct pricing.