About the company
Brookside Dairy Limited is based in New Zealand. The company intends to enter the China and Middle Eastern markets with its milk powder product. This paper presents the company’s financial statement and a marketing plan to penetrate the markets in China and the Middle East.
Financial statement
Opening entries to set up the accounts
- Brookside Dairy Limited
- Balance sheet statement
As at 1st February 2015
The balance sheet is prepared based on the assumption that the business will commence the milk powder export on 1st February 2015. To start up the export business, the owners will require a total capital amounting to $3,754,500. The owners will raise $1,637,500 and the remaining will be obtained by using long term debt facilities amounting to $2,030,500.
Brookside Dairy Limited
Trial balance
As at 1st February 2015.
Marketing plan
Introduction
Basically, this marketing plan targets the China and the Middle Eastern bloc markets. In order to release the final milk powder product to the targeted markets, the process will commence with buying milk in New Zealand and then shipping it to a processing factory in China. The processing factory will then release the final product into the market. The penetration is discussed in the marketing plan below.
Doing business in China and the Middle East
Marketing challenges
Political requirements conformity
The essential political requirements of Brookside Limited towards the entry planning and development phases are those that impact directly on the stability of the Chinese and Middle Eastern cultures. The overall development levels exhibited by the Middle Eastern market are relatively stable and high though still fragile, thus, discouraging prospective investors. The rate at which the economies in the Middle East and China are growing is incredibly rapid and this has led to the diversification of the economy.
Demographic segmentation
The penetration strategy should be that which causes minimum disturbances to the company in terms of financial resources and the dairy organizational activities. The demographic factors are deeply entrenched in the religious perceptions in China and the Middle East. These two markets are characterized by Buddhist and Islamic religions respectively. Thus, the company must present its milk powder product within these religious demographic characteristics to ensure that the potential customers are in a position to identify with the product.
Legal aspects
The provisions of patent and trademark rights in these markets have helped to eliminate the chances of fraudulent attempts on a company’s product. The trademark rights in China and the Middle Eastern regions will ensure that the company is not disadvantaged. The company could take up this as an assurance of the protection of its product against illegal dealers.
Marketing opportunities
The inflation rates in the target markets are at a minimum and the currency management authorities are confident that the rates are not only minute but also manageable. Thus, it will not have a substantial macro effect on the market demand pillars. The company’s revenues are projected to increase if it opts to invest in these markets. Besides, these markets have more than one billion potential customers.
Entry strategy
With a capital base of more than three million dollars, the company possesses veto powers above other milk powder exporters. Reflectively, to capture the distribution channel, the beneficial interests will be distributed across the commodity pool in the two markets. Also, this strategy will facilitate the restructuring of effective sales and public awareness to develop product knowledge among the targeted clients in China and the Middle East. Correspondingly, the Brookside Company may seek to offer different packages and sizes for the milk powder product to ensure that customers, who buy in relatively smaller quantities but in bulk, are integrated into the marketing plan. Besides, the plan should offer a variety of different distributions channels that will be vital in the attraction of new customers in the Middle East and China markets.