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German Market Expansion Evaluation of Dairy Farm

Info: 8610 words (34 pages) Dissertation
Published: 10th Dec 2019

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Tagged: International BusinessBusiness Analysis

GLENILEN FARM 1 Introduction------------------------------------------------------------------------------------      7     Table of content
  1. Perspective---------------------------------------------------------------------------------     7
  2. Ambition------------------------------------------------------------------------------------     8
  3. Justification--------------------------------------------------------------------------------     8
  1. Positioning-------------------------------------------------------------------------------------     9
  2. Porter’s Five Forces-------------------------------------------------------------------------   10
  3. Cage Framework----------------------------------------------------------------------------    11
  4. Organizational Value chain---------------------------------------------------------------    13
  5. HRM plan------------------------------------------------------------------------------------     15
  6. Conclusion------------------------------------------------------------------------------------    17
  7. Bibliography----------------------------------------------------------------------------------   18
  Appendices 1 PESTLE Analysis-------------------------------------------------------------------------------- 21 2 Scenario Planning--------------------------------------------------------------------------------23     2.1 Positive scenario-----------------------------------------------------------------------------23     2.2 Negative Scenario---------------------------------------------------------------------------23 3 Cage Analysis--------------------------------------------------------------------------------------24 4 Organizational Value chain---------------------------------------------------------------------26 5 Cultural web---------------------------------------------------------------------------------------27 6 SWOT Analysis-----------------------------------------------------------------------------------29   Introduction Glenilen is a diary based Farm in Drimoleague West cork. The company was started by Valerie and Alan Kingston in the year 1997 in their own farm. Their initial products were yogurt and soft cheese sold at farmers markets. They sold cheesecake at local farmers market and rapidly proving their popularity, this led to gain development and popularity to Glenilen in local market. At present Glenilen’s products are now available throughout Ireland in over 200 independent supermarkets and specialist food shops. In addition the company employees a staff of 35 people. The main success for the Glenilen products in Irish market is the quality of record they maintain in the past years, which also created a great reputation to expand their products in global market. Glenilen farm started its export challenge to UK market in 2009. Their products have a very short shelf life so minimal distribution time is essential. Their dairy products gains one of the biggest reputation in the market because of one the key factor which helps people to be free from adulterant as the dairy products which is being made is purely natural.  So initially they targeted the high end retailers such as Selfridges, Harvey Nichols and Whole Foods and we are now in over 200 independent stores in the UK. Their success in UK market depends on this three factors Geographical location of UK, Quality of food they produced in Ireland and UK consumers like Irish products(Glenilen Farm 2016). Glenilen Farm in Cork has signed a major contract with leading UK grocery chain Sainsbury’s to supply five lines of yogurt to up to 350 stores in Britain and Northern Ireland. The contract is worth about €500,000 a year to the Irish business and will boost its annual turnover by 10 per cent(Hancock 2017). Glenilen products is also exported to UAE markets, which accounts 1 per cent of its business. They are also trying to expand their products in European markets and research works are going on globally. Perspective: Germany Many Germans consume yoghurt on a daily basis during their breakfast routines. It is either consumed pure or as a dessert with cereals, cornflakes and fruits. Yoghurt and sour milk products are expected to see a relatively strong performance over the forecast period, despite the maturity of the category. Health concerns will benefit many products like sour milk, plain yoghurt, and soy-based yoghurt and lactose-free products, all of which are expected to see a considerable increase in volume sales. A stable development over the forecast period is expected for fruited yoghurt, which accounts for 43% of volume sales in yoghurt, as well as for flavoured yoghurt and drinking yoghurt, with only minimal change in either direction(EuroMonitor 2016).(Haywood 2015) As Article published on July 23, 2015 by Alison Haywood, a journalism Student who clearly mentioned the importance of dairy products in German culture. The guestbook of Glenilen contains many testimonials from German people stating how they enjoyed their yogurt and would definitely want them to export it to Germany and those customer feedbacks gives us an insight as to why we should enter German Market.