Provision Of High Quality Ready Meals In The UAE: Market Analysis

PESTEL Analysis of the UAE Market

Discuss about the Provision Of High Quality  Ready Meals.

Assignment one  entailed  a comprehensive  market analysis  of the  UAE  centered on its impact  on Bein Edaik.  Founded in the  year 2018 Bein Edaik is  a food company whose  vision is  the provision of high quality  ready meals  to its target clientele base of  busy  individuals who  do not believe in the existence of   fast healthy  meals.  To cater to a diverse clientele base, the  business  offers a  wide variety of cuisine  that include  Oriental, Indian,   Japanese, Western and  Malay.  In  reviewing the UAE market  and how it would  relate to the business, the group employed a SWOT, PESTEL and Porter’s analysis.  The tools  used will help in the attainment of a clear  understanding of the  market and how it will impact the business.

Through PESTEL analysis, the  group was able to develop a clear understanding if the UAE market and its  suitability as a location for doing business. From the analysis,  it is evident that  the   UAE market offers a number of opportunities for the organization. The  fact that the country is geographically located in a high traffic trade area  and its  has  an alliance   with the GCC implies  that it offers a large and diverse  customer demographic for the  company to target.  Countries located around high  frequency transportation corridors  tend to have a diverse population demographic which  is good for businesses in the region as they can cater to the  needs of a larger demographic. The fact that the country has enjoyed  a stable political system since its independence  in 1971 and that it operates on an ideology of  peace and justice serves  to make the  country a prime  location for foreign  direct  investment which helps  in  GDP growth. The  growth  in GDP is reflected in  the 1.3%  economic gains of 2017.  From the economic analysis  of the country, it is evident that  the UAE has  a large population demographic that is able to afford the products and  services that will be offered by the company. It also serves to demonstrate that a large percentage of the population fits  within the category of the clients for the company. This is  demonstrated in the fact that  the UAE has a  GDP per capita of $407 billion and  very low  unemployment rates. The fact that the country is economically stable with low  employment rates is quite beneficial for a new start up like Bein Edaik because of the fact that a significant percentage of the population will be able  to afford the food products offered by the  company. The low  unemployment rate also demonstrates that a significant percentage of the country’s population is working and as a result  most people lack the time to prepare home cooked  meals. This makes services offered   by companies like Bein Edaik highly  welcomed by the  expatriate and local communities. Bein Edaik’s expansive potential  customer base is evident in the fact that the country has a population of  9,121 million  with 61% of the  citizens being between the  ages of 25-54 which is the working age. This is important because it demonstrates that  the company’s target clientele base  occupies a  significant percentage of the population.  The  fact that globalization has led to  a mix of   different cultures in the country also serves to  demonstrate that   the organization has a diverse  customer demographic to choose from  thereby  leading to increased   opportunities of profit for the business.

Porter's Five Analysis of the UAE Market

Another aspect of the UAE  that will  work in favor  of the  business is that the country’s has a relatively easy process of establishing a business and that the  country is ranked  21^st with regards to ease of doing business. However, it is essential to note that Bein Edaik will have to  undergo a number of stringent checks by the regulatory bodies in charge of food  safety I the region.  From  the porters  five analysis, it is evident that eve thought    the UAE offers a  promising business   environment for  emerging companies, the food industry in the country is highly competitive. This is evident in the  number of competitors and substitutes for Bein Edaik.  The Porters five  analysis also reveals that the company will have strong bargaining power  with  regards to the sourcing of products. This is seen in the large number of suppliers  operating in the market who make it  easier for a buyer to change suppliers.  The fact that the  organization has four categories of   buyers to choose from and  only two substitutes makes it logical for one  to argue that  the UAE offers a valid  location for the company to grow.

Unlike in most other regions  across the  Gulf ,  the  UAE’s  food market is highly developed. This is  largely due to the fact that the country has  a strong social system which has  served to make  the country a highly  multicultural setting.  Expatriates constitute a considerable portion  of the country’s  population. As a result of this by offering different cuisines the company will be able to exploit the variation in population demographic across the country. This will   help in  developing  the clientele base of the organization. However, it is essential to note that by failing to  specialize on a particular cuisine the organization  runs the risk of over stretching its  operations which is likely to lead to  collapse.  From the facts provided, it is also  evident that the organization is likely to face a difficult challenge of growing in the country. Another way through which the organization seeks to provide the best customer experience is by investing significantly in employee training. Employees of the organization undergo stringent training programs which are aimed at equipping them with the skills needed to cater to the wealthy in society. Enhancement in technology has however, made some of its competitors to catch up to it and the objective of this first section of the paper is to provide insight on how the organization can improve its customer experience. Finally the organization should increase the number of activities at its facilities. By increasing the number of activities the organization will provide clients with more to do and in doing so enhance the experience of staying at the facilities.

