PESTLE Analysis of Zimbabwe for Business Expansion

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Country Notebook: Zimbabwe

Introduction

Zimbabwe is a landlocked, developing country that is located in the tropical regions of Africa. The population of the country is approximately 16.15 million as of 2016. The population of men within the country is approximate 49%, which is an estimate of around 8,165,446, while that of the female is approximated to be around 50.7%, a total of 8,388,669 (Hatzold et al., 2016). Citizens age 0-14 account for 41.38% of the population, while citizens ages 15-64 make up 55.81% and citizens ages 65+ make up 2.82% (CIA World Factbook). 32.277% of the population is located in urban areas, and the annual rate of urbanization sits at 2.44% (CIA World Factbook). Zimbabwe’s GDP per capita is around $2,300 (2017 est.) and 60% of workers are in the services industry. 49.7% of the income is held by the highest 20% of the population and 5.8% is held by the lowest 20% of the population (Global Edge). Therefore, with that data in mind, Zimbabwe is viewed to be a diverse and also a viable place for development and the realization of businesses in the long run. It additionally has a wide variety of minerals such as gold, platinum group medals, and chromium (Mindat).

Zimbabwe also has an effective transportation network, with 3,427 km of railways and 97,267 km of roadways. Their communication network is mainly mobile cellular and 23.1% of the population has access to the Internet (CIA World Factbook). The country is rated as high risk for foreign investment, but an increased number of foreign investments could see to it that the economy of the country is well maintained. Additionally, other aspects that impact the region as a whole include the media, which include television costs, radio costs, print and the Internet. The government of Zimbabwe controls the majority of the country’s media outlets. The government will greatly determine how much a business will invest in the region. In addition, the inflation rates (annual 2.5%, 2017 est.) within the country are alarming since Zimbabwe is a developing country, and as such, it faces a number of economic troubles (CIA World Factbook). This notebook is created to act as a guide for Clorox Company if they decided to do business in Zimbabwe. But, in the current climate Zimbabwe is not a country that is recommended to enter into.

Political Analysis of the Country

Zimbabwe is a presidential republic. The President is elected by the public and acts as the head of state and the executive branch of the government. The government is split into 3 branches: the legislative, judicial, and executive branches. The legislative body of Zimbabwe consists of 120 seats that are elected by the public. The head of the judicial branch in Zimbabwe is the Chief Justice of the Supreme Court of Zimbabwe, who is selected by the President. There are many political parties in Zimbabwe, but the main ones are the Zimbabwe African National Union- Patriotic Front (ZANU-PF) and Zimbabwe African Peoples Union (ZAPU).  Recently, Robert Mugabe has stepped down as President of Zimbabwe, with Emmerson Mnangagwa taking his place. In general, the politics in Zimbabwe are unstable and attribute to the lack of infrastructure and poor living conditions of its citizens (Pariona, 2016).

The government of Zimbabwe has received significant financial assistance from several foreign entities in hopes of trying to curtail quickening financial decay and national emergency. As citizen struggle to survive in a crumbling economy, Zimbabwe faces a race against time to create necessary legislation to enact the building of important infrastructure that would also provide more employment opportunity. Zimbabwe desperately needs the help of global organizations such as the International Monetary Fund (IMF) and financial specialists; however, their help will rely upon legislature authorizing an extensive monetary and political change program. For the overwhelmed ZANU-PF government, the economic revitalization plan is necessary to its own political survival. However, as Zimbabwe moves towards a new post-Mugabe era, this struggling nation is in the beginning phases of a watershed.

On the other hand, political vulnerability strikes Zimbabwe in a time when extreme drought plagues most of Southern Africa. Downpours have fizzled, the government is under severe pressure to provide clean water, and agricultural production is significantly lower than normal. About 4.07 million individuals in Zimbabwe have shaky nourishment, and about 33,000 kids are in critical need of treatment for an extreme lack of healthy sustenance. The stakes are high due to social and monetary flexibility being undermined by past emergencies and many years of poor administration.

