Nelson Wine Company Socio-Cultural Environment - Case Study Example

Executive Summary Nelson Wine Company is looking towards expanding its business and has chosen Greece as a destination to conduct their business. Nelson Wine Company has to look towards ensuring that they move ahead with their proposed expansion plan of conducting business in Greece due to the wide opportunity that the market presents. The fact that Greece has a similar culture and looks towards ensuring that they are able to provide maximum customer satisfaction by supplying wine which is of the finest quality will ensure that they are able to improve their service. In addition to it the different opportunities that the country presents due to improving economy and similar culture along with the increase in demand for wine will ensure that Nelson Wine Company is able to move ahead with their strategy of expanding in overseas will thereby ensure that the overall business grows and will fetch maximum opportunity for moving ahead in the business. Table of Contents 1.0 Introduction 3 2.0 Political Environment 4 3.0 Legal Environment 5 4.0 Economic Environment 6 5.0 Socio-Cultural Environment 7 6.0 Technological Environment 9 7.0 SWOT Analysis 10 8.0 Recommendations 12 9.0 References 14 1.0 Introduction Nelson Wine Company as the name is a producer of wine based in Australia. The company has been operative since 1993 and has grown in size and volume due to sheer quality of wine being produced by the company (NelsonWine, 2012). The company also looks towards producing different varieties of wine which has helped them to ensure that they are able to tap different segment of the customers. The company has looked towards ensuring that they select wine that has to be manufactured based on quality and taste, providing the required training to the staff so that they are able to ensure consistency in taste and quality while producing wine, and having elegant glasses and utensils so that the people who consume the wine are able to see the difference between the services of Nelson Wine Company and other wine company. Nelson Wine Company has choosen Greece as a destination for expanding their business. This is primarily on the fact that the climate of Greece and the culture suits the consumption of wine. The fact that there are many wine producers and suppliers in Greece and people look towards special taste and services makes it a very lucrative destination. This will ensure that Nelson Wine Company is able to cater to a market where there is already a demand for wine and being able to provide quality wine and proper services will act as a path through which the business can be grown (Hannan, 2011). Nelson Wine Company while looking towards expanding their business in Greece will look towards exporting their wine to Greece. This will require that Nelson Wine Company looks towards developing the supply chain network. To ensure maximum efficiency and quick service delivery standards Nelson Wine Company has to look towards using the present distribution network and also develop new channel partners. This will involve engaging into agreement with dealers and suppliers and looking towards developing the supply chain network which will help to maximize the reach and ensure that Nelson Wine Company is able to circulate their wine to far off places (Thompson & Strickland, 1999). Nelson Wine Company also has to ensure that they use the required technology to keep track of the market movements and needs of the market. This will help them to prepare strategies through which the business will be able to ensure that better strategies based on the market is developed and will help to provide the necessary fundamentals through which the entire business is able to highlight long term growth and prosperity 2.0 Political Environment 2.1 Government Stability: Greece has a democratic form of government where people elect their leader. The total number of seat in the parliament in 300 out of which the ruling party has to have a minimum of 151 seats. Elections are held every 5 years and the form of government is stable which will ensure that Nelson Wine Company will be able to ensure that the rules and regulations that the government develops will be given sufficient time to be implemented (Binkley, 2006) 2.2. Government Contribution: The government has looked towards framing policies which ensures maximum opportunity of growth and has framed policies which allows overall growth. The government has also looked towards ensuring that they are able to open the economies and have ensured that overall development of the economy is possible. The government has also ensured that a free trade agreement is developed between Greece & Australia which is impact positively and helps to ensure that the business is carried out effectively. In addition to it the government of both the countries has also acted positively in making changes in the political and legal environment so that developments can take place in the business sector. 2.3. Accessing the Risk of Taking Business in Greece: The strategies and policies that have been framed by the government highlights that Nelson Wine Company will be able to improve their business and will find a favorable condition which will help the business to grow. The company will find support from different government bodies and based on it will be able to maximize the opportunities of growth 3.0 Legal Environment This will help Nelson Wine Company to understand the manner in which the legal environment will have an influence on their working and the strategies that they have to develop to ensure that they are able to maximize the gain from it 3.1. Legislative Framework: The government allows the use of organic food which includes wine which has been made from organic grapes. With regard to inorganic food the government has certain rules with regard to oxygen content, filtration, salt and fermentation which has to be followed to ensure that the business is conducted in a smooth manner 3.2. Business Law: The government requires that the different players performing in the market obtain the required license and certificate from the government which allows them to carry out their operations. The government is also strict on bribery and requires that proper rules and regulations are followed to ensure smooth functioning of the business units. 