Marketing Management, Financial Management Technique, SWOT Analysis

Financial Management Technique

This report is designed with the aim of generating secondary knowledge about different terminologies and concepts related to marketing management. A&A Coffee is the case organization that is selected in this report for ensuring practical relevance of the findings of this report.

Financial Management Technique	Description	Example
Ratio Analysis Save Time On Research and Writing Hire a Pro to Write You a 100% Plagiarism-Free Paper. Get My Paper	Ratio analysis technique is taken into account for conducting evaluation of financial and non-financial performance of a company. For this purpose of different types of ratios are calculated and interpreted on basis financial statements of company.	Example of ratios includes liquidity ratios (such as current ratio, quick ratio), profitability ratios (gross profit margin, net profit margin etc) and efficiency ratios (inventory turnover, receivable turnover ratio, creditor’s turnover ratio etc) (Altman and Hotchkiss, 2010)
Capital Budgeting	Capital budgeting techniques are taken into account for evaluating feasibility of different investment projects (Baker and English, 2011)	Example of capital budgeting techniques includes net present value or NPV, payback period, internal rate of return and profitability index technique
Trend Analysis	This technique is taken into account for identifying trend of market indicators or company’s own performance through evaluating historical data	For example, the trend of sales performance of company is determined to predict future sales performance (Altman and Hotchkiss, 2010).

Question 2

Legislation	Explanation
Anti-discrimination law	Anti-discrimination law of Australia is composed of different legislations and acts like age discrimination act 2004, disability discrimination act 1992, racial discrimination act 1975 and sex discrimination act 1984. Anti-discrimination law of Australia is designed for preventing people or employers from being involved in discriminatory practices on any basis like age, color, sex, disability, race, nationality or other factors (Gaze and Smith, 2016).
Data Protection Law	Data protection law of Australia is also known as The Australian Data Privacy Regulation. This law is designed for providing security to the personal and confidential information of different individuals from misuse and informed usage by any individual or organizational entity. Every company has to ensure confidentiality of privacy of different people.
Minimum Wage Law	Australian Minimum Wage Law is designed for ensuring payment of minimum wage for work performed throughout the nation. Fair work act 2009 is also a major part6 of this law. As per amendment of 1st July 2018 in minimum wage law in Australia, the minimum wage level is set as $18.93 per hour and $719 per week (i.e. 38 hours in a week)
Consumer Protection Law	Consumer protection law of Australia is also known as Competition and Consumer Act 2010. This law is developed for purpose of protection of consumer’s interest in different transactions with business entities. This law governs transaction of goods and services that have price not more than $40,000, vehicles and trailers and personal, household and domestic goods even if they are priced above $40,000 (Bruce, 2010)
Company’s Law	Company’s law of Australia is heavily taken from company law of UK. This law is known as Corporate Act 2001. This law regulates different activities like operations and formations of companies across Australia. It also provides regulations and guidelines for fundraising, takeovers and duties of different officers.
Taxation Law	Taxation law of Australia is also termed as Income Tax Assessment Act 1936. Other tax laws of Australia are fringe benefit tax assessment act 1986 and income tax assessment act 1997. These tax laws are designed for providing guidelines for employers and individuals with regards to their tax liabilities (Woellner et al., 2015).
Privacy Law	The Privacy Act 1988 is a privacy law of Australia. This law is framed and implemented across Australia for purpose of regulating the handling of personal and confidential information of different individuals. All the non-profit organizations and profit making business entities and Australian government agencies are bound by this law.
Cyber security law	Cyber security legislation is also a part of Federal privacy Act 1988 that is also known as The privacy act 1988. According to amendments on 12 March 2014, monetary penalties amounting to A$2.1 million in case of company and A$420,000 can be imposed for serious interference with privacy of individuals (Morris, 2018).
Intellectual property law	Example of intellectual property laws in Australia includes Trade Marks Regulations 1995, Trade Marks Act 1995, Patent Regulation 1991, Patent Act 1990, Design Act 2003, Plant Breeder’s Right Act 1994 and Design Regulations 2004. The intellectual property laws are designed in Australia for registration and protection of intellectual rights and intellectual property of different companies and individuals (Gov AU, 2018).
Anti Fraud Law	Anti-fraud law of Australia is also known as Criminal Code Amendment (Theft, Fraud, Bribery and Related Offences) Act 2000. This law is helpful to understand the acts that are considered as an act of fraud. Maximum penalty for offence under section 134.2 (1) is 10 years imprisonment and for offence under section 135.1 (1, 3 & 5) is 5 years imprisonment (CDPP, 2018).