Zimbabwe’s financial yield split in the vicinity of 1997 and 2008 (Manyani et al., 2014). The selection of a multi-cash framework in 2009 controlled the nation’s scandalous hyperinflation and brought relative monetary steadiness and a time of solid development in genuine total national output (GDP). Nonetheless, auxiliary inadequacies and a long history of political fumble had deindustrialized the economy, and the new development rate was unsustainable. Zimbabwe is presently under a triple danger of collapse, monetary stagnation and low profitability, exacerbated by a set of low worldwide costs for its fare wares, powerless local monetary forms and dry season.

Zimbabweans are living in a circumstance of extraordinary destitution. Half of the nation’s provincial populace will require sustenance help by 2017(Zamisiya, Mango, and Siziba, 2014). In urban zones individuals are depending on ‘tsaona’– little parcels ordinarily of sugar, mealie dinner or rice, costing around 5 rand, which is identical to $0.35 – to get through the day. The nation has been in monetary emergency previously, yet this time the circumstance is more awful. In the hyperinflation emergency of 2008, ‘there was a fallback position’, yet now, without such possibility, ‘the emergency is hitting profound the normal individual’ (Lestari and Sander, 2015). In 2008 numerous residents could make due by utilizing the US dollar as parallel money, yet dollarization has evacuated that wellbeing net, particularly as a solid US dollar has additionally decreased the estimation of diaspora settlements. Import limitations have additionally undermined relief systems, as Zimbabweans can’t carry fundamental merchandise into the nation to exchange with their neighbours.

The ZANU-PF government is seeking to better the working conditions in order to increase the appeal of foreign direct investment. In a discourse at Chatham House in July 2016, Zimbabwe’s Minister of Finance and Economic Development, Patrick Chinamasa, underscored: We are making every effort to enhance the working condition in Zimbabwe to draw in remote direct speculation. What the nation needs at this moment is capital – new cash. The obligations and liabilities are there, and we require a methodology that can influence the economy to develop. What’s more, for the economy to develop we require outside direct speculations, which is the reason we are associated with a system to change the working condition and we’ve moved mountains in this regard (Lestari and Sander, 2015).

This ‘procedure to change the working condition’ has been bolstered by the reengagement of the universal monetary establishments (IFIs) and specialized help. An arrangement where Zimbabwe would fulfill their obligations with the IFIs occurred at the IMF– World Bank Group yearly gatherings in Lima on October 2015, with the goal of preparing for Zimbabwean qualification for spending backing and improving funds to normalize relations with the global money related community.

Money related help from the IFIs would help the administration to deal with the financial emergency. Such help may as of now be past the point where it is possible to give the nation an easy fix in its current financial crumbling, however, it can minimize the damage and act as a wellbeing net for Zimbabweans as an inevitable political progression is happening within the nations elites. Worldwide and household trust in the administration is fraying.

An advance from the IMF would not in itself be the cure-all some in the nation anticipate. Building certainty with financial specialists and banks will require political and monetary change and depoliticization of the economy. In the long haul, it isn’t monetary help from the IFIs that will change the economy, yet rather the extending of change. The sense of duty regarding long-haul change and political steadiness are crucial for transformation. The fruitful change will require a viable and bound together government focused on political and monetary goals. The continuous battle inside ZANU-PF over the presidential progression will heighten in front of the decision gathering’s congress. There is a serious danger of intra-and additionally between party brutality in the run-up to the presidential and authoritative decisions due in 2018.

Political and reputational dangers have hindered financial specialists for quite a while, however reconciliation with the IFIs, bolstered by the more extensive global groups, may turn away a collapse and cultivate new open doors for private-segment speculation. Re-engagement is without a doubt a delicate and unsafe process, with no assurance of a decent result. The IFIs have come in with feedback offering ZANU-PF a methods for survival through the monetary re-engagement process, and reformers inside the gathering have experienced restriction from people who doubt any type of joint effort with the West, and that such engagement would debilitate the country’s survival. In any case, to withdraw totally would mean further monetary decay that could prompt disorder and viciousness for Zimbabwe in an already delicate Southern Africa.

