Market Entry Analysis For Frosty Boy's Expansion To South Africa Or Turkey Essay.

You have been advised by the board of the company that they wish to expand the company’s operations internationally into either South Africa or Turkey. Your task, as the international marketing manager is to recommend which country should be selected and why (based on a market entry analysis, see below for instructions).

-Provide an overview of the main findings of your report, including key recommendation/s.

-Briefly describe the company’s existing target segment and marketing mix (4Ps for products and 7Ps for services), and identify the product or services main source of competitive advantage in Australia.

-Analyse the firm using a SWOT analysis framework: Analyse the firm’s internal strengths, weaknesses, and external opportunities and threats.

-Analyse the two countries provided using a CAGE framework. The CAGE framework should assess the cultural, administrative, geographic and economic distance between countries. The CAGE framework allows for the comparison of markets allowing managers to pinpoint key differences across countries that may handicap internationalisation.

-The CAGE framework should be conducted between countries, to allow for a comparison. It is up to you how you choose to present this data; however, the analysis should include comparisons between Australia vs (South Africa and Turkey).

-Also, consider other important characteristics of the host environment, such as market characteristics, consumer behaviour, sustainability, relevant competition, and growth opportunities in the countries.

-Identify and evaluate any pertinent environmental and ethical considerations. Consider corporate social responsibility in relation to these issues. The analysis should include comparisons between Australia vs (South Africa and Turkey).

Overview of Findings

Frosty Boy is an Australia manufacturer as well as distributor of frozen yogurt, beverages and soft serves which works internationally. Frosty Boy being a company of frozen yogurt, soft serves and beverages, targets mainly the children and the youths of Australia.

4ps of products

Products

The main products of Frosty Boy are frozen yogurt, soft serves, beverages, toppings, syrups, granita and many others (Frosty Boy, 2018).

Price

The price of the products is low however these are being delivered with high quality.

Place

Frosty Boy works in 54 countries and the headquarters is in Yatala, Queensland, Australia. The number of countries for expansion is growing day by day.

Promotion

Several types of promotional strategies are used by the concerned company such as social media promotion, physical promotion, and departmental promotion. Even, the company is attempting to expand its business in Turkey or South Africa based on their social media promotional strategy.

7Ps for Services

Product: The products are determined with handling the larger scale specific volumes of units.

Price: This is about the handling of marketing segments and how the products are produced for a better development in market.

Place: The elements are depending upon the customer availability. The product is not available in all the locations.

Promotion: The promotional programmes include the planning in the way how the customer approaches and Frost Company is able to serve them.

People: The people works on handling the customer contacts, personnel and management for working to administer and monitor the quality of the service.

Processes: The processes include the procedures, activities, protocols and the events which are for handling the step sequences and activities.

Physical Evidences: The evidences refer to the representation for the instance brochures of ice creams and the designing, or the business cars or the company website.

Competitive advantage

As the company is selling the high-quality products at low cost so there is high chance of getting competitive advantages over their Australian competitors.

Table 1: SWOT analysis

(Source: Created by Author)

CAGE framework on Australia Vs South Africa

Cultural Distance

Both South Africa and Australia are multicultural countries but there is difference between them in meaning. As stated by De, Vroom & Øverbye (2017), in South Africa, people having different culture live together but in Australia, people having same culture but different faced colored live together. So, there will be different in taste of people of South Africa. In Australia, language barrier is less as English is considered to be official language. However, on the contrary, South Africa has range of languages including English, Ndebele, Swazi, Sotho, and Northern Sotho.

Frosty Boy's Target Segment and Marketing Mix

In Australia, there is a single administrative law but in South Africa, a bunch of laws makes administrative. So, there is administrative difference between Australia and South Africa. There is no colonial linkage between Australia and South Africa. Between Australia and South Africa, there is not any trade agreement yet done. In accordance to Grant (2016), there is also not any regional bloc between South Africa and Australia. The physical distance between Australia and South Africa is 10497 km but there is no any common border between them. The GDP (Gross Domestic Product) of South Africa is 0.43% in comparison to Australia.

Difference between host environment of Australia and South Africa

As there is difference in culture of the people of Australia and that of South Africa, so they have different behavior of buying. As stated by Chen et al. (2017), the consumers of Australia understand the quality of products and prefer healthy products and they are always ready to pay more for the good quality products and the consumers of South Africa prefer brand but they think a lot of time to pay whether the price is fair or not. In accordance to Eriksson et al. (2015), there is good opportunity for growth in South Africa as the people of South Africa prefer soft serves, frozen yogurt. The competitive products of soft serves and frozen yogurt in South Africa are Gatti, Country Fresh, Polar and many more. There is good competition between frozen yogurt and soft serves in South Africa.

CAGE framework on Australia Vs Turkey

There is not any cultural similarity between the people of Australia and Turkey. The culture of Turkey is totally different than the culture of Australia. As stated by Hollender, Zapkau & Schwens (2017), the common language of Australia is English but the common language of Turkey is Turkish and some other languages of Turkey are Arabic, Kurmanji and Zazaki and many more. So, there is no common official language of Australia and Turkey. So, there will be communication issues. There is not any colonial linkage. There is not any previous trade agreement of Australia and Turkey and there is also not any regional bloc. The physical distance between Australia and Turkey is 14181 km which is very high and also there is no common border between Australia and Turkey. The GDP (Gross Domestic Product) of Turkey is 1% in comparison with Australia.

