Describe about the “Business Capstone Project”.
From the beginning of the development of human culture, immemorial plants are regarded as a source to develop medicine to protect health of the humans. At the beginning, knowledge regarding medicinal property of the plants is developed through the trial and error method. Human curiosity regarding have played a great role in utilizing plants as a source of medicine. In present day, herb products are very popular in the countries like India, Pakistan and other Asian countries. Many patients suffering from several diseases have able to recover quickly with the help of these herbal products. This established the fact that the herbs product can be greatly utilized to improve the health condition of the people all across the world. In fact, unlike many other medicine products, herbal products come with very little side effects. Therefore, people from all across the world can actually utilize the herb products much more effectively. The major source of herb products such as herbal plants are comes from the valley of Himalayas. However, utilization of herb products is still limited in the major parts of the European countries and China in particular. This implies a huge potential market for the herbs products that the marketers can utilize to expand the businesses. The study focuses on to evaluate the hypothesis that will describe whether the introduction of the herbs products can actually have positive impact on the China and European market or not.
2.1 Topic 1 (Present demand):
For therapeutic purpose, use of herbal medicine has increasing all over the world in past few decades. Therefore, the present demand level of the herbs product is also increasing in the world market. According to Luo et al. (2016) majority of the drugs that is regularly used in the developing countries have a certain percentage of herbal origin. In fact, most of the prescriptions actually contain at least one medicine that is developed through the use of herbal medicine. As per the records of the World Health Organization, almost 25% of modern day drugs that used in the United States of America developed with the use of herbal medicine. According to Jan et al. (2013) more than 125 active compounds derived from the higher plants from Himalayas are vastly used in the allopathic medicine treatment. Therefore, the use of herbs product are not only restricted to the development purpose of the herbal medicine products only rather it is using in the modern and most popular allopathic treatment procedure as well. For that reason, Balkrishna et al. (2012) mentioned that the present level of demand of herbs products fount in the valley of Himalayas is mere just an indication of the kind of future demands that the world has to face in providing herbs products all across the world.
As per the article by Jan et al. (2015) almost 80% of the modern procedure of allopathic treatment used particularly in China are positively correlated with the traditional use of the plants. Farooq et al. (2014) mentioned in the study that more than 7000 medicinal compounds that is derived from the plants are currently used in the modern treatments systems that has major influence on the present demand level of the herbal products. In addition, almost 80% of the world population is currently utilizing herbs medicine in order to lead a healthy life. It also highlighted the fact that the kind of revenue that the company can able to generate by introducing more and more options for the development of the medicine purpose. According to Parihaar, Bargali and Bargali (2014) present annual revenue from the herbal products and herbal medicine is around $7.5 billion in the Western Europe market. In China, the revenue from the herbs product is up to $16 billion. On the other hand, the present level of demand in the Latin American countries like Brazil is almost around $180 million. Pala et al. (2016) mentioned that the increase popularity of allopathic treatment procedure does not able to diminishes the popularity of the traditional treatment procedure in the Asian countries like China, Thailand, Japan and South Korea. Therefore, utilizations of herbs products found in the Himalaya’s can actually improve the current level of variety that the herbal medicine has in the world market. For that reason Sharma et al. (2015) mentioned in the article that there is still huge amount of scope is present to utilize Himalayans herbs for the purpose of developing herbal market all across the world.
H0: Himalayan herbs does not have huge amount of present demand in China and European countries
H1: Himalayan herbs do have huge amount of present demand in China and European countries
According to Saxena, Ahmad and Gupta (2013) herbs products demand for the utilization in the medical purposes will only going to increase in the near future. Therefore, the markets like China will have to deal with many new market entrants that are looking to capture the market of herbs product. In fact, China market in particular is very open to competition. As the demand for the herb products is increasing all across the world, it is expected that the market will be filled with many new market entrants in near future. However, Jeelani et al. (2013) mentioned specific barriers related to enter into the new markets in the herbs product.
Substitute of the one herbs products with another herb products is also played a huge part in the increasing the competition in the China and other international market. Radha et al. (2013) mentioned that in many cases substitutes is also passed off as being the same as the ingredients. This also played a huge part in increasing competition in the herbs market. Arya et al. (2013) highlighted usage of synthetic alternatives has also played a crucial role in increasing the competition in the market. It actually created a huge amount of negative impact on the development of the businesses of the herbs products. Since, it induces many companies to capture the market by introducing the synthetic alternative products. According to Kumar et al. (2013) herbs product market in the European region is still not developed completely, as there are many scope to expand the markets in the future. Particularly in the countries like USA, UK, Germany, Switzerland, many medicine centers are looking to enhance the positive effects of the herbs products. As per the article by Alam (2015) there is only one-way to increase the popularity of the herbs medicine products is to make it available all across the world. It highlighted the fact that if herbs plants can be delivered in the desired pharmaceutical companies then it can definitely able to counter the challenges from the substitute’s products in the market successfully.
H0: Substitute of herb products will not create high level of competition in the China and European market
H1: Substitute of herb products will create high level of competition in the China and European market
Regardless of the industry or products, companies have to face many difficulties to exports products from one country to another country. One of the major issues regarding the export of the herbs products that the company has to face is the change in the culture. Since, culture does have huge amount of impact in the medicine industry. Since, cultural differences actually can have impact on the popularity of a particular plant in developing medicine of products. In fact, the companies also have to consider the factors like exchange rate fluctuations, currency payments and internationals credits risk. According to Singh (2014) fluctuation in the exchange rate can actually hampers the company’s profit margin to a great extent. Particularly, collection of the herbs products from the valley of Himalaya requires huge amount of investment from the companies. Therefore, the companies will look to maximize the profit margin by introducing herbs product across the world. However, fluctuation in the currency value or in the exchange rate actually affects hugely on the profit margin of the company. Therefore, companies generally think twice to introduce herbs product in the China or international market. According to Joshi (2013) it is easier to introduce herbs product in the countries like China where the products already has huge popularity in the medical treatment. However, introduction of herb products in the European countries demand much more creative strategies from the company. According to Patel, Rathod and Ezhava (2013) the main issue relating to the introduction Himalayan herbs in the European market is preserving the quality of the plants at the time of transportation to the European countries. Since, the plants will have to travel a huge amount of distance before it can be introduced in the European market.