Change and re-engagement are in this way basic if Zimbabwe is to get here and now help. Be that as it may, the genuine effects will just be seen and felt in the medium to long haul as private area speculation returns. In the short term Zimbabweans, who have experienced financial instability for too many years, needs to see fast financial outcomes before they can completely focus on overall change. The test for new legislature will be to deal with the struggle between long-term incremental change and mainstream requests for quick monetary alleviation. None of Zimbabwe’s political or monetary partners can resolve the nation’s financial and political emergencies all alone. Zimbabwe’s universal re-engagement needs to supplement a national re-engagement between its own people.

Zimbabwe’s financial change and re-engagement plan has a more extensive territorial and worldwide importance. A settled economy could indeed enable Zimbabwe to be a grappled state in an area where strength is debilitating. Its direction is naturally connected with those of its neighbours, whose claim economies are stressed because of the universal item stoppage, and by local auxiliary issues, rising imbalance and the effect of environmental change. Security in Southern Africa is of importance for the more extensive worldwide group, and failure would affect South African, UK, Chinese and US interests specifically.

Zimbabwe’s monetary changes have been globally upheld. An effective change from hardline ‘devoted liberationism’ to a more down to business monetary radicalism will have significant impacts and could establish the financial frameworks for a resurgent 21st-century Zimbabwe.

Legal analysis of the country

Zimbabwe has a system of the legislature that can be argued to be hybrid, or plural, the current law was embraced from the British and forced into the nation by pioneers. Zimbabwe’s law following quite a long while of independence still uncovered remaining qualities of the procedure of transplantation of chronicled debilitation and pioneer takeover.

Zimbabwe’s Legal framework comprises of the Common law non-statutory or unwritten Anglo Roman-Dutch Law) Legislation Case Law (Precedent) and Customary Law. Except for Criminal Law, which has as of late been transformed and arranged (Matondi, 2016), Zimbabwe’s law isn’t classified. The Constitution of Zimbabwe is the Supreme Law of the nation.

Intellectual Property is protected by Zimbabwe and requires formal registration in the Zimbabwe Intellectual Property Office (ZIPO) before those rights can be protected. Copyrights, patents, trademarks, plant breeder’s rights, and industrial designs are recognized and protected by the Zimbabwe Government.

Cultural Analysis

Brief discussion of the country’s relevant history:

In the 13th and 14th centuries, Zimbabwe was one of the greatest African civilizations. The Bantu tribes, who lived a mostly pastoral lifestyle, inhabited the area.  In 1889, the British South Africa Company gained a mandate from Britain to colonize Southern Rhodesia, which is now known as present day Zimbabwe. The British intentions were to take the country’s rich mineral reserves. It was not until 1980 that Zimbabwe was internationally recognized as an independent country and joined the British Commonwealth (Global Edge).

Zimbabwe left the British Commonwealth in 2003 under President Robert Mugabe, who acted as Primer Minister from 1980-1987 and President from 1987-2017. In 2010, President Mugabe signed a new “indigenization” law that forced foreign-owned businesses to sell majority stakes to locals. In 2015, the Central Bank phased out the Zimbabwe dollar, and instead implemented a multi-currency system to attempt to counter inflation (Global Edge). The indigenization law and the multi-currency system are a couple of the many reasons that companies decide not to invest in Zimbabwe, there is too much risk involved legally and economically.

Geographical setting:

Location:

Zimbabwe is a landlocked country in southern Africa. The country straddles a high inland plateau that drops northwards to the Zambezi valley. Zimbabwe has borders with Botswana, Mozambique, South Africa, and Zambia (World Atlas).