Question 3

Regulatory Body	Purpose	Guidelines/ Standards/ Codes
ABAC Management Committee	This regulatory body regulates the advertising practices of alcoholic products across Australia	According to guidelines and codes of ABAC, the advertising of alcoholic products should be done in ethical manner.
Australian for Data-Driven Marketing & Advertising (ADMA)	The aim of ADMA is to ensure protection of customer interest and expectations in data driven marketing practices by companies	The codes of practices propounded by ADMA emphasizes on ensuring that business is conducted by companies in good and ethical manner. It sets standards for collection and handling of personal information in different channel of marketing (ADMA, 2018).
Community Broadcasting Association of Australia (CBAA)	CBAA helps the companies to achieve competitive advantage of integrity and diversity	CBAA facilitates the advice on different matters like copy right, content production, broadcast laws, sponsorship, fundraising, RF hazards, broadcasting station management, training etc (CBAA, 2018).
Australian Communications and Media Authority (ACMA)	ACMA is responsible for protection of consumers and other users	ACMA is engaged in activities of governance of online industries, radio-communications, telecommunications and broadcasting. In telecom sector, the ACMA promotes long term interest of end users of telecom services. It also promotes the approach of self-regulation in different industries.

Question 4

Marketing Evaluation Techniques	Description
Value Chain Analysis	Value chain analysis model is highly productive technique that can be used effectively in the market analysis. Value chain analysis model is taken into account for conducting internal analysis of an organization. It is helpful to evaluate competitive resources and capabilities of an organization. Value chain analysis model emphasizes on analysis of different activities of the organization like marketing and sales, outbound logistics, inbound logistics, services, operations, procurement, technological infrastructure, human resources and the firm infrastructure (Reese et al., 2016). On the basis of findings of value chain analysis, the weak areas of business and operations of an organization can be determined. These areas can be improved in order to achieve long term competitive business growth.
SWOT Analysis	SWOT analysis is an important strategic analysis model that is taken into account for evaluating key internal aspects of an organization like strengths and weaknesses. This model is also productive in diagnosis of opportunities and threats that are presented by external market. This way, the SWOT analysis model is helpful to conduct internal as well as external analysis for an organization (Sarsby, 2016). The study of market opportunities and market threats contributes positively in doing market analysis in effective manner.
Product Portfolio Analysis	Product portfolio analysis can be defined as the study of different products and services offered by a company in the market. Product portfolio analysis is helpful to understand, whether products/ services offered by company have potential for growth of company or not. If any limitations are identified, than product portfolio of the company can be redesigned by removing some products and adding other products. This technique is helpful to conduct market analysis according to type of products sold by company in the market (Masterson and Pickton, 2010). The product portfolio analysis is conducted in association with study or latest market demand for the products existing in product portfolio of the company.
Life Cycle Models	Product life cycle model is quite effective to conduct market analysis in effective and efficient manner. According to product life cycle model, there are four stages of product life cycle curve such as introduction, growth, maturity and decline. Through use of product life cycle model, it is evaluated that a product of the company is standing on which stage of the product life cycle curve. If the product is at growth, the company will need minimum investment in marketing activities (Soenen and Olling, 2013). If the product is at maturity stage, the company needs to introduce some modifications in the product for earning consistent sales. In introduction stage, there is need of huge investment in marketing activities.
Competitive Analysis	Competitive analysis is an effective technique that can be used for conducting market analysis for an organization. Under this analysis, the business aspects of company are compared with the competitors. The business of company can be compared with competitors in terms of revenue, product portfolio, investment in marketing activities, price strategy, promotional strategies; number of employees, market share, capital structure and different types of efficiency ratios (Jorgensen and Zaccour, 2012). Competitive analysis technique is helpful to understand actual market position of company and to find ways for improving current position in market.

Identify Strategic Direction

The mission of the company is to become the leading manufacturer and retailer of quality coffee in Australia.

The main purpose of the company is to regain the image of the company in Australian market and combat the threat arise in the NSW outlets to regain its market image by expand into retail business in all over the market by focus on the running cafes and important products that makes the reputation of the company stronger (Hitt, et al., 2012).

The vision of the company is to regain its market share and deliver the quality coffee products to its communities with its principles.

The company provides the quality products to its customers across the markets and remains ethical in its business processes from manufacturing, distribution and retail activities. 

The main strategic direction of the company is to enter into the retail store concept and manufacturing activities to sell the quality products to their customer through their retail stores that reduce the chances of unethical activities in business after recent meeting of the company’s directors. The company’s focus on employees and cafes rather than products and create sustainable process into the operations. The company’s focus on the staff development by provides training support to them and gives safe work environment so that they can effectively contribute into the goals of the company (Hill, et al., 2014).

The main target of the company is to become the leading manufacturer and retailer in the coffee market by retains the market share in the distribution of its A and hardware equipment. Moreover, the target of the company is to retain the market share of sale of its consumables through raw coffee and pods. Similarly, the target of the company is to improve the operational efficiency of the company by developing new stores to provide in house or take away coffee (Hill, 2017). Moreover, the company needs to improve its productivity in manufacturing and logistics process.

