SWOT Analysis for Sump Coffee - Example

SWOT Analysis 4.1 Strengths: 4.1.1 High Quality Just like other coffee types being sold in Sump Coffee, USA, Altura Coffee will be ready to offer a distinctive number of blended coffees that basically within the single origin and estate coffee varieties. The coffeehouse is able to integrate its coffees with a significant number of premium loose leaf teas as well as pyramid teas as well. In essence, Sump Coffee, in the US, will maintain its immediate high quality coffee production status given that it only be offering AA Grade Arabica coffee beans, which are grown in unique temperatures and without the use of any form of pesticides. These beans further maintain their quality level given that they are allowed maturity for a period exceeding two years in order to maximise their level of sweetness and deliver the very perfect experience in coffee consumption. 4.1. 2. Wide Variety of Products Presently, Sump Coffee is enjoying a distinctive number of coffee varieties that are served to its already loyal customer-base. These varieties are mainly exotic and include; Ethiopia, Reko and Kenya, Gachatha, which means that the business can still include the Altura coffee in its menu and still, attract substantial level of customers hence profits. 4.1.3. Quality of Service is high Being a local and small coffee business, it means that Sump Coffee is keen to satisfy its current customer base. The business offers a wide array of platforms for which customers can seek clarifications and provide feedback that regards to service improvements. This feature has a potential of attracting a great number of more customers for its existing product portfolio as well as the ones underway; Altura coffee. 4.2 Weakness 4.2.1 Small Company Sump Coffee is still a small coffee company that operates within Saint Louis, United States of America. Due to its limited operational space, there is a likelihood that the introduction of the Altura product would not result to expected outcomes; sustainable sales. The business is also likely to face challenges attributed to a relatively lower number of personnel that would otherwise be needed for such important activities as sales and marketing of the new product into the existing market. 4.2.2 Readily- Alternative Substitute Products The introduction of the Altura coffee product is likely to face a challenge of not enjoying relative customer support and loyalty because Sump Coffee already has an alternative to this high grade coffee called AA Kenya, Gachatha coffee. The introduction might not make any significant difference given that the existing customers are already enjoying the top notch brand. 4.2.3 The Price For this Product might not attract Substantial Customers The current brands being sold are quite affordable mainly because they are supplied directly from the growers of coffee is different parts of the globe. Thus, because supply of the Altura coffee brand will be supplied by a middle-man being the Altura Company then the prices to be charged to consumers might not be affordable enough for different classes. This will likely result to lower sales and thus, revenues needed for meeting overall expenses of offering the product to the market. 4.3 Opportunities 4.3.1 Strong Coffee Culture in The US In the United States of America, the coffee culture has continued to favour emergence of specialty coffee stores. Therefore, the introduction of Altura brand will not only increase but also complement the existing product portfolio without compromising on quality. Given that there is a huge number of Americans that embrace coffee as a part of socialisation, the introduction of Altura will attract potential coffee enthusiasts who are always in search of newer products in the coffee market. 4.3. 2 Media Interest In partnership with the media, the Specialty Coffee Association of America organises an annual competition for stores that prepare coffee drinks through their Baristas. These baristas emanate from different areas of the country to make a drink of the own invention before judges. The event is likely to enhance Sump Coffee’s efforts of launching the Altura coffee and as a result attractive sustainable number of consumers. 4.3.3 Potential For Expansion The venture is still small but has a higher chance for growth and development especially because of the current US economic growth. The company is able to seek long term growth strategies that will enhance coffee consumption in different states of the country. 4.4 Threats 4.4.1 Exchange Rates The current appreciation of the US dollar against major world currencies include the Australian dollar is likely to affect the way trading will be conducted especially in regards to export of the Altura coffee, which will be received at a higher margin cost that will likely increase consumer prices. 4.4.2 Competition The threat of competition is real especially from other sections of the world that still produce quality coffee at affordable costs. Such high grade coffee as Ethiopia and Kenya, will likely result to high competition to the Altura brand. 4.4.3 Legal Requirements & Challenges The two countries operate under different legal requirements hence a likelihood of slowing the trading process due to complex logistics in the United States of America as compared to Australian market. 7.0 Marketing Mix Strategies 7.1 Product 7.1.1 Brand Image Repositioning Strategy This would involve the numerous efforts that Sump Coffee will engage in for purposes of position the Altura coffee in the immediate minds of the new US potential customers. This can be achieved through identifying the target customer who in this case can be the middle-income coffee enthusiasts. US-based customers can also be made to believe in the brand by ensuring that the product is packaged in a distinctive and unique manner (Sinapuelas, Hui-Ming, and Bohlmann 2015, 560). 7.1.2 Line Extension Strategy This will involve Sump Coffee using such an established coffee brand as AAA Kenya Grade, Gachatha product to lunch the Altura coffee. The only difference can be seen in terms of new flavours and packaging of the coffee beans. 