Comparison of New Zealand and Singapore Marketing - Case Study Example

Running header: International marketing Student’s name: Instructor’s name: Subject code: Date of submission Comparison of New Zealand and Singapore a) Business environment- the 2015 ease of doing business report by World Bank ranks Singapore as the easiest place to do business globally while New Zealand comes second. Indeed, registering a company involves just two steps that are completed within 24 hours online. Singapore also fares better than New Zealand in terms of taxes and cross border trade which would matter to the company. Singapore is also placed ahead of New Zealand as far as trade freedom and technology are concerned. b) Taxation – Singapore is rated the 4th easiest place globally in paying taxes with New Zealand ranking 26th. The tax burden in Singapore is also lower with corporate tax rate at 17% and GST being 7% compared to New Zealand’s 30% and 15% respectively (Lew, 2009). c) IP protection – while Singapore is ranked second in IP protection, New Zealand ranks sixth globally. d) Global competitiveness – based on the above factors Singapore is ranked the second most competitive economy globally. However, New Zealand’s competitiveness is hindered by inadequate supply of infrastructure, limited access to financing, high rates of tax restrictive labor practices, bureaucracy in business as well as level of political stability which makes it the 17th most competitive economy globally. Based on the factors analyzed above, Dairy Farmers would prefer to venture in the Singapore market mainly because it is far much easier to do business in Singapore than in New Zealand. Furthermore, the tax savings in Singapore will mean that the company can expect to make more after tax profit in Singapore than in New Zealand. PEST analysis of the Singapore market and its comparison with Australia Political and legal environment a) Just like in Australia, Singapore is an investor friendly country with the government setting up numerous organizations to help business and investors grow. b) The government through the ministry of trade and industry promotes investment and innovation. The ministry has the task of anticipating problems while identifying opportunities for growth while coming up with policies to support enterprise (Stephan, 2011). c) A number of regulatory statutes exist under the ministry of finance including the companies act, business regulation act, currency and accountants act all aimed at making Singapore a world class financial and business hub through building conducive business environment for business and investors. d) Through government E-Business portal, Singapore has been able to promote transparency where government supplies and procurement are done online. e) Singapore is characterized with efficient enforcement with low levels of corruption even lower than in Australia. The government has also set up corruption practices investigations bureau to limit and deal with corrupt practices. This serves to improve the business environment and hence the country’s competitiveness. f) Business licensing is relatively easy though the government puts in place specific measures aimed at protecting local retail industry. Economic factors Singapore has been described as a vibrant free market economy developing at a rapid pace. The country has the highest per-capita income in ASEAN. The government supports the economy through providing corruption free environment with educated and motivated workforce (Ken, 2015). In addition, there is a well-established legal and financial business framework. With the recent efforts by the government to diversify the economy, Dairy Farmers can expect to find a good environment for its operations. The country has high rates of economic growth with unemployment rates being very low at 2.3% with the service industry forming the bulk part of the economy at 67% while manufacturing contributes 19.4% of the economy. In addition, the country has been characterized by stable exchange rates with the country’s monetary and fiscal policy being relatively stable. As stated above, the taxation rates in Singapore are extremely low compared to those of Australia. Social cultural factors a) Singapore is a country that still follows the traditional family values though the younger generation has adopted western culture and values. This is similar to Australian culture which is largely westernized. b) Singapore society values mainly involve a mindset of Kia-su implying to afraid of losing out to others (Sween, 2011). Singaporeans work hard hence increasing their disposable incomes and hence ability to spend. c) The country has about 4.8 million people with majority being of Chinese origin. Singaporeans dislike blue collar jobs and hence such labor is mainly imported from neighboring countries. Technology Singapore is highly advanced technologically. The country has a comprehensive infrastructural set up that acts to attract foreign investments. The country is highly advanced in IT with household internet broadband penetration rate reaching over 70% (Euromonitor.com, 2015). The government has also embraced technology in governance with this easing the application processes and company registration durations as discussed above. Conclusion Based on the above analysis, it is clear that Singapore’s business environment is more or less similar to that of Australia. In fact, Singapore is better than Australia in a number of fronts including ease of business registration, providing a free trade environment that is corruption free as well as the low rates of tax. However, Australia can be regarded as better in terms of availability of labor is concerned. However, since the country is able to import labor from neighboring countries, this should not deter Dairy Farmers from venturing into Singapore. As such, it seems that the company will benefit a lot by having operations in Singapore especially as far as the cost of doing business as well as the tax savings are concerned (Johansen, 2001). However, the