(Glenilen Farm Guestbook). Germany being a part of EU, the European Economic Area (EEA) gives the right to export and import goods freely. This means that governments may not limit quantities of imports/exports nor restrict trade in any other way. Ambition: The ambition of Glenilen is to become a regional player and expand its current market in various other parts of Ireland and furthering its globalization scope to other European markets as well. In the light of Brexit, Mr. Kingston said it would look to continental Europe for growth opportunities, notably Germany, where Kerry gold is the leading branded butter in the market. He said, “There might be an opportunity to piggyback off the success of Kerry gold,”(Small businesss ideas - Glenilen Farm 2015). This gives us an insight on his future venturing destination and the emphasis on the significant rise of other Ireland’s manufacturing company Kerry gold. Justification: The idea of entering the German Market should be based on the following criteria, the amount of German market which should be targeted during the first few years. As GDP per capita (2016) of Germany (41,936.06 USD) is less than Ireland’s (61,606.48 USD), there must be a significant cost cut which is to be considered while marketing and budgeting the product in low-high income group(Trading Economics 2017). This also includes the income group of young people around the age of 20-35, which by the report from Euro monitor clearly underlines the consumption of dairy products increasing in contrast to older people appetite to dairy foods. While the product is new to the foreign market, several Ad campaigns needs to be analysed and promoted 6 months before the launching the product in the form of discount coupons and tie-up with local retail shop to create an awareness and anticipation among the people regarding the range of dairy products available from our company. The company while entering Germany will have to joint venture with various other dairy giants such as Muller or Zott to open their markets or enter the frame by investing their shares in supermarket chains for the initial growth. The value proposition in the new market should emphasize on the quality of the product as to why the customer should buy from us in opposition to other brand in the market and to focus on the set group of people with proper customer feedback to grow and understand the trend in the market. This will enable us to hold an interest among the people and gives us an opportunity to grow in the German market.   Positioning: Initially we had a plan of entering in to four major countries in Europe to expand our global market. The countries are Germany, France, Poland and Ukraine. The Glenilen have idea of entering into German market due to three major factors >geological location of Germany >German people encourage more organic products than inorganic >they are mostly health conscious in buying things Glenilen one of the Irish dairy product which has low volatile content in it which is good for health As direct entry into the German market is highly competitive because of availability of huge number of organic products are already available in the market as a new company it is a better decision to have a joint venture with one of the leading company in the market hence forth we have chosen LIDL and Schwarz group in Germany who would establish our product and could also give us a good reputation in the market .As people in Germany has a major focus towards brand loyalty and consumers prefer “discounters” who could give them a good and quality product in the market for competitive price. As the point of entry into the market would not a major risk factor with us due to joint venturing with a multinational marketers in Germany. Joint venture will be the best option to enter Germans market. Since Germany is already a developed country. Join venturing will be a challenging task for us to accomplish. LIDL and Schwarz are the two companies we are targeting. We need to make sure that we maintain a good relationship with these companies by providing and maintaining good quality products and having highly professional candidates to communicate with them. To kick-start our product in the market we are planning to provide good discount rates for all the products initially. As consumers get more used to our products, we can reduce the discount rates. The discount rates should not go below our expected profit margin and also the consumer should not feel the product is of cheap quality. We should make sure that our product should be at easy reach of consumers for example our products should be sold at local super markets, grocery stores etc. As we have huge number of competitors for milk products in the market we need to make sure our products get more focus by customers. This can be accomplished by provide better quality at a cheaper price. PORTER’S FIVE FORCE: >Competitive rivalry Lidl’s competitive marketers in Germany such as Rewe group and Edeka even though they offer a good variety of organic content to the market some time it is being reported that there are certain products which had failed the quality standards test as well these competitor’s don’t offer a good discount as well not known in other markets in the European union as Lidl is being known in UK and other members of the EU. (EDEKA – Quality standards, Hobbs 2016, REWE-Zentral-Aktiengesellschaft) >Supplier power As joint venturing with Lidl can give us a good reputation in the market as its being a well-established supermarket (discounters) which can offer a good brand value to the product and can gain a good reputation for the product in the German market. And many of the population in the German market prefer to go for discount markets. Lidl has also established a good name in the market through providing awareness to the people of Germany to fight obesity through “hope to help fight obesity “program which informed customers regarding health awareness.