Michel’s Initial Launch into ChinaWeek 6 MKX5260 Case Analysis Student ID: 26644363 Student Name: Hao XuPlease watch the video case of Michel’s patisserie and answer the following question in written format (also prepare the answers to other questions listed on the tutorial agenda for tutorial discussion):What is your assessment of Michel’s initial launch into China? What would you have done differently?As we know from the video, China has a deep culture environment of tee. It means that Chinese people has their own favourite tastes for centuries. Therefore, the consumption of coffee in China was lower than local beverage, although the consumption of coffee had increased in some special and developed cities in China like Beijing and Shanghai in recent years. Because of low requirement of coffee, the Michel’s company is hard to sale their products. On the other hand, there are many competitors existed in China. One of the most powerful and successful coffee companies is Starbucks that has owned more than 500 stores in China. In fact, Starbucks’s image and experience are more accepted by Chinese people than its products like coffee.
To launch into Chinese market, Michel’s would face several challenges. Firstly, Michel’s has successful franchising system, which is the most important advantage of competition for the part of operation. The franchising system refers that the company prepared all the products in a central bakery, and then delivered to the franchisee’s shop. Thus, the franchisees just need to clear up the goods and start their own business. However, there are some issues existed in operating the franchising system in China. If the company could not set up a central bakery and relevant supply chain, the advantage of the company may be useless. As a result, the company could not obtain enough customer base and market share. So does the profit.
In contrast, in Chinese franchising system, the most important benefit of the brand, is the company does not need to pay dues to the franchisee. Therefore, consumers of a brand have to feel obliged to take care of the responsibility which is due to the franchisee, even if it is not free at a reasonable price from his or her own salary. With this in mind, the operator of the bakery in Chengdu, the franchising company and the brand have also not been able to develop such system.
Thirdly, China is also a market with great variety of brands and the business model developed by a large number of brands is of great interest. This is the reason many consumers were interested to try out new, brands. For example, Jeeves, Zhennan, Szechuan, Zia, DHL, MIX and SRT have many designs and some very good design. Also, some of these also can be found in the market in any country:
China has so many different brands, but they are very similar. There is also their ‘traditional brand’ which is sold only in China and no brand can be made that is also suitable for mass market.
While the brand market is a little different in China nowadays, the same approach works best when it comes to brand products. There are many brands in China and consumers have to choose the brands and designs. So the consumer is also interested and is looking at brand designs for more options to be chosen.
The product quality of new brands varies from brand to brand and some brands work better than others. This can cause great disappointment.
One of the biggest reasons is that it is the business model that is also the most important thing for consumers. To make sure that brand and brand are in the same company when it comes to design, sales have to be in the same place of selling the products, and the products needed for marketing, etc.
In such case, with brand, customer has to feel like an investor and an investor is responsible and willing to take on business for itself. This means that the brand and brand has to be considered as an important part of all a brand and company’s business.
Proud Brands
In Chinese business, a name is defined as one that says something or people: the brands are made of these great things. But why could the name be just two brand names? As we shall see, it could be a good thing for brand quality.
One of the major problems during branding is that it seems to attract only a limited number of people. So that is why it is not acceptable to have an official name and company logo of five or six people. Another reason is that a few people are afraid to take risks and choose brands.
One of the things that consumers did to decide company name and brand name is