Feasibility Study For The Gluten Free Food Co. To Enter The Chinese Market

The Gluten Free Food Co.

The increasing awareness of the customers regarding the nature or the kind of food products that they consume has necessitated a change within the food industry (Viitanen and Kingston 2014). Yuan et al. (2013) are of the viewpoint that unlike the customers of the earlier times, the modern customers are not only aware about the qualities of each of the food products that they consume but at the same time the adverse effects of the excessive consumption of these products. The change in the buying behavior of the customers can be seen as the adverse effect of the increasing number of diseases and health problems that the majority of the people are subjected to in the present times (Viitanen and Kingston 2014). This has compelled the various enterprises related to the food industry to reconsider not only the products offered by them to the customers but also to change the very nature of these products itself (Yuan et al. 2013). In this regard, mention needs to be made of the Gluten free products which are being offered by the organisations like “The Gluten Free Food Co.” and others. This report will discuss about the feasibility of the entry of the “The Gluten Free Food Co.” into the business market of China and also the strategies or measures that they need to follow.

 The Gluten Free Food Co. is a well established organisation in the nation of Australia and is reputed for providing various kinds of gluten free food products to the customers of the nation (Gluten Free Food Co. 2018). This is important because of the fact that gluten causes Celiac disease and other gluten related disorders (Ghalichi et al. 2016). In this regard, it can be said that the primary motive of the organisation is not only to mitigate the adverse effects of the use of gluten related products by offering gluten products to the customers but also to improve the health standards of the people as well (Gluten Free Food Co. 2018). The high demand for the food products offered by the organisation can also be explained on the basis of the fact that the people are increasingly becoming prone to various kinds of diseases and health problems like “celiac disease, gluten ataxia, wheat allergy, non-celiac gluten sensitivity and dermatitis herpetiformis” and others (Lamacchia et al. 2014). Furthermore, recent researches have suggested that the majority of these health problems are related to the intake of food items which contained toxic elements (Ghalichi et al. 2016). Moreover, the high quality of the products or food items offered by the company like Gourmet Cookie Collection, vinegar and others have been much appreciated by the customers (Gluten Free Food Co. 2018). The company holds more than 24% of the market share of the gluten-free food industry of the nation of Australia (Australia.gov.au 2018). In addition to this, it is seen that the organisation follows the e-commerce model of business and the majority of the product sale and other activities are performed over the tool of internet itself (Gluten Free Food Co. 2018). In this context, it can be said that the tech-savvy population of China will be a suitable one for the business operations of the organisation under discussion here.

Strength	· The focus of the company on the health consciousness of the people and also the problems faced by the people (Gluten Free Food Co. 2018). · Effective leadership provided by Monica Topliss, who once herself suffered from the celiac disease (Gluten Free Food Co. 2018) Save Time On Research and Writing Hire a Pro to Write You a 100% Plagiarism-Free Paper. Get My Paper · Focus on quality rather than on the entity of quantity · Effective utilisation of the e-commerce business model
Weakness	· Limited product range and also the lack of variety in the products offered by the company · Limited brand image of the products offered by the company deters the customers from opting for them (Buie 2013).
Opportunity	· Starting a new product range which will focus on organic food products and not just on the gluten free products. · Use of the “omni-channel business strategy” which will enable the organization to use both the e-commerce model and the “brick and mortar” model of business (Liu, Pieniak and Verbeke 2013).
Threat	· The food market has already been monopolized by the organic food providing organizations and the other organizations which provide gluten free products to the customers. · Lack of awareness of the customers regarding the gluten free products and its benefits.

SWOT Analysis

The organization under discussion here can offer the same kind of gluten free products to the customers in the nation of China that it has been used to offering in Australia. However, at the same time, the organization can benefit in a substantial manner from widening its product range and incorporating diverse kinds of organic food products would also help the cause of the company in a substantial manner (Doz 2017). The population of China is not only tech-savvy but at the same time very conscious regarding their health (Gov.cn 2018). Thus, it is expected that the organization would benefit in a substantial by focusing on the tech-savvy people who belong to the age bracket of 30-60 years.

Political	· The nation is being controlled by the Communist Party of China (Gov.cn 2018). · The Communist Party promotes only the state sponsored organizations and the private ones receive scant attention (Gov.cn 2018). · The national government takes very little initiatives for the promotion of trade and commerce Threat: The political condition of the nation actually acts as a threat for the company since a stable and congenial political environment is one of the prerequisites of the business world.
Economic	· China is one of the largest emerging economies of the world (Gov.cn 2018) · The global economic recession which adversely affected the majority of the nations had very little effect on the national economy of the nation. Opportunity: The stable as well as booming economy of the nation actually acts an opportunity for the company since the company can utilize this stable economy of the nation for fostering its growth.
Social	· The Chinese people are very conscious about their health and also the kind of food products that they consume (Gov.cn 2018) · Western food products are extremely popular among the people of the nation Opportunity: This actually acts an opportunity for the company since it can utilize this social trend of the nation for the process of its growth in the nation.
Technological	· China in the recent times has emerged as one of the most technologically advanced nations of the world (Yuan et al. 2013). · The nation actively takes the help of this technological advancement for the manufacture of superior quality food products. Opportunity: The company can utilize this technological landscape of the nation for the manufacture of the food products offered by them to the customers.
Legal	· The private organizations of the nation are required to follow the mandates of the Communist Party of China (Yuan et al. 2013). · These legislations often favor the state sponsored organizations and put the private organizations at a disadvantage (Yuan et al. 2013). Threat: This actually acts as a threat for the company since it limits the growth prospects of the company.
Environmental	· The nation has stringent environmental regulations that the business enterprises are required to abide by. · Stringent penalties are being imposed on the enterprises which fail to take these regulations into effective consideration. Threat: This actually acts as a threat for the company since incase of failure to abide by these regulations the company can even face liquidation.

