Marketing Plan and Situation Analysis of Australia Honey Products - Case Study Example

Name) (Instructor) (Institution) (Course code) (Date) Situational Analysis Internal Environment The employees of Australia Honey Products are fully committed to their work. They are self-motivated. Minimum supervision is required. This is the driving force behind the company’s success in the industry. With the great innovation and development of talents in AHP, the company now has the best designers who have developed best packing and marketing skills enabling the company to thrive well in the market Political Trends Chinese government has been stable for a long time which making Shanghai suitable business environments (Forte, 2009, p.44). Any manufacturing processes carried out in these two cities have to comply with the environmental regulations. The government has set taxes which have to be adhered to. The political environment allows for fair competition without discrimination of foreign companies Economic and Financial Trends Economic trends in the country will have an impact on the business. Shanghai and Beijing have a large population with disposable income. China has a low inflation rate and a high GDP (BBC News, 2015). The country has set minimum wage which all businesses have to adhere to. The cost of housing has been rising in China hence the business will have to incur high costs of rent. Chinese currency has been stable hence and the country has been experiencing positive growth. Inflation is at around 1.5% in China and the country’s currency has appreciated which have lowered the cost of consumer goods (Zhao, 2013, pp.1006-1027) Socio-Cultural Trends With the advance of economy in China, people start to care more about their health. As earlier stated, the Chinese longevity health culture and focus on health problem is a great opportunity for the AHP to reap big in Shanghai (Sirieix, Kledal and Sulitang, 2011, pp. 670 - 678). AHP products like Cradle Mountain and Leatherwood Honey are pesticide free. As a result, the citizens of Shanghai will embrace these products and hence the penetration of the market. Furthermore, Shanghai residents will be using honey for different purposes Technological forces The businesses across the world is fast adopting the new trends. For businesses to thrive well in the current competitive world, there is need to adopt the advancement in technology (Chaudhuri, Dayal and Narasayya, 2011, pg. 88). AHP has adopted the latest technology in the processing of its honey to have a standard quality. Online customers will be monitored too. Their views will be considered to suit their needs and demands. All these is aimed at creating customer satisfaction. Customers will be offered with online sources of information which includes reviews and comments made by other customers. Use of IT in the industry will make it easy for the management make decisions easily Legal forces The Chinese government has set laws which have to be followed in the manufacturing industry. There are industry regulations which one has to follow. At the moment, health act, minimum wages and fair competition are main legal issues that are vital for operation of the Australia Honey Products SWOT Analysis Just like any other business across the globe, AHP faces typical and unique set of strengths and weaknesses regarding its operations in Shanghai. Strategic management and decisions can break or make AHP successful in Shanghai. This is because they can be threats or offer opportunities to Australian Honey Products. In addition, other external factors need to be put into considerations SWOT is an important tool used for analyzing effective marketing strategies in business. SWOT look considers Strengths, Weaknesses, Opportunities and Threats faced by the business entity. Strengths and weaknesses analyses the business internal environment while opportunities are external factors that influence the successes of a business (Keillor, 2012, pg. 171). The need for understanding both the internal and external business environments is for the company to make strategic decisions that will lead the business in achieving set goals and objectives. Strengths One of the strengths of Australian Honey Products is its new business model. It operates both warehouse and Online stores. This is able to serve various kinds of customers. A large number of new clients will be reached. The staff are dedicated to the company and grow with it. Some will be moved to Shanghai to train and mentor local in the new market. This will ensure that the brand image will be maintained in Shanghai. With good transport system in Shanghai, with over ten express postal companies, delivery of honey to new areas and to the online customers will both the business of Australia Honey Products Advanced facilities employed by the Australia Honey Products leads to the product of high quality honey meeting the international standards. This ensures the uniformity of the honey. The customers in Shanghai will enjoy unique and reliable taste of their preferred products. Advanced facilities will win the hearts of many customers. With reliable quality of honey, many loyal customers will be won and retained in the process. Weaknesses The harsh climatic conditions of Shanghai will be detrimental to the business in Shanghai. The high rate of pollution does not favour the production of high quality honey. It will also be expensive to transport raw material before