 

Climate:

Zimbabwe is completely within the tropics, lying north of the Tropic of Capricorn (Britanica). The country experiences its warm season from August to October. Towards the end of dry season, monsoon winds cause intense rainfall in Zimbabwe when it crosses the Indian Ocean and Mozambique. The cool season for Zimbabwe lasts from May to August, with June generally being the coolest month of the year (Britanica). In all months of the year, Zimbabwe is typically very dry. A company who wants to sell products in Zimbabwe must be aware of how their products react to climate.

Topography:

The Inyanga and Udizi Mountains sit along the Eastern Border of Zimbabe, the country’s lowest and highest points of elevations are found in these mountains.

The Mafungabusa plateau covers central and east Zimbabwe, which is the majority of the land. The Matobo Hills and Chizarira Hills are north and south of the plateau.

Zimbabwe is also home to the self-acclaimed largest waterfall in the world, with a width of 5,604 ft and a height of 354 ft. Other major bodies of water include Lake Kariba, which is also located on the western border of Zimbabwe (World Atlas).

Social Institutions:

Family, Dynamics of Family, and Role of Family in Purchasing Behavior:

In rural areas the family unit is composed of the husband, the wife or wives, children, and members of the extended family. In urban areas, households are smaller, with a tendency toward a nuclear family of the husband, the wife, and children (Countries and their Cultures). Men hold the authority, but wisdom is bestowed by age. A man becomes the head of the household once married, but elders are more influential when it comes to issues around the extended family as a whole. This same hierarchy pertains to roles in purchasing behavior as well; men tend to make most of the decisions for the nucleus of the family while elders are persuasive in making purchasing decisions for the whole. Women gain more respect as they become older, and daughters-in-law tend to do most of the household and field work.

Female and Male Roles:

Men dominate the country as representative in the government and as civil servants. Only 15% of members of the House of Assembly are women. Many businesses that are in the informal sector, such as gardening, raising poultry, and baking, are a woman majority. This is important because for many households the informal sector is an important source of income. Women also outnumber men in the agricultural sector, 70% of women are smallholder farmers compared to 35% of men (Countries and their Cultures).

Education:

Role of Education in Society:

In Zimbabwe, education is important for citizens in order to attain highly sought for occupations and an economically viable salary. Families in Zimbabwe encourage high education to support the entire family, and not just ones self. There are no social stigmas attached with failing to attain a college or university degree, as long as the person has the money to support a quality lifestyle (Countries and their Cultures).

Literacy Rate

Because of this importance on education and supporting a decent lifestyle, Zimbabwe has a surprisingly high literacy rate. In 2015, the adult literacy rate increased from 77.8% in 1982 and 86.9% in 2015, with an average annual rate of 3.79% (Knoema).

Religion and Aesthetics:

Prominent Religion and Relevant Rituals:

Due to the British colonization of Zimbabwe in the 1880’s, the majority of people practice Christianity. The largest churches are the Roman Catholic Church and the Anglican Church. Traditional tribal religions are not commonly practiced and will have minimal effect on a company attempting to expand their business to Zimbabwe. But, it is important to know that people who follow the traditional tribal religions believe that the spirit of the ancestors exist and communicate to living family members (Countries and their Cultures). Thus, emphasizing the family values that exist within Zimbabweans.

Visual Arts:

Traditional art in Zimbabwe consists of pottery, basketry, textiles, jewelry, and carving. The art captures many aspects of life, and many of the tribes had their own recognizable styles and symbols. Also, decorating the body in the form of tattoos, scarification, and body paint for ceremonies is common for Zimbabweans.

Music:

Traditional music is based on the rhythms and melodies of the mbira, a finger instrument associated with Zimbabwe ancestors. This music gave ancestors feelings of solidarity in a time where they were struggling for independence. Older people generally are the primary listeners of traditional music. Younger generations are greatly influenced by global popular culture and western music (Countries and their Cultures).

