Exportation Camel Milk from the UAE to the UK
In the UK, people are used to consuming cow and goat milk. This is a representation of the two varieties of milk consumed in the United Kingdom. The introduction of another milk product or brand may impact an unpredictable reaction in the United Kingdom market. Camel milk, particularly may find a favorable reception in the market because of the cosmopolitan nature of the population. Camel milk is especially common among Muslims (Zisa, 2011). This implies that a significant percentage of the Muslim population will readily purchase the milk. This is a fact considering that most of the Christians in the region may be reluctant in starting to use camel milk. This may be attributed to the religious prejudice related to camels, as animals (Andre, Delisle & Reveret, 2004). Camels are commonly found in the Middle East, which is a region dominated by Muslims. However, such can be considered fallacious thoughts, and proper education is required to demystify them. Foremost, camel milk contains a higher nutritional value compared to cow milk, to which most of the UK’s population is accustomed (Sinoa, 2009).
This information should be incorporated in the promotion of the milk. Besides, it is also important to assure the masses that freezing camel milk does not have any impact on its nutritional value in any way. There has been a religious tussle between Muslims and Christians; there are higher chances that Christians in the United Kingdom may perceive camel milk as a food for Muslims. This kind of thought may further affect the attitudes of potential buyers, thereby enhancing challenges in the demand for the milk products in stores. This may result into significant losses since there will be insufficient demand for the camel milk. However, the cross-cultural integration and globalization may help in resolving this problem, considering that people are now open to information and ignorance no longer dictates the thoughts of individuals.
According to the cultural theory of Hofstede, the presence of a mixture of people in a given place impacts cultural interaction and cultural transformation. This will promote the ready acceptance of camel milk products, which would otherwise be challenging. People in the United Kingdom have not known the value or the importance of camel milk. They may view the product just in the same way as they have cow milk but they this may change with time if there is intensive promotion. The above challenge may impact a cold reception for the camel milk in the market. For this challenge to be mitigated, the company has to conduct intensive marketing through educating the masses on the benefits that they are bound to receive from consuming camel milk.
This enlightenment will make them want to try the milk instead of cow milk. The religious attitude that camel milk is only meant for Muslims can also be addressed through education and proving to people that camel milk indeed has double nutritional value unlike cow milk. By assuring people on the nutritional value of camel milk, their attitudes and viewpoints will change, thereby enhancing favorable changes in attitudes towards increased demand for the product. Communications and marketing, including all the promotions for camel milk must be translated into English. This is important since it will help in making the camel milk an international product. The use of Arabic may affect the attitude of the UK population, thereby affecting the expected results.
Economic and Socioeconomic Forces
There are various factors that will affect the market in the United Kingdom. One of them is concerns about the confidence of the target customers. Customers in the United Kingdom often tend to be confident because of the stable economy. This confidence offers the opportunity for valid confidence that the products will find a market. The confidence of customers also results from the fact that people are financially endowed, giving them the power to buy products. The employment rate is also another element that should be considered. When the population is employed, or when there is a high employment rate, it would be easy to tell that such a country will have a stable economy. This means that inflation that might impact businesses may not take place.
The interest rates enforced by the financial institutions is also another good indicator for the investors to tell how to set their prices and establish an economic and monetary balance, in order to avoid being affected by the projected inflation. Matters of inflation and pricing will be directly related to the prevailing trends in the international market. The prices will not be dictated by the United Arab Emirates by the economy of the United Kingdom. In order for the UK businesses to grow, it would be important to allow the businesses to adopt partnerships with the local population and even the government. Collaboration with the UK companies will ensure that this product gets a favorable platform in the market since people would readily believe in it based on the level of local support that it acquires and the people’s trust in the companies with which the enterprise collaborates. Participation in the activities of the local communities like sponsoring a cause or sports program can be an effective way of popularizing the brand among the population and the targeted market.
a). Legal Forces
Legal forces within the United Kingdom also have an impact on the performance of the business that is to have its activities in the region. For instance, the employment law has measures that must be adhered to in the process of hiring. For example, the government does not allow the employment of minors or children. This may impact the availability of cheap labor from the young population. Besides, the government has also set the minimum wages that an individual can earn. This applies for the good of the citizens. Therefore, the company has to put into consideration, these regulations. Apart from the employment laws, there are also restrictions on international trade.
