How an Ice Company Participates in Cold Chains in Developing Countries - Coursework Example

How an Ice Company Participates in Cold Chains in Developing Countries The crises faced by developing countries suchas the Ebola outbreak and food shortages call for the use of ice products in finding the solutions. In response to the increasing instances of outbreaks in areas such as the streets of Monrovia and Freetown, there are questions as to how the countries may dispose off the bodies. A similar condition is the response of the World Food Program to food management attempts to curb the food shortages (WHO 4). For both the cases, there is a common challenge of storage and transportation of the resources. For instance, the Ebola case faces the problem of insufficiency of cooling facilities for vaccines, which could present a viable solution. Vaccines require refrigeration during the periods of transporting in the hot tropical climates of the developing nations, mostly African. There is the necessity to use ice in preservation of corpses until there is time for disposal. Much of the current problem relates to the fact that there is insufficiency of ice in some parts of the affected countries (Kitinoja 2). There have been reports of farmers losing substantial amounts of their produce at the times of harvesting and subsequent effects of food insecurity. Various reasons as those mentioned in the crises call for the establishment of cold chains in developing countries. Before establishing a firm in the affected regions, there are considerations concerning the procedures required. The paper explains such diverse considerations that a business venture should consider. Further, it describes the processes of marketing and pricing strategies as well as necessary contacts needed for the investors. Investment Preparations for the Ice Manufacturers Pride defines product differentiation as the creation and designing of products to give them innovative characteristics or features (316). The firm needs to have product differentiation strategies so that customers may find it as the best among its competitors. In implementing product differentiation, the company should consider producing products that have a different look from competitors. A possible way of attaining such is through embracing diversity. Embracing diversity is important to make the business venture into producing more products rather than focusing on a single line in the market. The cold chain industry involves a number of sub-sectors, such as food management, medicinal vaccines, use in the hospitals, for the preservation of corpses and other related sectors. The firm should target the marginalized areas in terms of consumable grade ice products such as ice pure ice and drinking water. Diversity will enable the company venture into supporting hospitals by proving them means through which the doctors can preserve medicines and vaccines. For instance, the current state of Ebola outbreak in the West African region, the cold services may help to keep vaccines (WHO 5). The citizens of the countries will have a notion that the company cares for them, which will boost their trust in the firm’s products. Concerning the preservation of medical products, which require refrigeration, the company should adhere to the regulations of the World Health Organization. The organization dictates that such products that require intense care be protected through special equipment. The manufacturers must have the guidelines of good manufacturing practice in their production, storage, and transportation and of vital medical facilities. Unsuitable handling and storage practices of temperature-sensitive products can cause probable spoilage and consequent financial impact for the medical service. For example, insulin, semen, and products of biotechnology need storage in ice-facilitated low temperatures and are expensive commodities. Rogerson emphasizes the necessity to embrace mentorship for a start-up business (124). The company management should have a team to orient it to the business environment. The cooperation may also venture in food management practices. For example, the firm may help citizens to preserve some foods such as fish, fruits, vegetables, meat, and cheese among other products. In developing countries, there are reversed trends of preservation. Some foods, which require less refrigeration, end up in the icy conditions at the expense those required. It is typical, example, to find beverages in refrigerated conditions while fruits and vegetables remain in ambient temperatures. If the company ventures in provision refrigeration of products activities, the people will become a preferred supplier because of the feeling of trust and care that will exist. The Pricing Strategy All the diversification and product differentiation practices will target to fill the market gap in the cold chains industry. Marginalization of production and consumption of such services result from the fact that some people in developing countries consider cold chain services as unaffordable luxuries. The company, consequently, should find the best marketing strategies for cost-effective delivery. It should apply the marketing concept. According to Hamper, the marketing concept refers to a management concept that states that the central role of a company involves discovery of various target markets (6). The company should have relevant information about economic status of the prospective customers. There should be considerations for the lowest production costs, which will enable the firm to sell the products to customers at low prices, in comparison to other competing companies in the market or industry. Most customers in developing nations, particularly from average income earners population, do not have a tendency of buying food and other related products from retail stores such as supermarkets. It implies that the firm should consider selling the products in the open markets, where they will sell quickly and have an expansive market. The focus strategy will help promote collaboration to influence the pricing and the profitability of the operations. The business may attain market leadership because using the approach affects the segment of the market, which the firm may find the least competition. The market strategy focus entails lowering the costs of producing, after an analysis of the resources that the company holds. The cost of the production process has a direct influence on the prices at which the customers buy the products. The costs of operating business in the developing countries are the most challenging for the businesspersons. Quality is another factor considered in the focus strategy because it influences the preference of consumers for some products in the hike of many differentiated products. The ice firm needs to give the highest quality products to the customers as a way of luring them into preferring its products. The consumers will attach quality to the prices, and find the company’s products the best in the market. The ice firm also needs to develop a strong branding strategy. The brand is an essential tool through which the company will give an impact on consumers. Focus strategy for the brands entails promotional undertakings that will enable the customers to know of the existence of the products in the market. The factors described within have an influence on the marketing