Bein Edaik's Potential Customer Base

The basic model of  most businesses in the world is the creation of  services and products  which are sold  to consumers for a profit. This has served to make  the quality of products  and services a very important aspect  for  business because of the competitive advantage  they imbue to the  organization.   For businesses to be successful  under this  model, the services  and products needs  meet certain customer expectation with regards to  quality. Based on  this, it is logical to conclude that quality is  the value that  a consumer derives from a product and not the   technicality or cost of its  development. One organization that has over the years led  in the  development of innovative quality practices is  Toyota.  The company is able to trace its  quality assurance systems back to  its founding in 1905 when Sakichi  Toyoda  was  improving on the experimental loom models.  The  organization has implemented  a number of measure to ensure that its consumers  are able to  derive the most value from their products. This  section of the paper critically analyses Peter Drucker’s quote that, “ Quality in a product is  not what the supplier puts in but what the customer gets  out and is willing to pay for,” from  both a  marketing  and operations perspective with  Toyota as the test case.

The  Toyota company views quality  as the lifeline of the business and as a result it has implemented a number of   strategies to ensure that its products meet  the set quality. The company like most other customer centered businesses  defies  quality as  the totality of characteristics and features  of a product  that  relate to its ability of meeting and satisfying all  implied or stated  consumer needs.  Under this school of thought, the  ability of the product to meet or exceed the expectations of the customer  is utilized as the yard stick for measuring  the products quality level. The  company still operates under  the founders ideology that products should not be sold  until they have  undergone a careful manufacturing process  and numerous testing to ensure they are satisfactory.   The company holds that a products is of high  quality if it is able to  repeatedly pass all the  tests. Quality is the ability of a product to  repeatedly deliver  value  to a customer  at the level   that is promised by the organization.  To ensure that its products  comply  with its  definition of what  quality is, the company has implemented a number of  counter check system that are aimed at reviewing  quality.  One of the most effective strategies of quality assurance that the company  adopted is   Total  Quality Control(TQC). This  entails  the utilization of programs  that are aimed at  identifying and solving  quality issues  at the early stages of production or product use.   This systems serve to ensure any quality issue as they occur in the production process. A successful program that  envisions  the organizations view of quality is  the Toyota  Customer  Follow-Up System which  was implemented  in the year 1969.  The program provides  customer with an avenue through which they can be able to raise any quality concerns with the company which latter   works on them.   This  strategy allowed for the company to monitor customer satisfaction levels. By measuring customer satisfaction  levels  and  obtaining information from its clientele base, the organization is able to   enhance its rate of customer retention. This is  largely due to the fact that a customer who is highly satisfied is likely to remain loyal and purchases  more from the company as it improves on its product offering.   The information collected from the customers also helps the company in the development of a  marketing message to ensure it relates with the  customer demographic. Quality in the organization can be  categorized  into  four groups which  build on each other.  The  categories are design quality, manufacturing quality,  marketing quality and Total  quality.  Even though all the  quality categories reflect the  brand  identity of the  organization, the first three  focus only on product quality.  From the programs objectives it is evident that the organization views quality as the ability of a product to provide value to the consumer. This is also reflected in the fact that with regards to  Toyota products the consumer is the  final arbiter  on the  issue of quality.

Challenges Faced by the Organization

Due to the fact that  Toyota products are  developed largely based on customer input their customer  view of quality  does not differ  greatly with that of the company.  Through the Toyota  Customer  Follow-Up System, the company has been able to gather information  on what  their customers  regard to be a quality product. A review of the various responses reveal that a significant percentage of Toyota customers hold that  quality  lies  in the  reliability of a product. The  more reliable a product is the higher its quality level.  Toyota customers are  of the opinion that a product which can be able to satisfy their needs as they arise is highly reliable  and as a result is of high  quality.   In a 2018 study that was aimed at reviewing the  quality standards of different  vehicles  by company it  was revealed that a significant percentage of the  respondents argued that a quality vehicle is that  which was affected by the least number of problems affecting it.  Through an analysis of this  response it is logical to conclude that quality with  Toyota products is viewed in terms of reliability.  Highly reliable cars  experience the least number of problems and as a result are always  ready to service the needs of the customer.