Industry Rivalry	The food market of China has already been monopolized by organizations which not only offer better quality organic but also gluten-free food products to the customers in comparison to The Gluten Free Food Co (Gummesson 2017). Thus, it is expected that the company will find it difficult to establish itself in the business market of China.
Bargaining Power of Buyers	The number of options which are available to the customers is very high because of the large number of companies which are operational in the business market of China (Scarborough 2016). Furthermore, the cost to switch over from one company to another is very low. Thus, it can be said that the buyers enjoy a very high bargaining power.
Bargaining Power of Suppliers	The Gluten Free Food Co. for the process of the procurement of the raw materials that are needed for the manufacture of the products offered by them to the customers takes the help of multiple supplier system. This not only reduces the bargaining power of the suppliers which are associated with the company but at the same time ensure that the raw materials are delivered on time (Moore et al. 2015).
Threat from New Entrants	The Gluten Free Food Co. has established themselves as one of the largest producers of gluten-free food products and at the same time enjoys a positive brand image. Thus, it can be said that the company faces very low level of threat from the new entrants into the business market.
Threat from Substitutes	The company faces a high level of threat from the various other companies which are operational in the business market of China. These companies not only offer better quality products but also the price of these products are lower than the ones charged by The Gluten Free Food Co.

In the contemporary business world, various market entry modes are available to the business enterprises willing to enter into the business markets of the other host nations like merger and acquisition, collaboration or joint venture and others (Miquel-Romero, Caplliure-Giner and Adame-Sánchez 2014). The Gluten Free Food Co. can take the help of the market entry mode of collaboration for the process of its entry into the business market of China. Viitanen and Kingston (2014) are of the viewpoint that the effective utilisation not only enables the organisations involved in the process of collaboration to share the profits made by them but at the same time to shoulder the burden of loss together. Thus, the organisation taking the help of this particular mode of entry can enter into collaboration with some already established organisation which offers gluten-free products to the customers. This will not only help the company to use the customer base of the company with which it is entering into collaboration with but also to utilize the other resources of the concerned company for the process of its business (Liu, Pieniak and Verbeke 2013).

Product	The company offers a wide range of gluten-free products to the customers of Australia. The company for the process of their business operations can even take the help of the product strategies like product differentiation, product adaptation, standardization and others so as to provide quality food products to the customers (Doz 2017). This will not only help the company to satisfy the customers and thereby earn their loyalty and also the opportunity to earn a higher amount of revenue (Gummesson 2017).
Price	The company can follow the pricing strategy of cost leadership. The effective utilization of this strategy will enable the organization to offer standard quality food products to the customers of China and that too at comparatively lower prices (Scarborough 2016).
Place	The company can initially establish their business in some of the major cities of the nation of China like Beijing and others. The company after establishing a stable customer base and also securing a stable source of revenue can move on to the other remote cities and rural areas of the nation.
Promotion	The citizens of China are highly tech-savvy and thereby the modern forms of promotion would help the company in a substantial manner. In this regard, it can be said that the company would gain in a substantial manner through the effective utilization of digital marketing as well as promotional strategies.

The major problem that the company is likely to face for the process of their business operations in the nation of China is the high level of competition that the company would not only face from the other organizations which offer gluten-free food items to the customers but from also the ones which offer organic food products (Yuan et al. 2013). This problem can be mitigated in an effective manner through the implementation of the above provided marketing mix. The success of these strategies can be measured not only on the basis of the net annual revenue generated by the company in China but also the increase in the customer base of the company. The future performance can be controlled through maintaining the quality of the food items offered by them to the customers in a sacrosanct manner.

Conclusion

To conclude, the food industry has undergone a substantial amount of transformation in the recent times in synchronicity with the changing needs and also the requirements of the customers. The net result of this is the fact that the individuals of the present times are focusing more on the various kinds of organic and gluten-free products. It is pertinent to note that these food manufacturing organizations in order to enhance their business prospects often undertake the process of internationalization. However, for the effective management of the diverse aspects of their business in the business markets of the host nations, these organizations needs to take into effective consideration the process of marketing and also the requirements of the business environment of the host nation. In addition to these, the mode of entry into the business market is also important and the prospects of the concerned company in the business market of the host nation to a large extent depend on its mode of entry strategy.

The organization for the process of the improvement of their business operations can take the help of several measures. For example, the company in order to promote the food products offered by them to the customers and also to connect with them in an effective manner can take the help of the Chinese superstars for the promotion of the products offered by them to the customers. This particular goal can be attained by the company in less than one month. Another measure that the company can follow is to take the help of various kinds of corporate social responsibility events for the enhancement of the brand image of their organization. This will boost the sale of the products offered by the company and the effective attainment of this goal would take atleast six months of time frame.

References

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Ghalichi, F., Ghaemmaghami, J., Malek, A. and Ostadrahimi, A., 2016. Effect of gluten free diet on gastrointestinal and behavioral indices for children with autism spectrum disorders: a randomized clinical trial. World Journal of Pediatrics, 12(4), pp.436-442.

Gluten Free Food Co. 2018. Products Archive – Gluten Free Food Co. [online] Available at: https://glutenfreefoodco.com/shop/ [Accessed on 18 October 2018]

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