(Germany: Are Rewe and Edeka better than the discounters?, How German discount supermarkets hope to help fight obesity 2017) >Buyer power It offers customers with good and qualitied product in the market and with the good discounts which help customer to understand and get a clear view where they could get the same product and a good price as Germans prefer loyal branding Lidl has a clear knowledge about what their requirement and procures the product as per their requirement in a good competitive price. More consciousness about organic products also gain a good market for Lidl’s market. (Two cheeses in one bite 1998, Germany loves dairy desserts 2010) >Threat of substitution As the taste of German people being unpredictable the company should always bring new ideas how they can market their product to the customer in order to catch the target list of customer as they are not aware of the product .If the company have done good Research and developed Good and Enrich products in Dairy which has high nutritious products can be greater substitution to the Glenilen.(Crawford 2015, Paul) >Threat of new entry Upcoming products such as Gluten free drinks, Sugar free products and Dairy products which could bring health benefits reducing the rate of diabetics, obesity and celiac diseases by metro group and DMK these could be the major threat which they have not taken into account while entering into Germany market.(GTAI, The Benefits of Sugar-Free Eating and Cooking)     Cage Framework:   Cultural  
Ireland Germany
Language English German
Religion Christianity-89.7% No religion-5.9% Others-4.4% Lutheran-34% Roman Catholic-32.5% No religion-18% Others-15.5%
Ethnicities White Irish Asian Polish German Turkish
Population Growth Rate 1.15% (2017) -0.16% (2017)
Administrative distance
Ireland Germany
Political and Economic union European union European union
Taxation Tax free Tax free
Political Stability Stable Stable
Relationship Strong Strong
Exchange Rate No Effect No Effect
Geographic distance
Ireland Germany
Time zone GMT+1 GMT+2
Geographic location Northern Europe West-Central Europe
Geographic Size 84,421 km² 357,376 km²
Neighbors Closest neighbors are Northern Europe ,whales,Scotland,England Closest neighbors are Luxembourg,Netherland,Belgium,Czech Republic.
Water Bodies Ireland has the Atlantic Ocean to its west, the Celtic Sea to the south, and the Irish Sea separating it from England to the east. Baltic sea in North-east and North sea in North-west of Germany
Landlockedness It is only connected to Northern Ireland to the North Germany is connected to 9 European countries
climate  Climate of Ireland is mild, moist and changeable with abundant rainfall and a lack of temperature extremes  Climate of germany is moderately continental, with cold winters.
Transportation  Bus transport is the main form of public transport common in all cities. The cities Dublin,Cork,Limerick and Galway all have their own suburban rail networks U-Bahn (underground train) and S-Bahn (suburban express train) are usually main mode of Transportation. Nonetheless, buses are the most common type of public transport in Germany
Overall geographic distance
  1. No common boundaries.
  2. Germany is about 5 times bigger than Ireland.
  3. Both countries have efficient and modern transportation system
  4. Ireland is landlocked from the north side as compared to Germany which land locked from all the three sides except the north.
  5. Seaports may prove most successful
  Economic distance
Ireland Germany
GDP 294.1 billion USD (2016) 3.467 trillion USD (2016)
GDP per capita 61,606.48 USD (2016) 41,936.06 USD (2016)
Growth Rate 5.2% 1.9%
Inflation 1.8% 0.2%
Debt 75.4% of GDP (2016) 68.3% of GDP (2016)
Currency 1 USD =0.85 Euro 1 USD=0.85 Euro
unemployment rate 3.9% (Apr 2017) 6.4% (Apr 2017)
 Income per capita USD 22,969 USD 31,925
Industries and Trade Export =128 Billion Packaged Medicaments, Nitrogen Heterocyclic Compounds Import=75.2 Billion Planes, Helicopters, and Spacecrafts Export=1.32 Trillion Cars, vehicle parts. Import=1.05 Trillion Crude petroleum, Packaged Medicaments
                  Organizational Value Chain: A value chain is a series of activities that an organization carries out to create value for the product as well as for the Customer. Porter’s value chain focusses on chain of activities which are classified under into two categories namely, Primary activities and Support Activities. Porter's Value Chain Diagram PRIMARY ACTIVITIES: Primary activities relate directly towards the manufacturing, maintenance and services involved in making a product. It includes the following:
  1. Inbound Logistics: These are the processes related to receiving the dairy products which are milk, Fruits, Cream, Sugar, Packaging and storing the products internally in a refrigerated warehouse.
  2. Operations: These activities include transforming the inputs to outputs which in our case is converting them into Yogurt, Milk, Cheese cake, etc. to be sold to the customer. Operations System creates value to the product.
  3. Outbound Logistics: the process of delivering the products to the customer, which could be through Shipping them via refrigerated vehicles to retail stores or storing them at a local store-room.
  4. Marketing and Sales:  Promotion and Advertisement campaign which could be used to persuade customers to buy from us rather than the competitors, here pricing strategy plays a key role by selling them in discounts and a lesser value at the initial stages. For such, we need to conduct surveys outside retail stores and give information about our product that would influence them to consider our products.