These laws are formulated to ensure that if there is any foreign company or investor that is not beneficial to the economy of the United Kingdom, there is no need of it operating in the region. The operation of this company promises immense benefits for the economy of the UK. Foremost, camel milk is a product that shall primarily contribute to the healthy growth of the population owing to its nutritional value. Besides, the company will provide numerous employment opportunities in the United Kingdom since there would be need for people to do sales and other professionals, whose employment would result into the overall growth of the region’s economy. Other laws like those of consumer protection must also be put in place by the government to make sure that its people are safe. This rule has a direct impact on the firm in various ways. It has to ensure that its products are always fit for human consumption.
b). Political forces
The political temperatures in a country affect the society’s business prospects. The United Kingdom experiences a stable and cool political atmosphere. There are no signs of revolts and uprisings that may result into political, social or economic rivalry. The prevailing attitudes of the political organizations may significantly impact the decisions of the government, which can potentially affect the tax policies and government involvement in trade pacts. In the United Kingdom, political predictability makes it easier and convenient for investment. Its political parties are found to make sound rationale and rarely would take part in violent confrontations. This is to ascertain that the government in power is in control of the stability of the economy. The political organizations have also prevailed on their adherents to abide by the rule of law, and the population is trained to seek legal redress for their dissatisfaction (James, 2013). This ensures a stable country and the businesses environment will also be well cushioned. This makes it an ideal investment destination and also expands the sales of camel milk, because there is a guarantee of safety in the UK for long term business activities. The accommodation of social diversity of the political organizations in the UK has further helped in creating dynamic and diverse population in the region. In attempts to penetrate into the UK’s market, political affiliation may cause lots of disparities and bias. Therefore, it would be wise for the company to remain impartial and independent when approaching political issues. This will ensure the acceptance of the products by people across all cultural and ethnic backgrounds. The business shall not identify with any particular group, whether political or religious.
c). Labor Forces
The company requires a greater workforce in order to effectively operate. The demand for labor is a requirement that is facilitated by the need of the company to raise revenues. The company therefore needs a larger human resource base to assist in marketing and processing of various raw camel milk products to finished products. This is attainable in the UK market, although the labor force is quite expensive. The company has to be ready to make compensations to employees effectively in order to ensure that its products reach a greater population in the market. The kind of relationship that should exist between employers and workers should be transformational. This shall naturally inspire the employees to work towards the overall good of the organization.
a). Industry Analysis
There are several milk producers in the United Kingdom, for example, Cadbury Dairy Milk producer has established a significant base in the UK milk market. Their products are known to have high nutritional value. The Dairy Farming Industry is also another milk producing company that has a high reputation in the UK’s milk market. These are the major players in the milk products market in the United Kingdom (Andre, Delisle & Reveret, 2004). Considering that there is yet another group in the UK that sells camel milk, the company shall have the opportunity to establish itself and display effective competition in the market (Emmaculate, 2012).
b).Competitive Strategy Using Porter’s Five Forces
There are various challenges that may make the entry and ultimate profitability of the camel milk not to smoothly sail through. Porter’s Five-Force theory helps in the examination of this phenomenon (Jack, 2013).
The profitability of a product is likely to attract new companies into the market. Considering that camel milk has not been in the UK market for quite a long time, the enterprise shall be the initial business in the market (Havaldar, 2005). This would be an opportunity for profit making and developing customer loyalty to the extent that if other companies try to follow suit, our company shall have an upper hand in terms of popularity and profitability.