3.3. Labor Laws: The government has in place labor laws which prohibit children under the age of 14 to work. Further laws have been developed regarding the working hours where people have to work for 8 hours and also have looked towards ensuring that the compensation and working environment is such that it ensures proper facilities for the employees. In addition it the government has ensured that proper facilities are provided which will help to provide proper healthy and safety measures and will prevent the accidents which might take place. 3.4. Accessing the Risk of Taking Business in Greece: Nelson Wine Company has to look towards adhering to the legal requirements and have to obtain the necessary permission and certificate from the respective body. It will also require that Nelson Wine Company adhres to all the law requirements so that they are able to perform in the correct and deligent manner. 4.0. Economic Environment This will help Nelson Wine Company to understand the manner in which the economic environment will have an influence on their working and the strategies that they have to develop to ensure that they are able to maximize the gain from it 4.1. Interest Rate: The interest rate in under control as the monetary and fiscal policies have ensured that inflation doesn’t rises. This has helped to control the rate of interest rate and has ensured that proper growth of the economy. The present interest rate for the economies is under control and ensures proper return and developments of the economy 4.2. Currency Exchange Rate: The country has a flexible exchange rate and is traded as around 0.77US$. The flexibility in exchange rate has ensured that economies are able to engage into trade ensure that proper situation is prevalent through which development can be made 4.3. Economic Growth Rate: The economic trends highlights that the business has been able to grow as the economy is witnessing a positive growth rate and has been attributed to the different sectors which has contributed towards the growth (World Bank. 2010). The economy of Greece has shown a positive growth rate which contributes to the fact the doing business in Greece will ensure proper returns on investment 8.4. Analysis: Nelson Wine Company has an opportunity to use the economic indicators to their advantage as improving and positive growth rate will ensure that the income level of the people increases which will provide an opportunity through which the organization will be able to ensure maximum productivity and increase in demand for their products and services. 5.0 Socio-Cultural Environment This will help Nelson Wine Company to understand the manner in which the economic environment will have an influence on their working and the strategies that they have to develop to ensure that they are able to maximize the gain from it 5.1. Hofstede Cultural Dimension: This aspect helps to understand the manner in which cultural influences have on the overall working strategy in Greece. Despite difference in culture being witnessed as compared to Australia still there is a demand for wine as the climate and condition of the society has made people look towards consuming it. 5.1.1. Collectivism Vs Individualism: The culture of Greece also highlights that both individualism and collectivism is considered important in the culture. It is seen that people look towards being in groups and favor collectivism more than other 5.1.2. Power Distance: Culture has an influence on the power distance as well. Having a democratic form of government has ensured that the power distance is spread but still certain degree of power imbalance is witnessed. This has made the interference of government to increase in certain areas so that better cultural integration is possible and growth possible 5.1.3. Uncertainty Avoidance: Greece shows a high degree of uncertainty avoidance and helps to understand the manner in which culture has an influence over different things. It has been identified that culture has a role and influences decision making but cultural integration and people coming from different region and culture has reduced the degree of dependence on culture slightly (Gamble & Thompson, 2011) 5.1.4. Time Orientation: The culture of Greece is forward thinking at the same time preserving their past culture. This has made the cultural requirements of Greece to be such that a balance has been maintained between the past and the present which has helped to move forward and develop strategies to improve the overall working 5.1.5. Quality Vs Quantity of Life: The culture of Greece has been seen to lay stress on the quality of life. This has thereby made their culture look towards purchasing products and services which provides maximum comfort and has shaped their purchasing habits accordingly. The improving economy and rising disposable income has further helped to ensure that more and more people look towards purchasing products based on their requirements which has thereby been affected by the social cultural factors Factors Reflection of the economy of Greece Hofstede Cultural Dimension Increasing demand and trend towards wine Collectivism Vs Individualism Mixture of Collectivism Vs Individualism Power Distance Low Uncertainty Avoidance High Time Orientation Forward thinking Quality Vs Quantity of Life Importance to Quality 5.2. Analysis: Nelson Wine Company has to ensure that they integrate the cultural requirements of Greece and based on the market requirements and cultural preferences develop their product and services. The fact that the culture of Greece is open and look towards adopting new ideas will ensure that Nelson Wine Company is able to use it and develop its services better. 