fact that Singaporeans are always afraid of losing to others will mean that our marketing strategy will have to be tailored in such a way that it presents our products as Singapore made so that they can own the brand. In this regard, much of our budget for the Singapore operation will go towards advertising most of which will be done online owing to the high level of development in internet and IT in the country. Overview of Cheese market in Singapore The Singapore cheese market has been experiencing a 4% annual growth since the year 2010. The natural cheese segment leads the cheese market in Singapore with a 58.3%. However, there are other small segments which control the rest of the market. The market is still expected to record a 4% growth in the year 2015 and has an estimated value of $59 million currently. The main customers for the cheese industry include the international hotels and restaurants that continue to enter the country aggressively on a yearly basis (ITA, 2015). The market is considered to be in its growth phase as more and more Singaporeans continue being exposed to western and Italian Cuisine while the number of expatriates is increasing and hence raising demand for various types of cheese. Competitive landscape Dairy Famers main competitor in Singapore will be Kraft foods limited which is the top cheese dealing company with a market share of 40%. However, as more cheese players continue to enter the market, Kraft Foods market share is expected to decline. The market is supplied from both domestic and foreign sources with the main foreign sources being Italy and Netherlands, New Zealand and Australia. Cheese in Singapore is mainly distributed directly from the companies to the hotels and restaurants who buy directly from the company (Jabez, 2013). Major wholesalers and supermarkets also buy directly from the companies for distribution to retailers and consumers. As stated above, there is a lot of competition in the market with the major competition coming from Kraft foods with its two major brands namely Kraft Singles and Philadelphia though there are smaller companies who also intensify the competition in the market. Majority of the competitors are locally based though there are some who are foreign based. Differentiation and positioning strategy We are certain to overcome the competition in the Singapore market to have a significant market share in the market owing to our differentiation and positioning strategy. We intend to position our products as being of high quality with superior nutritive value with superior flavor’s and tastes while offering our products at relatively lower prices compared to our customers. We will adopt an aggressive marketing campaign that will eventually position our cheese as the best in the market (Lisa, 2015). This is based on our company’s strength of many years of experience in manufacturing high quality cheese with the best flavors in the market with the latest technology which our competitors lack. Buyer analysis As stated above, the main buyers of cheese include international hotels and restaurants as well as major supermarkets. There is also an emerging segment of expatriates who are westernized and have become major consumers of various cheese brands. In terms of consumer behavior, the market can generally be divided in to two major groups of the old and the young. The old are generally conservative and may not offer a major market for the company as they are not serious consumers. On the other hand, the young, the expatriates and the tourists are generally westernized and hence are ford of cheese. They are the serious consumers of cheese in Singapore and this is the target market that Dairy Farmers should focus on in Singapore. Market segmentation strategy We will use both behavioral and demographic segmentation strategies in marketing our Cheese in Singapore. Regarding behavioral segmentation strategy, we will mainly target the tourists and the expatriates who tend to be westernized and hence can provide a large consumer group for our market hence offering us a big market. In this regard, our cheese will mainly be marketed in major tourists’ destinations and where expatriates work including hotels and restaurants. Demographically, we will segment the market based on the ages of potential customers (Philip, 2010). As stated above, the old in Singapore are generally conservative and hence may not provide a big market for us. On the other hand, the young are more westernized and hence they are expected to offer a big market for Farmers. In this regard therefore, we will manly target people aged between 18 and 40 years since they comprise mainly the students and the working class who may have a lot to spend including buying our cheese products. References: Lew, Y2009, PEST Singapore business environment, Retrieved on 1st October 2015, from; http://www.slideshare.net/karthiknat/21331604-pestsingapore Stephan, S2011, Marketing planning: Where strategy meets action, London, Prentice Hall. Ken, C2015, E-Government in Singapore- A Swot and Pest Analysis, Retrieved on 1st October 2015, from; http://www.dlsu.edu.ph/research/journals/apssr/pdf/200612/science_4.pdf Sween, H2011, International marketing, New York, John Wiley & Sons. Euromonitor.com, 2015, Cheese in Singapore, Retrieved on 1st October 2015, from; http://www.euromonitor.com/cheese-in-singapore/report Johansen, B2001, International marketing strategy, London, Rutledge. ITA, 2015, Brief market report on cheese and processed meat market in Singapore, Retrieved on 1st October 2015, from; http://www.ice.gov.it/paesi/asia/singapore/upload/175/Brief%20Market%20Report%20o n%20Cheese%20and%20Processed%20Meat%20Market%20in%20Singapore%20%28Ja n.%202014%29.pdf Jabez, B2013, Advanced marketing management, London, Rutledge. Lisa, N2015, Product positioning and differentiation strategy, Retrieved on 1st October 2015, from; http://smallbusiness.chron.com/product-positioning-differentiation-strategy-5078.html Philip, C2010, International marketing, McGraw- Hill/ Irwin. Read More