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Introduction Background
Market Research Strategy Gantt
ChartConclusio
n
1951
1990
2000
20102014
Family-owned company
in the 3rd generation
ca. 850 employees
ca. 70,000 square meters of
operating area
Sales of ca. 130 million euros with
more than 60% export share
Introduction Background
Market Research Strategy Gantt
ChartConclusio
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Innovation Quality Performance Enthusiasm
Ideas that stick
Enthusiasm for partnership
Quality in every detail
Zest for top
performance
Introduction Background
Market Research Strategy Gantt
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Why enter Russian Market?
2013 To gain a large market share To widen a customer base Rapidly increasing automatic segment Forecasts: ● in 2014 Russia will be the
largest automatic market in Europe ● in 2020 Russia will be Europe’s
largest and world’s fourth-biggest consumer market
As a result – increasing profit
Introduction Background
Market Research Strategy Gantt
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What are the customer needs in Russia?
High quality;Fast execution of work and meeting of deadlines;
Default of defective goods;Face-to-face work with every customer.
7 consumer groupsInnovators Achieved
Stable Spontaneous
Upwardly Oriented Traditionalists
Saving-Oriented
Introduction Background
Market Research Strategy Gantt
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SWOT - analysisStrengths Weaknesses
Opportunities Threats
QualityWide range of products (7 groups)Flexible time of deliveryNovelty respectively to the Russian marketInnovationsStable export ratesThe lowest costs for advertising
Low familiarity at the Russia market High cost structure
Time for adapting to the Russian termsNeed for opening new office and storages (hence increasing of costs)
The lack of substitutes of the same quality Minimal competitionThe receptive market (the 9th largest consumer market in the world)The growth of the automatic sector (13% in 2013)Comparative low tax ratesIncreasing euro exchange rate
Probable low demand at the very beginning
The size of the country + high traveling costs
Uneven developing of the Russian regionsUnstable political situation
BureaucracyLow transparency of the legal system
Introduction Background
Market Research Strategy Gantt
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PEST - analysis
EconomicPoliticalSocial Technological
Unstable world political situationWTO regulation + MFPAdministrative burdens
State guarantees for nonresident business
Low economic growthHigh inflation rate (7,1%)
Increasing euro exchange rate + currency fluctuationsModerate FDI climate
SeasonalityUnstable probability of solvency
Low possibility of the changeable customer behavior (B2B)
Demand for high quality at the minimal price
Absence of the same technologies in Russia
Low familiarity level about provided technologies
But high technological potential
Introduction Background
Market Research Strategy Gantt
ChartConclusio
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Porter 5 forces - analysis
Competitive rivalry within an industry
Level: medium
Bargaining power of customer
Level: medium
Threat of New EntrantsLevel: low
Bargaining power
ofsuppliersLevel: low
Threats of substitute
s products
Level: medium
Competitors are mainly producing labels for
consumer health which is not our business
High price sensitivityHigh market capacity for
new entrants
All the producing processes are inside
of Germany
Expensiveness of
switching costs
Introduction Background
Market Research Strategy Gantt
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Why enter now?In 2014-2015 the growth of Russian economy will be very
slow
Our company will have the comparative advantage, because we don’t import raw materials. But Russia does.
In 5 next years in Russia more than 800 new hypermarkets will be opened, so there will be the
increasing demand for packaging, labels and other products of our company.
Introduction Background
Market Research Strategy Gantt
ChartConclusio
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Main strategy
1)Establishing a sales office
2)Establishing storages
3)Production
Short-term phas
e
Long-term phas
e
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Market Research Strategy Gantt
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Main strategy
1) Establishing a sales officeo setting up sell representative
o establishing 2 offices
Places: Moscow (as the capital and the
center)Yekaterinburg (for reducing travelling
costs)
Introduction Background
Market Research Strategy Gantt
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Main strategy
2) Establishing storagesIn several years (2-3 years) more places
Until this time – 2 cities and renting
Places: Moscow (as the capital and the
center)Yekaterinburg (for reducing travelling
costs)
Introduction Background
Market Research Strategy Gantt
ChartConclusio
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Main strategy
3) ProductionIn 5-7 years it’d be possible to buy some spaces and
produce products in Russia
Places: Moscow (as the capital and the
center)Yekaterinburg (for reducing travelling
costs)
Introduction Background
Market Research Strategy Gantt
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Pricing
Global marketing(the prices will be like at all other markets the
company serves) Dependence on the individual product
(from very cheap to very expensive)
+ terms and time of delivery + complete new product layouts will be more cost intensive
Introduction Background
Market Research Strategy Gantt
ChartConclusio
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Advertising
BTL-advertising
Fairs and Exhibitions:
InterpackRosUpackExpo
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Market Research Strategy Gantt
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Advertising
ATL-advertising
Catalogues and professional press+
Website and web advertising
minimal costs
+ sponsorships and charity+ cooperation with the Medci (network of private medical clinics)
Introduction Background
Market Research Strategy Gantt
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Financing and distributionForm of distribution:
Business to BusinessProducts will be sent from
Germany to Russia (at least ~ first 5 years)
Financing:We’ll use our own funds and
resources + possible government
subsidies
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