The UK’s population is used to cattle milk. This creates a big threat since it would be a little challenging when it comes to convincing the masses that camel milk is the best. However, through the dissemination of information about the health benefits of camel milk, there will be an opportunity for the market to become successful against this trend. It will take some time for buyers to substitute the product that they are used to (dairy milk) with camel milk.
The customer bargaining power may put the company under pressure to move according to the demand price. If this is not well checked, the company may encounter losses. Therefore, it has to put up various measures towards curbing this. The bargaining power of the suppliers is also another element that can affect the entry of the product into the market. The suppliers may fail to supply the company with raw materials as required or even supply at higher prices. This may have a negative impact on the business. However, if the supplies are delivered on time and at the best prices, the enterprise is bound to register profits.
c). Company Internal Analysis
The company is better placed to make positive profits through the extension of its customer base in the United Kingdom. This I attributed to the fact that there is not any other company selling camel milk in the UK (Krevear, 2010). This would enable the company to have a monopoly of that market, thereby making great profits. It is also important that the company has an assured supply of camel milk (Jalan, 2005). This will ensure that there is a continuous flow of milk in the market. Even though there are other substitute milk products in the market; camel milk stands to gain an upper hand because of its nutritional value (Jack, 2013).
In order to sell camel milk in the United Kingdom market, the firm has to adopt the most reliable market entry strategy that would impact maximization of profits at all levels.
Key Finding from Group Portfolio
The company can possibly gain effective entry into the market since in the United Kingdom; there is no agency that supplies camel milk. The threats that may exist with regards to camel milk will be demystified through education and scientific proof of the health benefits of the milk.
Market Entry Strategy
The market entry strategy chosen is the non-equity mode, which entails agreements based on contracts. This strategy has various merits and demerits, as outlined below (Krevear, 2010).
Advantages (Havaldar, 2005).
- This mode offers the opportunity of accessing the market quickly.
- The resource is always concentrated towards major production, thereby eliminating losses.
- The management of exports has always been outsourced, therefore reducing processor from the management team.
- There is no direct link to the export procedures.
- There are risks of contradictions since many parties are involved.
- There is no control over distribution and this may negatively affect the brands in case the distribution procedures are not clearly defined.
However, this model stands to be the most ideal since it enables the organization to receive insights from the locals who have a better understanding of the marketing dynamics (Jalan, 2005).
Market Analysis (Competitive analysis, market segmentation and target market)
The competitors in the UK milk market are only companies that deal in dairy products. This gives us the best competitive advantage since camel milk has a much greater nutritional value compared to cattle milk. The company shall do the packaging for its camel milk products in different sizes in order to cater for the needs of different classes of people. Those who would be able to and need to purchase more will get their fill while those who would small packages will also get the value for their money. The firm targets all the milk users, but mainly children and those who need nutrients and even hospitals (Andre, Delisle & Reveret, 2004). Segmentation of the targeted groups virtually enables the company to acquire a larger market base both locally and on the international platform.
The company shall begin by selling the camel milk products as a discount as they also disseminate information about its health benefits. This shall prepare the people to develop confidence in the camel milk products, thereby promoting the firm’s grip on the market (Zisa, 2011).
Human Resources Strategy
The company shall strive towards creating a partnership with other distributing agencies and sales agents who will be offered better deals in the market and a reasonable share in the profits made from the sales of camel milk (Emmaculate, 2012). Seeking collaborations will help the company in getting hold of the target customers.
Other Relevant Issues
For effective entry into the market, the company will need to leverage on quality and effective, satisfactory customer service. It would also be of importance to train the sales representatives on the strategies of effective sales and brand relations.
It is clear that the company will easily penetrate into the United Kingdom market. The camel milk that is exported to the UK is one that is likely to receive favorable reception. It is also good that the marketing strategy and market entry is advantageous to the firm. This will make sure that there are reduced expenditures and less strain.
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