strategies for a starting company for the foreign markets. New Networks and Contacts Needed By the Company Operating in foreign nations gives challenges to the companies because of the various procedures that the governments consider necessary. The first factor of consideration is licensing and registration documents. The grant will give the business a go forward to start production of the goods and services of intention. The business venture will become a lawful organization because the investors will have a chance of knowing the restrictions and the provisions of the registration and licensing agreements. The firm also needs to form links with the related parties in the industry, such as the departments of employment and the supply chains. The department of employment will give the guidelines for the hiring of workers at to facilitate production. There should also be clarity on the supply chain for the factors of production for the cold chain industry. Some of the factors may include electricity, water, additives, and others, without which the production process will stagnant. The company should consider establishing strong diplomatic ties with the intended country of operation. Such a factor will enable the company to learn about political and economic atmosphere and negotiate the terms of the contract offered. The management company will also have a chance of learning of the culture of the nation of interest, which determines their demand patterns and help to avoid wastage. Further, culture is a key factor that influences management strategies of the global workforce (Caligiuri, Lepak and Bonache 76). It is necessary that the business determine the legal procures involving the production processes for consumable goods. Such procedures may include the quality standards that the host nations may have. Another concern for the legal processes is the consumer protection mechanisms and the penalties attached to them in case of digressions. Foreign Currency Accounting Expertise Businesses intending to start operation in foreign countries should consider studying the monetary system of the countries of interest. The structures of the financial system entail the exchange rate regimes, both the current and the past. Another fundamental factor of consideration is the currency blocks, which determines the number of the countries with which the countries of interest can operate. The exchange rate systems have a bearing on the costs of imports and exports for the ice products (Levi 76). The firm may obtain a quick access to the accounting systems of a country of interest by researching from existence databases such as the IMF and the World Bank. Another possible source of information is a linkage with the country’s monetary system and the related financial institutions. Such institutions as the central banks may give the relevant advice to the investors, which will make the work of researching an easier task. The International Financial Reporting Standards provides an insight of all the necessary accounting procedures, most of the countries worldwide have in practice. There are also the Acceptable principle of accounting, which makes the process of obtaining accounting information a simplified undertaking because of similarities. The Departments, Which Will Support International Sales and the Structure of the International Trade Dealing with international trading requires that the company undertake to develop a strategy for exporting procedures. There are varied methods of shipping, such as direct and indirect selling. For the indirect selling export practices, the company uses export intermediaries such as Export Trading Company or Export Management Company. The intermediaries involved in the chain of distributing the products search for overseas markets for their clients. On the contrary, the direct selling export method requires the producer themselves selling to the buyers on an international front. The choice of the best method relies on factors such as the product nature, the company size, the previous experiences related to the trade, and the conditions of the businesses in the overseas markets. There is a choice of the exporting approaches that the ice company may use in the process of exporting its products. The first one involves the use of passively filled orders that the domestic buyers may use to buy the goods and then re-sell them. The buyers are the ones who may determine the quality of the products against the international standards. If the products satisfy the international export standards, then they export them and if otherwise, they sell domestically. The firm may identify domestic buyers who represent the foreign markets. The local consumers then buy the goods and at the re-sell them internationally, though the producers of the same products do not meet the risks involved in the process. If the corporation chooses to use the intermediaries in the process, then it will still control the process and enjoy the market performance. The last choice is the direct selling approach, which involves the highest risks because the exporter is in direct control of both the market and the export procedures. Conclusion Ice is an essential substance for preservation of medical products and food. The use of ice will help the developing nations to solve some of the afflicting problems such as food shortage as well as storage of vaccines. Realization of the dream in the developing countries will only come if there are efforts to make the access to ice simple. It as a result, calls for an establishment of ice firms in the same countries. The process of establishing the businesses requires a fiscal analysis in relation to the business environment of the country of aspiration. The investors need to work against the cultures of the people in the developing states and educate them on the need for such facilities so that they can establish a strong market base. The analysis will also determine the interplay between the state of politics and the influence on the economic performance. After the firms have found the best investment opportunities, they will then proceed to start producing the ice products. The pricing strategies of such firms should consider the prevailing economic status of the population. It means the companies should emphasize on cost-effective production method. Works Cited Caligiuri, Paula., Lepak, David and Bonache, Jaime. Managing the Global Workforce. New York, NY: John Wiley & Sons, 2010. Print. Hamper, Robert. The Ultimate Guide to Strategic Marketing: Real World Methods for Developing Successful, Long-Term Marketing Plans. New York, NY: McGraw Hill Professional, 2014. Print. Kitinoja, Lisa. Exploring the Potential for Cold Chain Development in Emerging and Rapidly Industrializing Economies through Liquid Air Refrigeration Technologies. Liquid Air Energy Network. Postharvest Education Foundation, Jun 30, 2014. web. Jan 27, 2015. . Levi, Maurice. International Finance. 4th ed. London: Routledge, 2005. Print. Pride, William. Marketing. Australia: South Western Cengage Learning, 2010. Print. Rogerson, Andrew. Successfully Start Your Business: Expert Advice from a Business Broker. Sacramento, CA: Rogerson Business Services, 2009. Print. World Health Organization (WHO). Stimulating Innovation in the Vaccine Cold Chain Equipment Industry. Who.int. World Health Organization. Web. 27 Jan. 2015. Read More