  5. Services: The aftersales service we provide to the customer in terms of feedback regarding the taste, quantity, quality, etc. and to provide them with refunds if the products falls short of health regulations.(Mind Tools team 2017)
SUPPORT ACTIVITIES: These activities support the primary activities directly or indirectly and play an important part in organizing the chain.
  1. Procurement: The primary resources require to operate, this includes finding vendors and negotiating for a best price, the use of proper inventory to control the products.
  2. Human Resource Management: A company recruits, hires, trains, motivates, rewards, and retains its workers. Wherein in our case we require a marketing team and few sales representing members to accomplish the given job.
  3. Technological Development: The machinery used to preserve the dairy products and innovating new methods to computerized farm technology. To develop sub-forums at our main website to create awareness and socializing our product in to the market.
  4. Firm Infrastructure: This holds the base operation of the organization and acts as a company’s support system, which in our case is the Animal grazing housing, the inventory base and the virtual shipping yards.(Porter 2001)
                                              HRM Plan These days dairy farmer not manages most effective cows. Increasingly more, the present farmer is coping with people as lots, or maybe even extra, than they're handling cows (Schwartau 2012). The company wants a strategic plan to ensure his German branch to get the German market need of the organization (University of Minnesota 2011b). HRM strategic plan must be based totally at the strategic plans of the company and of the branch. Once the strategic plan is written, the HR professional can begin work on the HR plan (University of Minnesota 2011a). Human resources (HR) is the activity function that manages employee in the company through presenting a collection of activities and rules and strategies, which relate to growing, utilizing, retaining and maintaining an appropriate number, and abilities, of personnel to perform your organizations goals. Glenilen farm could implement human resources into their farm by means of making a human resources plan. It may include: Farm Strategy
  • We are viewed a significant area according to assignment between our community and the agriculture industry.
  • If anyone asked about the farm and present or past employees, they would give positive feedback farm.
  • Company staff members are inspired to attend events related to agricultural, career shows, and promote the farm.
  • Every year, Company leading a staff members satisfaction survey to understand employees need and feeling about Company.(University of Minnesota 2011a, p.p4)
  • HR department continually maintain their eyes and ears open for possible future staff members.
  • Company has built-in a campaign to attract people.
  • Company will offer bonuses to the staff members who refer modern hires to us.
  • Company willing to arrange training for the candidates who is new in agriculture field.
  • More than one staff member from the company will take participate among interviewing a new candidate.
  • More than one staff member from the company will involve among selecting process.
  • company makes use of behavioral-based questions in interview to confirm their interviews are effective.
  • Company will conduct a program for the new employee orientation.
  • Company perform a good impact throughout a new staff member’s first week in the farm.
  • Company rules for training new staff member is designed according to instill values.
Management and Leadership
  • Farm managers have training to be effective leaders.
  • Farm managers or supervisors are good motivating for the new employees.
  • Managers conduct regular employee’s meetings that should be informative.
  • Company main techniques to avoid losing a valuable staff member.
  • Company helps their staff member to achieve their career goals.