6.0. Technological Environment This will help Nelson Wine Company to understand the manner in which the technological environment will have an influence on their working and the strategies that they have to develop to ensure that they are able to maximize the gain from it 6.1. Technological Infrastructure: The technological advancement as seen in Greece has shown that the economy is well placed to use technology towards improving its strategy towards improving its manner of doing thing. This has enabled the business sector to witness growth and has thereby contributed positively towards their growth. 6.2. Communication Networks: The development of technology has permitted the development of communication network which ensures that quicker and faster decisions are made. This has also improved the entire process through which communication takes place and provides an advantage to improve the working condition further (Buckstein, 2010) 6.3. Logistics Network: The economy has witnessed growth and development in the logistics which has helped the business sector to ensure that the goods and services reach even to the far off places. This has also ensured that overall development in services is possible and has helped to improve the entire process of carrying out operations. 7.0 SWOT Analysis The SWOT analysis looks as follows (Monsivais & Drewnowski, 2007) Strengths Nelson Wine Company has a strong brand name: as the company has been in operations for a number of years which has earned them the required name and fame Offers a wide range of products: like different kind of wine in different quantiyt with different flavor which gives the customer a range to chose from Sound Financial Performance: as the company has been able to generate profits and have the required finance to invest in different areas through which the business grows Efficient Workforce and proper management: in relation to the tangible and intangible resources because of proper management which has helped to develop strategies according to the requirements Weakness Overdependence on the Australian market: for sale of their products which is slowly saturating and requires to move to other countries to improve the business opportunities Decreasing market share: for sale of their products which is slowly saturating and requires to move to other countries to improve the business opportunities Dilution of the brand image due to recalling of various products: which has affected the brand image and requires development of rules which looks to ensure proper strategies for growth Opportunities Focusing on new emerging markets: due to increase in demand from those markets especiall Greece due to the opportunity that the market presents Look towards strategic growth: by having stores at locations which are more accessible so that more and more customers pour in and provides an opportunity for improved business Threats Intensifying competition: both from local and international players due to opening up of the economy which has allowed different players to function in a manner that has intensified competition Increasing governmental regulations: which has reduced profits and made it difficult to sustain the business as the legal process has increased and this has become complex due to increasing rules relating to obesity Decrease in the supply of high quality wines affecting the quality of wine: as there are wine which are produced at lower cost and have an inferior quality which is thereby affecting the overall business. 8.0 Recommendations Nelson Wine Company has to look towards ensuring that they move ahead with their proposed expansion plan of conducting business in Greece due to the wide opportunity that the market presents. The fact that Greece has a similar culture and looks towards ensuring that they are able to provide maximum customer satisfaction by supplying wine which is of the finest quality will ensure that they are able to improve their service In addition to it the different opportunities that the country presents due to improving economy and similar culture along with the increase in demand for wine will ensure that Nelson Wine Company is able to move ahead with their strategy of expanding in overseas will thereby ensure that the overall business grows and will fetch maximum opportunity for moving ahead in the business. 9.0 References Buckstein, J. 2010. Savvy Shoppers in a Brave New World. Bottom Line, 26(4), p. 28. Binkley, J. 2006. The effect of demographic, economic, and nutrition factors on the frequency of food away from home. Journal of Consumer Affairs. 40, pp. 372-391. Bristow, D. and Frankwick, G. 1994. Product manager influences tactics in marketing strategy development and implementation. Journal of Strategic Marketing, 2 (3), 132-147 Gamble, J. E., & Thompson, Jr., A. A. 2011. Essentials of Strategic Management. New York: McGraw-Hill Irvin. Hannan, M. T. 2011. Organizational Analysis. Encyclopedia Britannica Monsivais, P. & Drewnowski, A. 2007. The rising cost of low-energy density foods. Journal of the American Dietetic Association. 107, pp. 2071-2076 Thompson, Jr., A. A., & Strickland, A. 1999. Strategic Management (11 ed.). Mcgraw-Hill World Bank. 2010. Global Economic Prospects: Fiscal Headwinds and Recovery. World Bank Read More