7.1.3 Global Product Standardisation Altura Coffee can use this marketing strategy to enter into the Sump Coffee US international market. The availability of an online platform for Sump Coffee will help to promote the product across the different cultures and sections of the United States. The management of the coffee firm might choose to modify the new product based on the existing products and services that are already deemed to be universally prevalent. 7.2 Pricing 7.2.1 Introductory Pricing Strategy This is a strategy that Altura coffee will embark on in order to enter the United States of America specialty coffee market. A penetration pricing strategy would entail setting low prices for the purpose of entering this rather newer market (Sinapuelas, Hui-Ming, and Bohlmann 2015, 567). It means that Sumo Coffee will receive coffee from Altura at relatively small costs in order to position its prices below the current ones being charged for other coffee brands. This might even mean succumbing to possible losses for a certain period of time before readjusting it to a reasonable price. On the contrary, the company can still choose to set a high initial price for the Altura coffee. The notion here will be to go after the consumers that will be willing and able to pay for a high price as a way of recouping its investments within the economy at a much faster pace (Sinapuelas, Hui-Ming, and Bohlmann 2015, 570). 7.2.2 Global Pricing Strategy There are three ways of employing global pricing strategies that include; extension, adaptation and invention that Sump Coffee can adopt to effects pricing policies for Altura coffee. Under the extension global pricing model, the company will have to charge a similar price that is charged in Australia taking into consideration the fluctuating foreign exchange (Ataman, Harald and Carl, Mela 2010, 870). Under the adaptation model, different prices are charged in different markets meaning that Altura coffee will be charged differently in both the US and Australia. The only control mechanism that will be embraced in this model rests with the setting of transfer prices within the entire coffee company. The strategy is likely to prevent issues that emanates from the disparities that arises from different local market (Ataman, Harald and Carl, Mela 2010, 870-871). Under the innovation global pricing model, the coffee company will ensure to take consideration of the unique market facets like aspects related to costs, competition and different income levels as well as the US local marketing strategy. 7.2.3 Competition Based Pricing Strategy Under this strategy, Sump Coffee will be compelled to compare the prices charged for competitive coffee products despite of the costs incurred while preparing and packaging the newly launched Altura coffee in the US market. Sump Coffee being in the new market should engage in different analysis phases that include; the relative estimation of demand schedules for the product, choosing the price level that provides a higher contribution margin as well as notable approximation of aspects related to incremental and overall manufacturing and marketing costs as an imminent way of attaining prospective sales volume (Dovleac 2014, 39-41). 7.3 Distribution 7.3.1 Importing Strategy An importing strategy can be one of the most effective ways of growing one’s own business and, also cut down on the level of manufacturing costs. Altura Coffee can use this strategy to ensure that they avail a great number of imported, affordable and quality coffee products. 7.3.1 Exclusive Distribution Strategy The strategy involves a single retailer, which for this case happens to be Sump Coffee, who is sought for the product in a certain geographical platform. Sump Coffee should be known within the larger Saint Louis location to be the only store distributing Altura coffee. The strategy can be used to formulate a common form of distribution in relation to coffee products that aims to seek a high and prestigious brand image (Ataman, Harald and Carl, Mela 2010, 871). 7.4 Promotion 7.4.1 Media Advertising Strategy This strategy will involve Sump Coffee going to the various media houses like TV and Radio stations to seek promotion of the coffee product. It will entail intensive TV and Radio advertisements that would be directed towards certain marketing niche especially ones that can easily afford the premium coffee. Advertisements will be conducted during hours that majority of these targeted market customers listen to their programs (Chao, Canan and Tiger 2012, 15-17). 7.4.2 Social Media Strategy Social media strategy entails advertising the coffee product using the numerous social platforms available for the company that include; Facebook and Twitter (Harlow 2015, 154). Through these platforms, the company opts to conduct different promotions that would help attract and inform new customer base. 7.4.3 Endorsement Marketing Strategy This is a promotion strategy that the Sump Coffee can use to lure certain targeted customers into consuming the product. The most viable endorsement strategy involves the celebrity endorsement (Mishra 2015, 22-24). For instance, the current Aeropress competition and ice cream that has used such celebrities as Brad Pitt could be used to promote the Altura brand to the new US consumer market. References List Ataman, M. Berk, Harald J Van Heerde, and Carl F Mela. 2010. "The Long-Term Effect of Marketing Strategy on Brand Sales." Journal of Marketing Research (JMR) 47, no. 5: 866-882. Chao, Chiang-nan, Canan Corus, and Tiger Li. 2012. "Balancing Traditional Media and Online Advertising Strategy." International Journal of Business, Marketing, & Decision Science 5, no. 2: 12-24 Dovleac, Lavinia. 2014. "Pricing Policy and Strategies for Consumer High-Tech Products." Bulletin of the Transilvania University of Brasov. Series V: Economic Sciences 7, no. 1: 37-42 Harlow, Harold. 2015. "Strategies for Social Media: Linking Vision, Mission and Goals with Metrics." Proceedings of the European Conference on Intellectual Capital 150-156 Mishra, Aditya S. 2015. "Brand-Celebrity Match and Its Impact on Advertising Effectiveness." DLSU Business & Economics Review 25, no. 1: 16-27. Sinapuelas, Ian, Hui-Ming Wang, and Jonathan Bohlmann. 2015. "The interplay of innovation, brand, and marketing mix variables in line extensions." Journal of the Academy Of Marketing Science 43, no. 5: 558-573. Read More