  • Supervisor or managers will meet their staff members on the regular basis to discuss their problems, needs and wants.(University of Minnesota 2011a, p.p5)
Conclusion Glenilen is dairy farm based farm in Drimoleague West Cork, Ireland. Glenilen have an ambition to expand their business across the national border. Till now they have expanded their business to UK and only 1% of production to UAE. The ambition of Glenilen is regional player and they want to expand with their business to other European market that is Germany. The reason for choosing German Market is due to high GDP per capita (41,936.06 USD in 2016), fifth largest purchasing power parity, political and economic stability and good infrastructure along with strong relationship with Ireland. In addition, they have also same currency and both countries are members of European Union which will give free trade among countries. The German people are very conscious about their health and them like organic food as compared to inorganic. Due to high competitiveness, we cannot entry to German market directly; we will joint venture with LIDL and Schwarz group in Germany which will give access to market. Due to which we will get easily access to consumers due to their high reputation. There are different ways for exporting our product Ireland to Germany but for Glenilen Company the shipping will be most efficient and cost effective. From the sea port they will transfer through different vehicles with proper refrigerator. Once our product reaches to LIDL and retail stores we will give different Promotion and advertisement at the beginning for attraction of customer toward our product. We will also get feedback from customer in term of taste, quantity and quality and then company will also respond according to own ambition. To expand our business, we will recruit different people through advertisement online. So we will recruit those people who can speak German and English for better communication between head office and German local people. The main objective of our project is to expand Glenilen into German market with the help of these analysed data and increase the market size in the coming 10 years.     References: adamkasi 2015. PESTEL/PEST of Dairy Industry. Crawford, R. 2015. Lidl and McDonald’s shortlisted for motivational benefits. Employee Benefits, pp.1–1. EDEKA – Quality standards. Available from: http://www.edeka-verbund.de/Unternehmen/en/gesellschaftliche_verantwortung/sortiment/qualitaetsstandards/qualitaetsstandards.jsp [Accessed November 2, 2017]. EuroMonitor Dairy in Germany. Available from: http://www.euromonitor.com/dairy-in-germany/report [Accessed October 18, 2017]. Germany - OECD Data. theOECD. Available from: http://data.oecd.org/germany.htm [Accessed October 12, 2017]. Germany: Are Rewe and Edeka better than the discounters? Available from: http://www.freshplaza.com/article/104818/Germany-Are-Rewe-and-Edeka-better-than-the-discounters [Accessed November 2, 2017]. Germany loves dairy desserts. 2010. Dairy Industries International, 75(9), pp.8–8. Glenilen Farm | Glenilen Farm Products | Glenilen Farm Guestbook. Available from: http://www.glenilenfarm.com/guestbook/ [Accessed October 15, 2017]. GTAI Industry-overview-food-beverage-industry-en.pdf. Available from: https://www.gtai.de/GTAI/Content/EN/Invest/_SharedDocs/Downloads/GTAI/Industry-overviews/industry-overview-food-beverage-industry-en.pdf?v=7 [Accessed February 11, 2017]. Hancock, C. 2017. Glenilen Farm signs €500,000 yoghurt deal with Sainsbury’s. The Irish Times. Available from: https://www.irishtimes.com/business/agribusiness-and-food/glenilen-farm-signs-500-000-yoghurt-deal-with-sainsbury-s-1.3098006 [Accessed November 23, 2017]. Hancock, C. Glenilen Farm signs €500,000 yoghurt deal with Sainsbury’s. The Irish Times. Available from: https://www.irishtimes.com/business/agribusiness-and-food/glenilen-farm-signs-500-000-yoghurt-deal-with-sainsbury-s-1.3098006 [Accessed October 18, 2017]. Haywood, A. 2015. What I learned about German food culture by working at a supermarket. Cafebabel. Available from: http://www.cafebabel.co.uk/lifestyle/article/what-i-learned-about-german-food-culture-by-working-at-a-supermarket.html [Accessed November 2, 2017]. Hobbs, T. 2016. Lidl Shifts Focus to Food Provenance. Marketing Week, pp.8–9. How German discount supermarkets hope to help fight obesity. 2017. Available from: https://www.thelocal.de/20170717/how-german-discount-supermarkets-hope-to-help-fight-obesity [Accessed November 2, 2017]. Mariton, J. 2017. What is scenario planning. Available from: http://www.smestrategy.net/blog/what-is-scenario-planning-and-how-to-use-it. Mind Tools team 2017. Porter’s Value Chain. Understanding How Value Is Created Within Organizations. Available from: https://www.mindtools.com/pages/article/newSTR_66.htm. OEC-GERMANY 2016. OEC - Germany (DEU) Exports, Imports, and Trade Partners. Available from: https://atlas.media.mit.edu/en/profile/country/deu/ [Accessed November 18, 2017]. OEC-IRELAND 2016. OEC - Ireland (IRL) Exports, Imports, and Trade Partners. Available from: https://atlas.media.mit.edu/en/profile/country/Irl/ [Accessed November 18, 2017]. Glenilen Farm 2016. Our Story. Glenilen Farm. Available from: https://www.glenilenfarm.com/our-story/ [Accessed November 23, 2017]. Paul, K. Food safety :  A matter of taste ? Porter, M.E. 2001. The value chain and competitive advantage. Understanding business: Processes, pp.50–66. REWE-Zentral-Aktiengesellschaft Organic Products. Available from: https://www.rewe-group.com/en/nachhaltigkeit/gruene-produkte/bio/ [Accessed November 2, 2017]. Schwartau, C. 2012. Human resource management on modern dairy farms. Available from: https://www.extension.umn.edu/agriculture/dairy/employees/human-resource-management-on-modern-dairy-farms/ [Accessed November 9, 2017]. Small businesss