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Business Plan - Assignment Example

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Introduction This report is a business proposal for Protrich Mushroom, one of leading mushroom producing companies in South India. Being one of the pioneers in mushroom production in the region, the company enjoys a good brand image in the region. The major markets of the company are the four south Indian states…
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Business Plan
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Download file to see previous pages The existing capacity of Protrich is not able to meet the demand for the products in its various markets. If the company is not able to expand the capacity for the existing demand and for the anticipated future demands, it will lose the market to other major competitors. Also, the Protrich need to expand as an international brand rather than confining itself to the south Indian and Middle East market. The potential markets for Protrich are China, Europe and USA. In order to compete in China, Europe and USA markets, Protrich will not only have to focus on the quality aspect but also on the cost aspect. For having an edge over the price, Protrich should adopt cost effective manufacturing. This is possible in India only up to a certain limit. Therefore, to have an even lower cost of production, it is better for Protrich to setup manufacturing unit in China. China, along with Netherlands accounts for more than 50% of the exports of white button mushrooms. China’s mushroom production has been in question for several times including certain countries imposing even anti-dumping measures on them. But this is mainly based on the fact that there wasn’t much notable technology being used for production process in the country. (Mushroombusiness, 2011) But Protrich being a company with all technological support for production, quality of production will never be in question. This report will analyze the benefits for Protrich to invest in China. Analysis Home Country The home country of the company is India. India as a mushroom market is not well flourished. There are very few established brands in the country. Even for the established brands, the market coverage will be limited. Retail customers are mainly from the upper middle class and above. Even for them, mushroom is not a frequent item on the dining table. But there is huge demand from hotels and restaurant chains. This is the customer group from which Mushroom companies have a steady demand. Dominos Pizza and US Pizza has been the customers of Protrich for six years and four years respectively. Apart from these established brands, there are also many other mediocre restaurant chains who are frequent customers of Protrich. Protrich’s major market is the southern states of India such as Kerala (the company’s home state), Karnataka, Tamil Nadu and Andhra Pradesh. Protrich’s products are available only in the major cities of these states. It is not distributed widely to include the smaller towns because there is very less demand in the smaller towns and cities. Even in the cities, the products will be available only in supermarkets. Protrich enjoys third position in terms of market share. The market leaders are Best Mushroom Limited and Mushroom India Limited. Protrich is almost at par with the market leaders in terms of the brand value. In the UAE market all the three brands are very popular. The advantage of current expansion move of Protrich is that it will be able to gain market share over the other two. Neither Best Mushroom nor Mushroom India has a market presence in Europe and USA. At this point, if Protrich is able to provide the market with quality products, it will be advantageous for the company in terms of brand value and market share. Host Country The potential host markets of Protrich are China, Europe and USA. Among these, foreign direct investment will be made by Protrich in China where it intends to setup the manufacturing units. The analysis will be based on the ...Download file to see next pagesRead More
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