Jacobs Creek in United Kingdom - Essay Example

Jacobs Creek in United Kingdom This paper is about the wine producing firm, Jacobs Creek, which is planning to expand its business operations to themarket of United Kingdom. This paper will discuss the strengths and weaknesses of the company, the business environment in the UK and the distribution situation.Strengths and Weaknesses The wine producing firm has a rich heritage as the founder of the company planted the first vineyard on the banks of Jacob’s Creek in 18471. Only the premium varieties of vineyards are selected from Australia to make these special wines.

The company has been supplying to 60 countries of the world for over a decade. Since 1973, the company has accumulated around 5000 awards that include 110 trophies and 670 gold medals2. Jacob Creek is one the Australia’s most famous wine distributor. The company has continued to innovate in a variety of ways. It recently introduced screw caps instead of the corks on its Riesling variety. The quality price ratio of the products from Jacob’s Creek is excellent as the basic wines cost just £4.6. The only major weakness that Jacob’s Creek reflects is that it is not an elitist brand and it has no snob value3.

The brand is approachable by everybody because of its lower cost as compared to other leading premium wine producers. A person having a bottle of Jacob’s Creek is considered no outclass in contrast to a person holding a bottle of Absolut in his hand.Overseas Environment (UK) The wine market of UK is one of the worlds largest and the most dynamic market for imported wines. Wine share of all the alcoholic beverages in the UK accounts for 30%. The market is valued to £7 to £9 billion by the Wine Intelligence4.

There are 45 million adults in the UK of which 31 million are wine drinkers, therefore all the statistics are in favor of Jacob’s Creek brand. The population structure is changing rapidly in the UK as more and more people cross the 65 years mark; the younger population group is falling day by day. The average life expectancy in the UK has increased to 82 from 78.55 which means that the wine consumers are on the rise. This is evident from the survey by Wine Intelligence Ltd that most of the wine consumers are above the age of 65.

Distribution Situation The distribution cost is less in the UK as compared to Australia but it is a difficult task. UK is bigger is size than Australia in terms of developed areas. Wine consumers are spread from the downtowns to suburbs in the UK which requires wine companies to develop a strong distribution system in order to maintain presence everywhere in the country. The warehouse costs are much higher in the UK which may drive up the cost of wine bottle. The wages of drivers are also higher than Australia.

References1. Jacob’s Creek. “Heritage Collection.” Jacob’s Creek, http://www.jacobscreek.com/main.php?country=Australia#/Launch-Heritage/2. Jacob’s Creek. “Awards.” Jacob’s Creek, http://www.jacobscreek.com/main.php?country=Australia#/Our-Wine/Awards/3. Lulie, H. “The 2015 Wine Consumer Behavior Model.” Wine Intelligence Ltd, http://www.wineintelligence.com/pdfs/2015_Wine_Consumer.pdf4. Kapferer, J. The New Strategic Brand Management: Creating and Sustaining Brand Equity. 4th Edition.

USA: Kogan Page, 2008.5. Department of Health. “Health Inequalities.” NHS, http://www.dh.gov.uk/en/Publichealth/Healthinequalities/DH_064026