ideas - Glenilen Farm. 2015. Think Business. The Benefits of Sugar-Free Eating and Cooking. Available from: https://www.thespruce.com/benefits-of-eating-sugar-free-3151643 [Accessed November 22, 2017]. The World Factbook — Central Intelligence Agency 2017. The World Factbook — Central Intelligence Agency. Available from: https://www.cia.gov/library/publications/the-world-factbook/geos/gm.html [Accessed October 27, 2017]. Trading Economics 2017. Germany GDP per capita | 1970-2017 | Data | Chart | Calendar | Forecast. Available from: tradingeconomics.com/germany/gdp-per-capita [Accessed November 23, 2017]. trading economics Trading Economics Analytics Signup. Available from: https://tradingeconomics.com/analytics/features.aspx?source=chart [Accessed October 18, 2017]. Two cheeses in one bite. 1998. Dairy Industries International, 63(9), p.6. University of Minnesota 2011a. 2.2 Writing the HRM Plan | Human Resource Management. University of Minnesota 2011b. Chapter 2: Developing and Implementing Strategic HRM Plans | Human Resource Management. World Development Indicators - Google Public Data Explorer. Available from: https://www.google.ie/publicdata/explore?ds=d5bncppjof8f9_&met_y=sp_pop_totl&idim=country:DEU:FRA:GBR&hl=en&dl=en [Accessed October 12, 2017].                                                       Appendices-1 Pestle Analysis
Political factors
  • Political stability
  • Federal and local government
  • Local government deal business policy
  • Member of European union, OECD and UN
  • Free trade between Ireland and Germany (European union members)
Economics factors
  • GDP  3.467 USD in 2016
  • GDP growth 0.6 in 2017
  • Fourth largest economy
  • Fifth largest purchasing power parity
  • Per capita income 41,902 $
  • Moderate tax
Social factors
  • Better standard of life
  • Like organic food
  • Largest population in EU
  • No differentiate among local and foreign food
  • Organizing different sports events
Technological factors
  • Technological advance
  • Good infrastructure
  • Majority population internet access
Legal factors
  • Ban on false advertisement
  • Label of production country (European union rule)
  • Ingredient  information
  • Proper size
Environmental factors
  • Cooling place
  • Free from disease
  • Serious care
  Whenever the company wants to expand their sales or their ambition to go beyond the border, so they are using different trends for analyzing the opportunities and risk which include Pestle and SWOT analysis. Here we will analyze the PESTLE analysis of Germany for Glenilen Company: Political factor: Germany is a democratic country with federal government.  They have federal, state and local government. So, the local government also deciding the taxes and business policy.  It is also member of European Union, IMF, UN, and OECD. Due to member of European it will be an advantage for the Glenilen Company that they can export their product regardless of any tariff and taxes. Now a day the Glenilen company export their product to UK, so after Brexit so, there will be some taxes on their product which will affect their price. Furthermore, political stability play an important role in every business. When we see the political system of Germany so it is very stable and their policies is not changing quickly for the businesses. Economics factor:  Germany have the largest economy in the Europe. It GDP was 3.467 USD in 2016 and its growth 0.6% in 2017 and per capita income of Germany is  41,902$ (Germany - OECD Data). Germany is fourth largest economy by nominal and fifth largest purchasing power parity.  So it shows that the Glenilen Company can maximize their sales and get more profit due to largest economy and purchasing power parity. If the Glenilen will do to establish own manufacturing plant in Germany so the tax rate in Germany is moderate but it is high as compare to Ireland. It is also largest exporter and importer. Social: Social factor can also affect the business like the standard of living and their trends. It is one largest country regarding population and people have diversity cultures. It population was 82.66 million in 2016 (World Development Indicators - Google Public Data Explorer) According to OECD report, the German very concern about their health and they are also very healthy.  The German don’t differentiate their local and foreign product. They are also organizing different sports events. So, these factors will also contribute in increasing of their sales for Glenilen Company. Technological: Germany is one of the technological advance country. The infrastructure is very strong in Germany, so it will play a great role in advertisement and promotion of Glenilen products. Majority of people have internet access. Moreover, due to high technology they might face some problem like they will compete in appropriate way but, on the hand they will learn these farm which will provide a base for creativity and improvement in their product. Legal: According to the law imposed to the dairy industry by the dairy administrative of the European Union the manufacturing product should contain the labelling of the production country. They should also not make any false advertisement of the product. They should obey the laws imposed by the country where the product is being exported. The dairy product should include calorie count, serving sizes, number of serving per container as well as nutrient information.(adamkasi 2015) Environmental Change in atmosphere and climate is one largest problem for the world. The German government has ambition and has different policies to waste and emission of pollution. The Glenilen product are most depend on natural resources, so it will also be an aim of Glenilen to reduce the waste and utilize the resource because the world is facing scarce resources. The Glenilen will use those material in packing which will recyclable.                     