Language:

Official Languages and Spoken vs. Written:

Zimbabwe holds the Guinness World Record for having 16 official languages, ranging from English to traditional African languages such as Tonga. Having so many official languages provides recognition of many cultures within the country (World Atlas). English is the primary language for the government and the public education system. But, only 2.5% of the population speaks English as their primary language. Other dominant languages include Shona and Ndebele. Approximately 70% of the population speaks Shona while 20% of the population speaks Ndebele (World Atlas). The languages that people speak in Zimbabwe tend to be the ones that they write in as well. English is also a commonly written language due to the fact that it is taught in public education.

Important Holidays, Rituals, Relevant Cultural Do’s and Don’ts:

Important Holidays:

Because of the prominence of Christianity in the country of Zimbabwe, the major holidays that are recognized are Easter and Christmas. The government recognizes these holidays as well. There are many other small holidays that the government recognizes but they would have minimal effect of a company’s ability to enter the market in Zimbabwe.

Cultural Do’s and Don’ts:

In general, Zimbabwe is a warm and friendly country that welcomes tourists from all around the world. Some things that a tourist should do when traveling to Zimbabwe are to dress appropriately and bring US Dollars. Zimbabweans are conservative when it comes to dress, it would be disrespectful for a woman to wear shorts or a skirt. Tourists should bring US dollars due to the cash shortage in Zimbabwe.

Some things that people visiting the country should not do is talk about politics, take pictures of locals without permission, and display affection publicly. Political opinion in Zimbabwe is a hazard in this country, and topics on politics are a sensitive topic due to the state of the country. Due to the conservatism of Zimbabweans, it is best not to participate in public displays of affection, such as kissing and holding hands (Kagwiria).

Market and Competitive Market Analysis

The Product

Liquid bleach in Zimbabwe has had limited obtainability in the last decade. Bringing this product to the forefront in Zimbabwe would provide a company a first mover’s relative advantage. Being the first company to bring merchandise into a country would give a business superior profit margins and monopoly-like benefits. Compatibility wise, the product itself is a good fit in the Zimbabwe market. Like all consumers, there is a need for hygiene and sanitation, so having a product like liquid bleach that has numerous purposes saves consumers money. Liquid bleach is not a complex product, and will not need much clarification in order to demonstrate to new consumers how to use it. A company could offer trial sizes of bleach and permit the consumer to use it in their home. If the consumer likes the product, then they can acquire a larger size. Liquid bleach has high marketability in the majority of countries around the world, including Zimbabwe.

 

Potential Major Problems and Resistance to Product acceptance

A developing financial emergency – portrayed by emptying, stagnation and low efficiency has been intensified by the district-wide effect of falling ware costs, dry spell and a forcefully contracting South African economy nearly subsidence. These outer elements undermine to quicken Zimbabwe’s own financial decay and could prompt a calamity. Debilitated by many years of poor administration and financial fumble, Zimbabwe has minimal remaining flexibility. The narrative of its decrease has been broadly told. Ineffectively actualized, populist and politically propelled arrive change and indigenization programs burrowed out the country economy and pushed Zimbabwe into a time of implosion (Zvobgo, 2017). In 2008 the economy shrank by almost 18 for each penny, and swelling turned out to be successfully endless – allegedly in a huge number of per penny every month, wiping out local reserve funds and ending speculation.

The biggest issue to product acceptance is the affordability of the product for consumers. The instability of the political and economic side of Zimbabwe hinders the purchasing power of the customer, thus decreasing the need or acceptance of all products in general. Since liquid bleach is affordable and has many determinations for daily life, it will be an easier transition to product acceptance than there would be for other categories of consumer products.

The Market

To begin, a company should market this product in major cities in Zimbabwe, such as Harare and Bulawayo, which have a population of greater than 1 million people. The consumers who reside in major cities tend to have greater income, thus having more purchasing power as well. If the product were to gain popularity in these cities, and profitability can be predicted, then a company can expand sales to other cities around the country. Zimbabwe is a relatively small country compared to other countries in Africa, the location that a company would bring their products to is not as vast as other places.