In addition, the companies also have to provide assistance to the foreign dispute and bad debt to make sure that the herbs product can actually able to delivered to its desired destination without any violation of international trade rules of the government. Since, international trading not only involves revenue of the particular company but also revenue that the government that generated from the international business activity. Particularly for the products related to medicine and healthcare, international trading has to follow regulation. Ganaie et al. (2016) mentioned that Medicine, Healthcare products Regulatory Agency (MHRA) must have to follow by the companies at the time of exporting herbs product in the United Kingdom. On the countries like Singapore has regulation namely Singapore Medicine Acts that every companies will have to follow at the time of introducing or exporting herbs medical product to the country. Drug Administration Law of the China is necessary to follow for each and every company that are willing to introduce herbs products in the Chinese market.
However, these regulations cannot be exactly mentioned as an issue for the internationalization of Himalayan herbs product. Since, government of different countries imposes these rules and regulation so that everyone within the society can actually able to gain the benefits of the healthcare structure of the company. Still, these regulations do create obstacles for the company, as they have to deal with the many restrictions, which actually create a huge amount of negative impact on the revenue level of the company.
H0: Import-export will create difficulties in the business expansion of herb products
H1: Import-export will not create difficulties in the business expansion of herb products
According to Joshi and Yadava (2015) strategies regarding to the introduction of Himalayan herb products in the international market depends on the several factors related to the market that the company will have to follow. Otherwise, the prime objective of introducing herbs might not get fulfilled for the companies. The factors described as follows:
As per the article by Mir (2014) companies will have to segment the international market in to different sub-markets. It is necessary for every company, as it will help to introduce herbs products in the international market much more effectively. According to Kumar et al. (2013) segmentation strategy will help the companies to identify the target market where the impact or demand of the herbs product is maximum. Saxena, Ahmad and Gupta (2013) mentioned this identification is crucial, as it will help the company to place the herb product in to the market in such a way that it could able to fulfill the demand of the entire world. The company might have to implement both micro and macro level segmentation strategies in order to have maximum amount of impact of impact in the market.
According to Farooq et al. (2014) five processes can actually influence a company at the time of selecting a target market. Firstly, selection of standards such as operating cost, market size and business goal will have to be defined well by the company in order to select a particular market for the business of the company. Secondly, the companies have to identify the relation between appropriate variables and selection standards. Pala et al. (2016) mentioned that identification of this relation is extremely crucial for the successful internationalization process of herbs product. Thirdly, companies will have to measures the consistency of the market so that it can able to evaluate the kind of challenges they might have to face in future due to the internationalization process. Fourthly, the companies will have to minimize the operating cost of the company so that in can able to generate a good amount of revenue for the company.
The firms also have to select the best mode so that it can actually able to introduce herbs products successfully in the market. Jeelani et al. (2013) mentioned five market entry strategies such as direct exporting, indirect exporting, joint ventures, licensing and direct investment for a successful entry in to the market. Therefore, the companies will have to select evaluate certain factors so that it can utilized the mentioned strategies for the successful introduction of herbs product in to the China and other international markets. Factors like target market condition and characteristics of several market entry mode such as risk degree, investment scale, profit level has to be evaluated by the company so that it can actually utilize the potential world market successfully.
H0: Selection of target market and market segmentation will not help the business expansion purpose of the Himalayan herbs product
H1: Selection of target market and market segmentation will help the business expansion purpose of the Himalayan herbs product
Utilization of the Himalayan herbs for the purpose of the capturing the world herbs market is comparatively a concept. In fact, major portion of the herbs companies actually does not focus too much on the utilization of the Himalayan herbs for the business expansion. However, as mentioned earlier, valley’s of Himalaya has a rich blend of plants that can be utilized for developing medical products. Therefore, it represents a huge opportunity for the companies to develop market all across the world by utilizing these plants of Himalaya. However, as the concept is still new, not many studies have been done on the herbs of the Himalayas. As a result of that not enough studies are there to support the companies in developing strategies that can actually help to expand the businesses all across the world. In fact, no studies have actually evaluated the kind of challenges the company has to face to export the Himalayan herbs product in China or other international countries. Furthermore, no studies have actually evaluated the way by which the herbs product can counter the use of substitute synthetic product in the healthcare sector. The reason for comparatively lesser demand or awareness regarding the herbs plants is also an important issue that needed to evaluate in a much more detailed manner. This will provide an indication the kind of potential market that herbs of Himalaya can have in near future.
3.0 Conclusion:
After examining several studies on the herbs products and the kind of impact it can made in the international market in the literature review, the study have identified several challenges that companies will have to deal with in order to introduce products successfully in the market. In addition, as the study has to deal with lack of information due to limited study on this particular topic, it will have to start from the scratch in order to identify the optimum way to introduce herbs product in to the international market successfully. However, many studies do have highlighted the fact that lot there are huge potential markets for a company that the company can utilize to introduce herbs products. Especially, the study highlighted the fact that major portion of the European market still has not been utilized to the fullest. Hence, the study evaluated the fact that if the companies can able to develop useful strategies for introducing herb products in the China or European market, it will definitely create huge amount of positive impact.
References:
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