Appendices-2 Scenario Planning: Positive scenario: As German taste is preferably inclined towards the usage of natural products in their day to day activity and our company is as well inclined towards the same it’s a good opportunity for us while entering into their market with a low cost as it would be a good strategy to be followed entering into the new market. The second most beneficial factor while considering the German market is that the government provides company with certain subsidiary if the R&D team who analyse the quality of products get them the information about how beneficial our products are and how updated we are in technology usage. Negative scenario: During the initial period, if Glenilen invest more in the market with the knowledge of who their competitors are they would face a huge loss due to improper analysis but if they have already foreseen the situation and they have planned accordingly there won’t be any of these kinds of losses and the best strategy to be followed while entering into the new market is to make people understand what the value of product is and create a huge demand to the product thus attain success. Political: If there is any political instability after few years, Glenilen needs to be ready to face the situation such as there might be different situation wherein the power from one party might transfer to another, FDI policies would be changed, Import regulations would also be major factors which needs to be considered while taking this into account while entering into the German market. Environmental: The main factor which needs to be considered is the loss to the company due to environmental factors such as there might be loss occurring to the company while they transport goods from the warehouse such as due to sudden natural disasters such as floods, earthquakes, Tsunami and many other factors etc. The company needs to be ready while moving into a new location by considering these factors. Quality Control: Initially the product’s quality and quantity as well as the price is feasible to the Customer, Once Glenilen gain the market share value in the next 5 years, they should make sure that all the quality assurance is met and there are regulations considered at every intervals of packaging, also by not compromising on the quality due to excess demand created in the market which could result in market decline.(Mariton 2017) Partnership: Joint venturing with only one retail stores or Supermarket is risky, If Lidl causes a setback in the market due to any political, economic, social reasons, etc. Company should keep alternatives with other stores like Muller or Zott as backups so that our growth in the German market is not much affected with such issues.                                                     Appendices-3 CAGE Analysis Cultural distance: Culture is the way of living. Different countries have different cultures. So, its show their belief and norms. When we talk about Germany, their language is German, but the majority of people can understand English specially their young generation. So, the ratio of understanding English is higher in cities as compared to village. In Germany, there are different Ethnic groups that is 91.5% German and Turkish 2.4% and other 6.1%. The majority of Germans do not differentiate local and foreign foods, but they give preference to quality. So, our food is natural it will be our competitive advantage. Moreover, there is more trust between Ireland and Germany and they support each other. Both countries have people from different religious group, where the highest ratio being Christianity.(The World Factbook — Central Intelligence Agency 2017). Administrative distance: Our farm is an Irish farm and we want to expand business to Germany. When we talk about Germany and Ireland so both countries are in European Union and there will be no tax for exporting our product due to free trade.  In addition, both countries are members of different trade organization and different blocks. The currency of both countries is euro which will also give advantage and no need of exchange rate. They have political stability and strong relation between two countries. Geographic distance: Both Ireland and Germany don’t much time difference, both countries have 1 hr. difference where Ireland is 1 hr. ahead of GMT and Germany is 2 hr. ahead of GMT. Both countries are located in Europe, where Ireland is in northern part of Europe and Germany in West-Central Europe. The shortest distance between both the countries is 1,296 km or 805 miles. As Germany is close to Ireland in terms of Geographic distance, the transportation cost or logistics will be reduced. As both the countries are not connected by land. so, the most economical mode of transport between both the countries will be by water as it is the cheapest  mode of of transport as compared to airways. Economic distance: The Gross Domestic Profit (GDP) of Germany is 11 times more than that of Ireland valued at 294.1 USD Billion and 3.467 USD Trillion. Germany has the largest economy in Europe. The Tax rate in Germany is moderate but is high as compared to Ireland. There is no currency difference between both the country, hence the fluctuation of exchange rate won’t be affected. As compared to growth rate, Ireland has 5.2 % growth rate, which is 2.7 times more than Germany. The unemployment rate of Germany is more as compared to Ireland. Import and export of goods in Germany is 1.32 and 1.05 trillion respectively which is higher than Ireland at 128 Billion and 75.2 Billion(OEC-GERMANY 2016, OEC-IRELAND 2016). Appendices-4 Organizational Value Chain                     Appendices-5 Cultural Web: Story:
  • The core of the story is to market GLENILEN initial products yogurt and soft cheese in German markets.