Forms of transportation available in Zimbabwe include plane, train, and car. There are a sufficient amount of airports, railways, and roads that a company should have no problems infrastructure wise in transporting liquid bleach. Forms of communication are cellular phones, the Internet, mail, and radio. There are enough methods of interaction for a company to increase their reach while marketing liquid bleach to consumers.  Both the transportation and the communication are available in the major cities in Zimbabwe.

Consumer Buying Habits

The buying habits in Zimbabwe are reflected upon the culture and values that they hold. Zimbabwe culture involves the family at its nucleus, so Zimbabwean consumers purchase products for the entire family at a time. Although Zimbabweans purchase products for the whole family, they do so in a cost effective way, only getting the minimum amount of the product. This is mostly due to the harsh financial conditions that the majority of the population is in. Two questions that marketers in Zimbabwe should ask themselves are: Does the product have long-term affordability? And can the whole family use the product? Liquid bleach is one of those products that marketers can say yes to those questions.

Distribution of the Product

The product of liquid bleach would be sold in convenience stores, grocers, and supermarkets. Customers would go into their typical store, and see a stand where they can obtain free trial size packets of liquid bleach, as well as an option to purchase the product right away at the store. Having a stand inside store increases brand awareness of the product to a new population of consumers.

Another way to market the product would be to offer affiliate marketing. Individual people in Zimbabwe can advertise the product to people that they know, and receive a percentage of the sales of the product when successful. This program would be a long-term investment, because a company would need to see how viable the financial market is and how much of an improvement it will have on the lives of people participating in the affiliate program.

Advertising and Promotion

The medium that is typically used in Zimbabwe is print advertising. Since many Zimbabweans do not have fast access to the Internet or a phone, having a print ad that can be passed out assures that consumers are aware of the product or have at least seen the print advertisement itself. Another form of advertising that is typically used is TV advertising. There are many commercials that feature products that are sold in Zimbabwe. But, one issue with this method is that government approval is needed in order to get the commercial to air on TV. The government in Zimbabwe controls TV and Radio media. If a company can make it in the government’s best interests to have a commercial for liquid bleach, then this form of advertising would be sensible to implement as well.

In Zimbabwe, sales promotions are not commonly used. Zimbabweans typically do not take advantage of “buy one get one half off” deals. Coupons would be the best way to market to Zimbabweans. Marketers can provide coupons with the print advertisements for customers to use. Then, customers can bring those coupons into the store with them to receive a discount on a liquid bleach product. This method is easily implementable in Zimbabwe and will provide the greatest reach compared to the more expensive forms of promotion.

Pricing Strategy

The cost of a typical 121 oz. bottle of Clorox Bleach costs about $3.97 US. In order to make this product affordable for Zimbabweans, a company should decrease the size of the bottle, thus decreasing the price of the product. Selling a 59 oz. bottle for $1.50 US or 542.850 Zimbabwe Dollars will be more effective in sale compared to selling the larger 121 oz. bottle. The product itself is relatively cheap, so there will be less concern on the cost of goods and the profit margin. It will be good for a company to have a small markup, around 10-20%, to initially attain sales and further determine how much demand there is for the product. A small markup also makes the product inexpensive for cost-conscious consumers.

There are a few types of discounts that are available for a company to use when selling liquid bleach in Zimbabwe. When the product is first introduced to the Zimbabwe market, a promotional discount can be offered. Customers could purchase the product for a pre-determined discount for a short period of time after the product is released. This will help with product awareness as well as sales of the product. Another discount that could be used is a quantity discount. A customer who wants to buy bleach in bulk should have that option and be able to purchase more liquid bleach for a discount per unit. Having these discount further attract consumers to purchase the product or to at least give the product a trial.

