Essay About Export Orders And Domestic Market

Use Stp Model – Standardization and Adaptation
USE STP MODEL: – Standardization and adaptationBarrett Farm Foods:-Sells nuts, cereal bars, garlic, ginger, dried fruits, and honey throughout Australia.Australias 6th largest food company. Healthy growth rate over past decades and its sales reached USD $215 million last year. well known in the domestic market (international experience has been limited)Barrett has relied on intermediaries in Australia (for completing export orders)Opportunity:-Australian food export exceeds AU $ 30bn last yearProcessed food stuffs are the coming trends and want to boost exports(Most current export is raw foods)Processed food bring in more money in exports and creates jobs If just 10 percent of processed food value-adding done in Australia, the countrys balance of trade would improve.Meat, cereal, sugar, dairy commodities, and marine products have the most potential for food processing.Do you see any problems with Philip Austins plan for European expansion? Do you support his entrepreneurial approach to exporting? What should be the features of a more systematic approach to exporting?Main issues:-First, Europe, also, has many differences in national tastes and market structures.While Australians love Vegemite-a brown, salty breakfast spread – little popularity outside Australia. Second, BFF had little almost nil experience in export.BFF has to solve problems of export sector as they have very little internal expertise to deal with international shippingBFF managers were not as optimistic as Phillip AustinMoreover, they have to rely on foreign Intermediaries, therefore they have to ensure no dispute arises during compensationsCompete with larger and more experienced competitors in EU with competitive pricing, whose complexity can overwhelm inexperienced managersPhillip Austin’s Approach;Created a three person task force from his senior managers  to implement the Export driveTargeted US$30 million volume for the first yearIdentify its most promising product for exportAppoint agents like Peter Telford to facilitate EU salesPeople met during Cologne fair were potential customers for immediate salesIdentify and appoint distributor(s) with access to supermarkets and large scale buyers or forward some company products to EU importersRevamp website to attract Export businessForeign Market Entry Strategies:-Importing or global sourcing: Exporting: BFFCountertrade:Foreign direct investment (FDI): BFF Collaborative ventures: BFFlicensingFranchising COmpany Readiness to Exporting (CORE)Importing or global sourcing: Procurement of products and services from foreign sources  Exporting: Producing products or services in one country (often the producer’s home country), and selling and distributing them to customers in other countries Countertrade: International transaction in which all or partial payments are made in kind rather than cashIn contrast to home-based international operations (e.g., exporting), foreign direct investment (FDI) involves establishing a presence in the foreign market by investing capital and securing ownership of a factory, subsidiary, or other facility there.  Collaborative ventures include joint ventures in which the firm makes similar equity investments abroad, but in partnership with another company. With licensing, the firm allows a foreign partner to use its intellectual property in return for royalties or other compensation.Franchising is common in retailing. McDonalds, Dunkin’ Donuts, Century 21 Real Estate, and many other firms have used franchising to internationalize worldwide. Factors to Consider When Choosing a Foreign Market Entry Strategy:-Goals and objectives of the firm Degree of control desired The firm’s resources and capabilities The types of risk inherent in each proposed foreign ventureConditions in the target country Nature and extent of competition Availability and capabilities of partners in the marketThe value-adding activities the firm is willing to perform in the market and the activities it will delegate to local partnersLong-term strategic importance of the marketCharacteristics of the product or serviceExporting Overview:-Usually the firm’s first foreign entry strategy,Low risk, low cost, and flexible. Popular among SMEs.Most exports involve merchandise.Export channels:Independent distributor or agentFirm’s own marketing subsidiary abroad Internal and External analysis:-External PESTEL Porters Five forces OT from SWOTCompetitors Analysis :- WAITROSE, Sainsbury’sInternalStrength & Weaknesses BenchmarkingVRIN Analysis Systematic Approach:-[pic 1]Step one:-Assess global market opportunityBFF must screen most attractive marketsIdentify the qualified distributersestimate industry market potential and company sales potential Step Two:-        Organise for ExportingAssess firm’s resource needs;  establish timetable for achieving export goals; decide on distribution strategyStep Three:-        Acquire needed skills and Competencies