An export strategy and export development plan - Essay Example

An export strategy and export development plan Table of contents Introduction 4 Product overview 4 Objectives 4 Environmental analysis 5 Political 5 Economical 5 Socio cultural 5 Technological 5 Market entry strategy 6 Market segmentation and positioning 6 Distribution strategy 7 Business process and operation 7 Financial strategy 7 Conclusion 8 Reference 9 Bibliography 10 Introduction This is a business report about exporting strategy and development plan of a confectionary food product in the UK market.

Crazy Food Private Limited is a confectionary food company based in United States and want to export its new confectionary brand which is Crazy Bite in UK market. Exporting products in a new market requires a detailed analysis of the target market environment and development of efficient exporting strategies and planning. Therefore, this study contains a macroeconomic environment analysis with respect to export. Not only this, market segmentation and positioning for the product in the target market also have been analysed.

Finally financially strategy has been developed considering the market environment and marketing planning. Product overview The company produces process foods, ready to eat foods and many confectionary products. Crazy Bite is a new brand of confectionary category of products which different flavoured tasty sweets bar. This food product is available in different flavoured and different shapes. It is crispy in nurture coated with chocolate which contains ingredients like butter and cashews that are making the products more demanding.

Objectives Key objective of the company is to develop effective exporting strategy for its products to export in UK market. For this purpose the company needs to analyse the target market environment and other external forces which might influence the international export of their products. Environmental analysis Political Political environment for food for food export in a country refers to the government’s intervention on the exporting of food products in the country by the foreign companies.

The company must needs domestic food licence as they are planning to directly sales by its own through different retailers. It also needs to follow the rules and regulations for food business in terms of quality concern. Economical Global financial crisis had lent a large impact on the confectionary market in United Kingdom. Sales volume declined along the period ranging from 2004 to 2009. So, substantial changes in the domestic economy of target market might majorly affect the export business (Agriculture and Agri-Food, 2010, p.4). Socio cultural Socio cultural environment in UK for confectionary food products has not substantial effect on the market growth but it is factor of change in consumer trend of consumption food products due to change in food habits (PHR, 2009).

Confectionary food is targeted for mass people but a major percentage of this mass target segment is becoming health conscious which results a major change in their food habits (Regmi & Gehlher, 15). Technological Domestic producers of confectionary foods in United Kingdom are gaining a large percentage of market shares of this food market through use advanced technology like effective technologies in the production process. Such machineries are helping the firms for production of large volumes in much lower time than manual production process.

Market entry strategy Entering into new foreign market for export of new products is comparatively easier both producing and selling. The company produce food products which is low priced fast moving consumer products that has lower life cycle. So, the company needs to into the market through large retail chains like Carrefour, Tesco etc and these retail chains have huge number of customer base. So, the product can be accessible by a large customer base of different food habits and choices.

The company needs to price its products by average price of the top domestic brands so that it can be positioned among the top brands and enjoys higher price level. Market segmentation and positioning For exporting confectionary food, the company need to choose demographic segmentation of the target market. As consumption behaviour regarding purchasing of imported products is generally high to the domestic people of each country as they perceive imported products always have good quality. So, demographic segmentation with respect to age, food habits, lifestyle of urban households etc will be beneficial for the brand for effective market presence and adopting effective promotional strategies and activities.

Main target segment of this product is kids and youths. For health conscious and aged people the need to promote low calories and low sugar products (The Open University, 2012). Crazy Bite is such category of products which people generally like to have it on the go. Kids generally like these products in the Tiffin time. For aged people this type of sweet bar can be positioned complementary after lunch and dinner. So, for younger and kids this can be positioned snacks at time of break and on the go with friends and families (Brushett & Frankli, 2001, p.15). Distribution strategy The company can supply its export goods through large retail supermarket and also small medium community based departmental stores and snacks booths on the highways.

Selling the product through developed distribution network will be more beneficial and cost effective rather develop the through its own shops. Business process and operation As an exporting business, currency exchange rate is major influential factors for this business. For paying export duties and tariffs, the company needs to pay higher amount as it needs to pay in GBP which is high valued than dollar. The company needs to afford payment arrangement for a high degree of protection of exporting food products in UK in terms of letter of credit.

Distribution of this product needs to be fast and in highly hygienic transport process as it is confectionary food of lower life cycle. Financial strategy Most important financial activity is the efficient management of working capital for export business. The company needs to get finance from the bank for post shipment finance also for the development of marketing activities especially promotional purpose. Slimily as domestic business the company would face credit sales problems in terms of receivable time from the foreign customers which could affect the working capital and it is more risky for export business.

Conclusion Based on the market environment analysis for export business of the company, it can be recommended that confectionary food market is growing in spite of many economical factors. So, this US based company has higher opportunity in UK market if they effectively implement theses exporting strategies for international food export business. So company needs to focus on forewing market development through cost effective export strategies. Reference Agriculture and Agri-Food Canada. (2010).

Consumer Trends - Packaged Snack Food Consumption Trends in the United Kingdom. [Online]. Available at: http://www.ats-sea.agr.gc.ca/eur/5622-eng.htm#c. [Accessed on August 06, 2012]. Agriculture and Agri-Food Canada. (2011). Confectionery in Western Europe. [Pdf]. Available at: http://publications.gc.ca/collections/collection_2012/agr/A74-1-33-2011-eng.pdf. [Accessed on August 06, 2012]. Brushett, L. & Franklin, G. (2001). Market Planning for Value-Added Agricultural Product. [Pdf] Available at: http://agmarketing.extension.psu.

edu/Business/PDFs/market_planning.pdf. [Accessed on August 06, 2012]. PHR. (2009). Young people and food branding. [Pdf]. Available at: http://phrc.lshtm.ac.uk/papers/PHRC_B2-06_Short_Report.pdf. [Accessed on August 06, 2012]. Regmi, G. & Gehlher, M. (2005). New Directions in Global Food Market. [Pdf]. Available at: http://www.ers.usda.gov/publications/aib794/aib794.pdf. [Accessed on August 06, 2012]. The Open University. (2012). Market segmentation and targeting. [Online]. Available at: http://openlearn.open.ac.

uk/mod/oucontent/view.php?id=397437§ion=4.3. [Accessed on August 06, 2012]. Bibliography Fletcher, A. (2006). UK confectionary market outlook positive. [Online]. Available at: http://www.confectionerynews.com/Formulation/UK-confectionery-market-outlook-positive. [Accessed on August 06, 2012]. Key Note. (2011). Confectionary. [Online]. Available at: https://www.efolio.soton.ac.uk/blog/pd7g10_mang6184/2011/11/28/keynote-confectionery-2011-report-nestle-kraft-food-mars. [Accessed on August 06, 2012]. Mintel. (2011).

The chocolate confectionery market. [Online]. Available at: http://www.sweetretailing.co.uk/index.php/confectionery_advice/view/market_intelligence_from_Mintel. [Accessed on August 06, 2012].