One criterion of quality  that is universal for  the Toyota  company and its customers is  Zero Defects.  The company utilizes a staggered  system of production to ensure that any defects can be  detected and rectified before the vehicle is  delivered to the market. The counter checking system  enables employees who are up the production ladder  are able to catch any mistakes made by employees who are  down in the production ladder before the product  reaches the market.  The quality  criterion is  also important for customers who  make purchases on the assumption that  the products have zero defects. This is largely due to the fact that defects  impact the ability of the  product to operate  as expected. For  example,  faulty  a seatbelts can place the  life  of the  customer at risk  as it erodes on the reliability of the  car to protect the occupants in case of an accident.  The company implements a number of  measures to ensure that its products have no defects. This is largely due to  the facts that  the presence of defects  in a product   hurts the brand image of the company and as a result impacts the  marketing strategy. To deal with  the customer defined  defects,  organizations like  Toyota employ six sigma practices. Six sigma provides  a systematic and  organized  method for  the strategic improvement of processes and  development of  new product and  service development principles  that rely of  scientific and statistical  methods  that aide  in the deductions. The organization also employs the  DMAIC model  to  improve, optimize and stabilize is  manufacturing process thereby eliminating defects in the production  process. 

Employee Training and Facility Activities

Another criterion that both the  Toyota company and  its customers   consider when reviewing the quality of a product is the  number of feature and application possibilities that are ascribed to the product.  The more the features  and applications  ascribed to the product the  higher   the level of quality that the  company and customer base afford it.  For both  Toyota and its customer base, cars that are able to maneuver  through different  road surfaces and have numerous features are regarded as  of high  quality that cannot. This is largely due to the fact that the applications and features serve to enhance the value  that the consumer derives from the  product. The  number of applications  and features   affects the  marketing strategy of the company. This is due to  the fact that marketing strategies are based on the value  the consumer derives from the product.

Despite the similarities, there are areas of differences with regards to how the   organization and its customer base view quality.  An  area of difference between Toyota company and  its customer base is that  the whereas  the consumer  regards costly products as high  quality,  Toyota does not ascribe  quality to the cost. Studies indicate that a significant percentage of the Toyota  company consumer base  equate  cost with quality  of the product.  They hold the  view that the more expensive a  vehicle the higher the quality. This is due to the fact that high quality materials  tend to be costly  because of the high level of demand that is associate with them.  On the other hand, Toyota does not equate  high quality to  cost. The company has implemented a number of measures to reduce  on the cost  of production. Some of  the strategies that the organization employs is  lean manufacturing which is a systematic  technique  of waste minimization   in manufacturing.  

Another area of difference  between the two parties is that where as the  consumer views  quality with regards to  the value they derive from the product, the organization  views  quality  with regards to the  customer satisfaction  rate that is  associated  with  the product.  To customers the more value they get from the  vehicle the higher its quality level. However, the organization  has no mechanism of measuring the  value customers derive from its products and as a result measure customer satisfaction rates.  The higher the customer satisfaction rate  of a particular product   the more valuable it is to the organization. This is because high customer satisfaction rates  leads to   an increase in brand loyalty which  forces the organization to change its marketing strategy to one that is more   complementary of the brand image.

As indicated the Toyota  company has implemented a number of programs to ensure  conformity to  the quality standards of the organization and the global market. The organization established the Global  Quality Control Department  to audit its numerous quality assurance  departments of its different divisions, and gather information   regarding  critical  quality issues in the entire industry.  The organization also operates under the total quality management principles which dictate that all  the employees  must be  committed to the maintenance of  high  work standards  in different areas of the organizations operations. This  has been achieved through effective  use of the six  sigma practices  that serve to ensure that all the different processes of the organizations  operations are effectively executed. The  organization also has  established   and clearly defined quality  guidelines that draw from the industry set standards and  consumer input with regards to their quality needs.  To ensure that   quality standards are maintained within its operations, the organization has  established an effective  employee training program where the workers of the organization get trained in specialized production skills  thereby  ensuring there efficiency. The  organization also has an elaborate mentorship  program in which the  workers are recruited into the  organization in their youth and get groomed  on the  organizations  culture. This serves to ensure that Toyota maintance  a culture of high quality standards which is  a key aspect of  its marketing programs. The operations  and  marketing department of  Toyota  collaborate in a number of ways to ensure that the organization  maintance an image of  high quality products. The marketing department of the  organization has  over the years  capitalized  on the organizations  TQM  practices  as the  center of its brand identity. This  has led to Toyota being regarded as  an innovative  entity with regards to efficient  strategies that  ensure the quality of a product while at the same  time  reducing the cost of its production.