processing in Shanghai. To deal with this challenge, Australia Honey Products will produce and process honey before exporting to China. This is relatively cheap and the honey quality will be maintained. Opportunities The most obvious business opportunity in generally in China is its huge population. Its population is over 1.3 billion. The target market is Shanghai. It has a population of 24.15million (Worldpopulationreview.com, 2016). This is a huge customer base to launch any product in the market or for expansion into new markets. Shanghai is one of the most urbanization cities in China. Due to its advantageous geographical location, Shanghai has become a large and prosperous port city. Many of foreign brands start to hit the Chinese market from here. People who live in Shanghai are also more used to facing new products, cultures and concepts, as well as they, like to follow the world fashion trend; they pursue the better lifestyle and proud of being the leader city in China. Due to the high consumption ability of shanghai citizens, they start to have more requirement about the goods; the most important consideration is not the price, instead of are the quality and fashion. This is a perfect opportunity for the AHP to sell its honey. It is also important to note that there is an increase in the income not only among the target market of Shanghai, but to China as a whole. According to statistics, the income level has increased from 3566RMB in 2010, to 5036RMB in 2015. This translates to a growth in the number of middle class citizens. The middle class in the driver of economy in any country. This group of people are first to embrace new products and services in the market. The Chinese longevity health culture and focus on health problem is a great opportunity for the AHP to reap big in Shanghai. AHP products like Cradle Mountain and Leatherwood Honey are pesticide free. As a result, the citizens of Shanghai will embrace these products and hence the penetration of the market. The demand for honey in Shanghai has been increasing in the recent years. Australia and New Zealand are the two regions which have been exporting honey to China (Wei, Huang, and Yang, 2012, pp. 683-693). The Free Trade Agreement between Australia is a good opportunity for the sale of honey in Shanghai. The Free Trade Agreement promotes the production of environmentally friendly products. The pesticide-free honey is going to push the honey to great heights. Shanghai is a highly developed economy with a GDP of 2.35 trillion making it the most developed region in China (Tn.gov, 2016). With this kind of economy compounded with high demand that exceeds the supply, AHP will not face a lot of challenges when venturing into this market. The market is very ready for AHP honey products Leatherwood is highly sought after, but hard for Chinese customers to obtain. AHP entry to the Shanghai market will be a massive for the business Threats Every business entity is normally faced by various kinds of threats. These are the challenges that falls beyond the scope of the business. The external environment that pose a big challenge to Australia Honey Products include CITADELLE, the global largest supplier of maple syrup, offer multi-sizes. This an alternative product to the honey sold by AHP. Some of the substitutes include Stevia products, Coconut Nectar, and Maple Syrup. To counter this challenge, Australia Honey Products will be selling natural honey to the Chinese who are more concerned with the health related issues. The target market prefer natural products as opposed to processed alternatives. The company will do through marketing and educate the target market about their products in the market. This will the sales in the market New Zealand is the largest competitor and some domestic competitors. To deal with this challenge, Australia Honey products will carry out marketing and promotions to ensure it penetrates the market. References BBC News. (2015). Chinese inflation eases by more than expected - BBC News. [online] Available at: http://www.bbc.com/news/business-34525432 [Accessed 9 Oct. 2016]. Chaudhuri, S., Dayal, U. and Narasayya, V. (2011). An overview of business intelligence technology.Communications of the ACM, 54(8), p.88. Forte, F. (2009). Cooperatives’ Tax Regimes, Political Orientation of Governments and Rent Seeking.Journal of Politics and Law, 2(4), p.44. Keillor, B. (2012). Winning in the global market. Santa Barbara, Calif.: Praeger, p.171. Sirieix, L., Kledal, P. and Sulitang, T. (2011). Organic food consumers' trade-offs between local or imported, conventional or organic products: a qualitative study in Shanghai. International Journal of Consumer Studies, 35(6), pp.670-678. Tn.gov. (2016). Governor Haslam, Commissioner Boyd Meet With Shanghai Mayor, Co-host Tennessee Investment Seminar - TN.Gov. [online] Available at: https://www.tn.gov/ecd/news/41122 [Accessed 9 Oct. 2016]. Wei, G., Huang, J. and Yang, J. (2012). Honey Safety Standards and Its Impacts on China's Honey Export. Journal of Integrative Agriculture, 11(4), pp.684-693. Worldpopulationreview.com. (2016). Shanghai Population 2016 - World Population Review. [online] Available at: http://worldpopulationreview.com/world-cities/shanghai-population/ [Accessed 9 Oct. 2016]. Zhao, S. (2013). Information Exchange, Headquarters Economy and Financial Centers Development: Shanghai, Beijing and Hong Kong. Journal of Contemporary China, 22(84), pp.1006-1027. Read More