 

 

Compare & Contrast Your Product and the Competitors Product

Competitor #1: Colgate-Palmolive Company

  1. Ajax Oxygen Bleach Cleanser Heavy-Duty Formula
  2. Features: Non-chlorinated cleanser, use for places where the chlorine or ammonia odors are undesirable, 21 oz.
  3. Package: Oval-shaped, blue label with red letters, Aluminum cover.
  4. Price: $1.09 USD for one can
  5. Promotions: Print ad, internet ad’s
  6. Distribution Channels: Indirect Distribution, uses a chain of intermediaries

Competitor #2: S.C. Johnson & Son

  1. Fantastik Scrubbing Bubble All-Purpose Bleach Cleaner
  2. Features: works on indoor/outdoor surfaces, small spray package, degreaser, 32 oz.
  3. Package: spray, green package with white letters, “eliminates tough stains”, “5 in 1 cleaner”
  4. Price: $2.47 USD for one spray
  5. Promotions: print ad’s, internet ad’s, TV Ad’s
  6. Distribution Channels: Intensive Distribution; sell to as many outlets as possible so that consumers see the product everywhere they go

Our Company: The Proctor & Gamble Company, The Clorox Company

  1. Clorox Regular Bleach 121 oz. Jug
  2. Features: works on almost all surfaces and clothing, kills 99.9% of household germs, may be used as highly effective all purpose cleaner/disinfectant
  3. Package: plastic jug with a handle, blue and red label with white letters, instructions on the back,
  4. Price: $3.97 USD for one jug
  5. Promotions: TV, Print, Social Media, Internet, Radio
  6. Distribution Channel: Indirect Distribution, use of intermediaries to deliver product

Market Size

The estimated sales for the liquid bleach industry are approximately 2 billion dollars with forecast growth of approximately 1.8%. The growth is also estimated to grow by approximately 0.6% over the year 2019. There are estimated sales growths of approximately 1.5% in the industry considering the increased market size and revenue, which consequently results in increased sales (Clorox, 5). The estimated sales increase for the Clorox Company is approximately 1% for every quarter. The sales growth would differ in various segments. However, the sales growth would range between 1-3%. The Clorox Company is focused on growing their sales by about 3-5% annually, which requires strategies that ensure the sales volumes are achieved.

The Marketing Plan

Marketing Objectives

The Clorox company should target people that use more traditional options of cleaning but are still focused on having some chemical content included, thus also willing to pay a little bit more for some product deemed to be natural. The consumers in the high-income households should be targeted as compared to those in the lower income areas, since people in low-income areas do not have the available cash to make this type of purchase. The market targeted is one that is inhabited by young adults that are interested in multi-purpose cleaning products such as one offered by the company since the audience is mainly interested in convenience and simplicity (Iannuzzi, 198). In Zimbabwe, the company would have to be focused on making the sales increase by at least 0.5 for every quarter per year. The focus is having a growth increase of approximately 3% in every year. Therefore the major goal of the company is for the sales outlook in five years to reflect the continued expectation of approximately 3 points of incremental desired benefits from Clorox product innovation (Clorox 5). The company forecasts to have profit increase from 5.73 in the second year, which is estimated to increase in time to approximately 7.24 %( Iannuzzi, 203). The company also forecasts to have an increase in the profits annually thus rising by about $201 million. The profits would be attributed to factors such as 4% increase in the cleaning segment, 1% rise in lifestyle in the country and target areas as well 5% growth in the household (Newswire 3).

S.W.O.T. Analysis (of the Clorox Company)

Strengths

  • Strong corporate social responsibility.  The company has a strong product portfolio that would be appealing to the customers in the target market (Meidan et al, 484).
  • The company has a diverse workforce that would have great appeal internationally
  • The company has had a strong financial performance due to free cash flow.

 

Weaknesses

  • One of the weaknesses of the company is the limited geographic presence.
  • The company has a high dependency on the retailers
  • The company has the limited success outside the core business.