Difference between host environment of Australia and Turkey

SWOT Analysis of Frosty Boy

As there is difference between the culture of people of Australia and that of Turkey, so they have different behavior of buying. In accordance to Kramarz & Skans (2014), the consumers of Australia understand the quality of products and prefer healthy products and they are always ready to pay more for the good quality products but the consumer of Turkey are aware of quality but they take inquiry about condition of payment. The people of Turkey prefer soft serves and frozen yogurt so there is also good opportunity for growth. The competitive company of frozen yogurt and soft serves in Turkey is Mado and many more. There is not more competition of frozen yogurt and soft serve in Turkey.

Under ethical consideration, frosty boy must ensure human relation legislation of the countries. In Australia, being a frozen ice cream company, it needs to abide by fair work relation 2009 and public sector management act 1995. On the contrary in South Africa, companies need to follow The Labor Relations Act 66 of 1995. The codes are similar in these legislation, which can benefit frosty boy while their expansion in South Africa. In comparison to turkey, CSR is managed by Corporate Social Responsibility Association of Turkey (CSR Turkey). This helps companies and firms to maintain environmental sustainability. As stated by Rauschnabel, Brem & Ivens (2015), in Turkey, multiculturalism is one of the main cultural hindrances. In comparison to turkey, CSR is managed by Corporate Social Responsibility Association of Turkey (CSR Turkey). This helps companies and firms to maintain environmental sustainability. In comparison to Australia, Turkey's CSR Organization ensures that employees are more active and motivated towards their work. In Australia, public-private collaboration is another CSR initiative that ensures globalization. Thus, both countries have growth opportunity for frosty boy with their CSR administration.

After discussing a lot of things about South Africa and Turkey, South Africa can be chosen to expand by Frosty Boy to expand the business. The people of South Africa are multicultural and their tastes differ from each other and they like different varieties so there are good chances of growth. The GDP (Gross Domestic Product) of Turkey is 1% in comparison with Australia and the GDP of South Africa is 0.43% in comparison with Australia. The GDP of Turkey is higher than South Africa but as Frosty Boy is a food industry, so cultural and language factors are more important than GDP to grow the business.

CAGE Framework Analysis of South Africa and Turkey

Distance

As the distance between South Africa and Australia is less than the distance between Turkey and Australia, so it will be much easier to work in South Africa than in Turkey.

Common Language

Common language is very important to do business with another country because it is way of their communication. As there is no common language of Turkey and Australia so it will be difficult to communicate for business purpose and the company will face problem after in the beginning. South Africa, having English as a common language to Australia, no communication problem will occur.

Competition

In South Africa, many other companies are doing business of frozen yogurt and soft serves like Gatti, Country Fresh, and Polar. So, South Africa is in growing condition in that sector. In Turkey, there is very few companies are doing business of frozen yogurt and soft serves like Mado. It can be said that Turkey has space to grow the business of Frosty Boy but it is the fact that the business runs fast when it faces competition. So, South Africa is a good choice to expand business of Frosty Boy.

Reference list

De Vroom, B., & Øverbye, E. (2017). Ageing and the transition to retirement: A comparative analysis of European welfare states.Abingdon: Routledge. Retrieved from:  https://www.taylorfrancis.com/books/9781351960267

 Grant, R. M. (2016). Contemporary strategy analysis: Text and cases edition. John Wiley & Sons. Retrieved from: https://books.google.co.in/books?hl=en&lr=&id=DTDvCQAAQBAJ&oi=fnd&pg=PP15&dq=Market+Entry+Analysis+book&ots=emLNhGg41G&sig=DZUQzvK6u9G8tpLPpFkiqDcfyxA#v=onepage&q=Market%20Entry%20Analysis%20book&f=false

Chen, P. L., Kor, Y., Mahoney, J. T., & Tan, D. (2017). Pre?Market Entry Experience and Post?Market Entry Learning of the Board of Directors: Implications for Post?Entry Performance. Strategic Entrepreneurship Journal, 11(4), 441-463. Retrieved from: https://onlinelibrary.wiley.com/doi/abs/10.1002/sej.1251

Eriksson, K., Johanson, J., Majkgård, A., & Sharma, D. D. (2015). Experiential knowledge and cost in the internationalization process. In Knowledge, Networks and Power (pp. 41-63). Palgrave Macmillan, London.Retrieved from: https://link.springer.com/chapter/10.1057/9781137508829_2

Hollender, L., Zapkau, F. B., & Schwens, C. (2017). SME foreign market entry mode choice and foreign venture performance: The moderating effect of international experience and product adaptation. International Business Review, 26(2), 250-263.Retrieved from: https://www.sciencedirect.com/science/article/abs/pii/S0969593116301056

Kramarz, F., & Skans, O. N. (2014). When strong ties are strong: Networks and youth labour market entry. Review of Economic Studies, 81(3), 1164-1200. Retrieved from: https://academic.oup.com/restud/article-abstract/81/3/1164/1599488

Rauschnabel, P. A., Brem, A., & Ivens, B. S. (2015). Who will buy smart glasses? Empirical results of two pre-market-entry studies on the role of personality in individual awareness and intended adoption of Google Glass wearables. Computers in Human Behavior, 49, 635-647. Retrieved from: https://www.sciencedirect.com/science/article/pii/S0747563215001880CAGE Framework, (2018), Country analysis, Retrieved from https://ghemawat.com/cage on 23rd August 2018

Frosty Boy, (2018), Products & services, Retrieved from:

https://www.frostyboy.com.au/products-services on 30th July 2018