  • The story deals about success and failure of the marketing practices
  • The héros of the story are GLENILEN and the villains are the rivals for example Rewe group
  • There is more demand for organic products in Germany that non-organic product.
Routines and Rituals:
  • The Globalization scope routine is explained the daily usage and percentage use of dairy products every day in the market.
  • There will be a change in political economical and technical factor.
  • By providing better quality products than the rivalries we can sustain the market.
  • Better quality, less price and joint ventures are the key factors.
  • Gluten free drinks, Sugar free products and Dairy products which could bring health benefits reducing the rate of diabetics, obesity and cellar diseases by metro group and DMK these could be the major threat which they have not taken into account while entering into Germany market
Control Structure:
  • Decreasing profits, Change in customer taste, increase in competition, Lack of financial resource,; Inadequate partners for cooperation, Increase in cost for production are some punishments that we can face if we fail to satisfy the customer’s needs.
  • Change in population age structure, Growing demand on cheese, Expanding the product range, Increase of market share, Large and still increasing target group Predicted growth of bio products are the rewards that we can expect for successful production.
  • Quality of the milk products like yogurt, cheese and the quality and amount of fruit that are to be mixed in yoghurt are to be closely monitored with caution.
  • We have many controls such as control over pasteurization, control on fruit quantity, cheese bacteria production etc.
Power Strategy:
  • Change in population age structure, Growing demand on cheese, Expanding the product range, increase of market share, Large and still increasing target group, Predicted growth of bio products are considered to be formula for success
  • Big competition, language barrier, Raw milk cheese is an upcoming trend, people are very brand loyal, improper labelling in nutritional product should be taken care are some barriers for the change
  • The power equals is distributed over the organization for example from people who is buying the products to people who is selling in the market.
  • The beliefs are to maintain the quality of the dairy products and to deliver the dairy products as soon as possible, as dairy products like fresh milk cannot hold well for a long time.
Organisational structure:
  • The organisational structure in Glenilen is flat type where is no or fewer level of management between staff level employees and management.
  • As Glenilen is a small company with around 30 employees the salary of the middle management is reduced thereby reducing the cost of the organisational budget
  •   Current competitors in the market and delivering products like fresh milk within a short period of time will be the challenging factors.
  •  As fresh milk can expire within short period of time, these produces should be delivered in a express manner so that we can maintain the quality of the product.
  •  Other products like yoghurt can be delivery in a normal delivery as they have longer expiry time. By providing better quality than competitors we can sustain in the market.
  • The organization is symbolized by the logo of a bull, depicting cows are the major source for the dairy products.
  • This is a formal and a conservative organization with equal power on all the levels.
  • Best quality of the product at cheaper prize than rivals are highlighted to the public.
  • Since these are dairy products depending on the number of joint venture and buyers we can make this product mare accruable to the public
                      Appendecies-6 SWOT Analysis
>Well educated about cheese >Member of the European union >No import regulations >High focus on bio and organic products >Preference for high quality goods >Well-developed distribution grids >Strong economy and high population >Good trade and business relations joint venturing with LIDL has a good opportunity to acquire market >Lidl known for its discount in products >Big competition >language barrier >Raw milk cheese is an upcoming trend >people are very brand loyal >improper labelling in nutritional product should be taken care >less in grocery sales compared to Rewe group and edeka >No good control over self-liquidity finance (SLF)
>Change in population age structure >Growing demand on cheese >Expanding the product range >Increase of market share >Large and still increasing target group >Predicted growth of bio products >Distribution through supermarket such as LIDL can have a good hand over the market as  they are present in our current expanding as well our ambitioned location >Decreasing profits >Change in customer taste >Increase in competition >Lack of financial resources >Inadequate partners for co operation >Increase in cost for production and logistics as it is less connected with water channels >Demand is much higher than supply >Bacterial case damage the image >Lidl Faces a big time competition from other firms such as Rewe and Edeka and Alnatura

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