Opportunities

  • The expansion of its brands, which would be crucial when entering the new markets (Andrews & Shimp, 74).
  • Fuel growth by reducing waste is another opportunity for the company.
  • The free cash flow in the company is an opportunity when it comes to investing in adjacent product segments.

Threats

  • One of the threats of the Clorox Company in Zimbabwe is the intense competition from other firms, such as Colgate-Palmolive and S.C Johnson & Son.
  • The regulations set by the government affect the operations of the company, such as the indigenization law, which requires foreign companies to give up part of the ownership of the company.
  • The currency fluctuations and the volatile political climate tend to be a threat to the business operations of the Clorox Company in Zimbabwe.

Product Adaptation or Modification

One of the major components of the products created by the company is the chemical that would help in killing germs and bacteria. The bottle of the product would be stowed away in bathroom cabinets and kitchen. The significant components of the products serve various purposes such as a toilet bowl cleaner, glass and surface cleaner and also an all-purpose cleaner. The product would be packaged in a recyclable content where it would also be biodegradable and also 95% natural. The packaging component would also appeal to the customer since it would contain the writings about the importance and directions on how to use the product. Labeling must include multiple language, the most common being English, Shona, and Ndebele. Color considerations include having bright vibrant colors to match the culture of the target market. The product would be easy to use and also accessible in a variety of stores through an efficient support system. The product would be manufactured in the best way to ensure that it works on multiple surfaces.

Promotion Mix

The objectives of advertising would be to make sure that as many people as possible in the country know the company and thus selling the brand in the shortest time possible. Some of the media mix tools that would be used in advertising the products include social media channels, television, radio and also in magazines and newspapers, which are mostly used by the audience in the target markets (Andrews & Shimp, 82). The message would be delivered shortly and accurately with a focus on selling the brand through initiatives such as talking about the benefits and needs of using Clorox products. The cost would be affordable for the Clorox product such as $1.50 for the 59 oz. bottle.  Psychological pricing would also be used as a strategy. During the introduction, the costs would be low to attract customers. The major objective of the low-price sales is to gradually increase sales in the market as demand increases, with a focus on attaining profits. The first and loyal customers would be offered tickets that would be redeemed for financial discounts while purchasing the company’s products. The company would offer premiums while promoting sales through awards to the first customers and bonus prices thus inducing the customers to purchase the products (Fabian et al, 1105). The costs would be low and consider the income levels of the customers in the market to promote the sales. Local salesmen would be recruited by the company to meet face to face with customers, thus promoting the product through their specialist product knowledge and attitude. The other promotional programs to be adopted include customer appreciation events, customer referral incentive program, direct marketing and public relations.

Channels of Distribution

There are about 500 retailers that would be needed when starting a venture in the country before expansion. The department stores, supermarkets, and discount stores would be the main types of retail outlets considered. The company would give more margins to retailers at first, since the brand of the product is not well established in the market, thus enticing them to stock the product in the retails stores (Armstrong et al, 15). The method of operations would combine both credit and cash. The scale of operations would range from small to large, depending on how the audience in the target market decides to accept the product and purchase it. The commission merchants and agent, as well as brokers, would be considered as wholesale middlemen for the company. The product would be an alternative to common bleach and cleaning agents that are used but do not necessarily result in the desired benefits (Meidan et al, 482). Each type of wholesaler would be operated under the cash basis, considering that wholesalers are middlemen that are not stationary at one point. The scale of operations would be large since the company is focused on increasing the volume of sales through wholesale middlemen. The import or export agents would have to undergo scrutiny before accepted to work for the company since the focus is on achieving the set goals in the shortest period.

Resource Requirements

The finances would be raised through profits gained by the country as well as the cash flow from the head offices to support the venture in the new market in Zimbabwe. The company would recruit both international and local employees to help in carrying out its operations with a focus on experience and the quality that personnel would offer to the firm. There would be a focus on producing approximately 10,000 bottles of the product every day where the capacity would increase with time as the company fully establishes demand in the market of Zimbabwe.

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