SWOT Analysis

Strengths · Strong brand name · Wide network operates 22 retail stores · Specialisation in superior Robust A & Arabica coffee beans which are sourced from world’s top quality coffee producers · Good market share in last 15 years · The company has its own coffee roaster facilities which are equipped with in-house roasting equipment (Doz, 2017).	Weaknesses · Weak branding and promotion policies · Limited segment only producing the raw material and coffee products · Inefficient management · Limited presence only in Australian markets · Lack of transparency and controlling like unethical marketing practices adopt by the company
Opportunities · Growing industry trend i.e. 18% · Growing coffee business trend · Enter into retail segment · Opportunity to enter into different markets ·  Strong product portfolio generates more revenue in home market.	Threats · Rise in competitor share like Roasted Amigos, and Mocha Del Mar achieved 24.2% and 17.4% (Ward, 2012). · Changing government regulations and compliance policies. ·  Changing customer demands and preferences · Threat like unethical practices follows by the company’s management at their stores. · Change in demand and supply of skilled labour availability in the market.

A and A coffee committed to comply all ethical and regulatory policies of the company under The Australian Association of National Advertisers (AANA).It includes AANA Code of Ethics, AANA Native Advertising Principles and AANA Food & Beverages – Advertising & Marketing Communications Code and so on (Lasserre, 2017). 

Ratio Analysis

As per the ethical code of conduct guidelines under AANA, The company responsible sourcing from various raw materials and follow the guidelines prescribed under different policies framed by the legal regulations of the country.

As per the analysis of the overall company operations and position it depicts that the company’s objective is to be the leading retailer and manufacturer of the quality coffee products in Australia. It is also analysed that company analysed the internal and external environment and wants to improve the operational efficiency of the company through increase the production of coffee and raw materials through in house process. Moreover, the company’s objective is to rebuild the image of the business by introducing the new coffee beans into the stores to combat the theat. Moreover, the main focus of the company is to run the coffee cafe’s and not coffee products.teh company specialises in selling superior coffee namely RobustA and Arabica coffee brand source from the top international coffee producers like Columbia, Kenya and Indonesia (Stead & Stead, 2014). Moreover, the company’s strong product portfolio and past recent market growth supports the strategic direction to the company to remain competitive in the long run. Due to its strong growth in the market the company opens the retail coffee stores that provide the take away brewed coffee for the consumers. Additionally, the company also provides the effective training and development programs for their employees so that they can remain engage in their tasks. Similarly, effective marketing and promotional activities helps the company in its growth whatever initiative taken by the company.

As per the overall past recent performance of the company it depicts that the company’s products and services are good and performed well in the market. But due to some unethical activities found by the company in its one of the NSW store takes the important decision to enter into the in house retail segment and leading manufacturer in Australia (Goetsch, et al., 2014). The past performance of the industry and coffee market is good in different areas but due to high competition the company change its strategic direction and goals that helps the company remain sustainable in the long run.

As per the overall analysis of the market there are lot of opportunities for the company to enter into the home markets and different markets with new retail concept. The previous data of the industry and its different segments are strong and growing such as 15% and 41% in in-store operations. So the company has the opportunity to enter into this segment (Morden, 2016).

Capital Budgeting

The company can earn the huge profits by exploring this opportunity in the long run due to strong demand in the market for quality coffee products and the company already have the good product line of the coffee raw materials that easily attracts the target market.

The company can position its product to serve the every individual coffee drinker in the market. It is the healthy and quality coffee producers in the country that gives the unique taste and competitive price that attracts the maximum adults and youngsters of the country. Good quality and attractive prices available at various stores is the main positioning strategy of the company (Harrison and John, 2013).

Arabica Coffee beans and Espresso Coffee Machine are the two products of A&A Coffee Company that are selected for conducting SWOT analysis. SWOT Analysis of Arabica beans of A&A Coffee Company is as below:

Strengths: Strong brand name of company Unique taste of the product Stronger market share as compared to similar products of other companies	Weaknesses: Lack of control over dynamic nature of customer taste High price of product Easy availability of substitute products (i.e. tea)
Opportunities: Opportunity of designing and launching same product in multiple new flavors	Threats: Increasing competition from local and foreign brands in similar products Threat of increase in GST that may result in decline in profitability from product if price is not changed

SWOT analysis of Espresso Coffee Machine of A&A Coffee Company is as below:

Strengths: High quality of machine in terms of technology High level of operational efficiency Low level of energy consumption by the machine	Weaknesses: Lack of control over competitor’s strategies High price of the machine and accessories
Opportunities: To increase investment in marketing and promotional strategies Ro launch referral schemes for customers for increasing the sales of product To start selling products through dealership strategy	Threats: Increase in the level of competition from local and multinational companies Risk of increase in competition

Table summarizing revenue and cost sheet for feasibility analysis for first product (i.e. Arabica Coffee beans):

Arabica Coffee Beans
Particulars	Year 1	Year 2	Year 3
Revenue	16000000	18000000	21000000
Less: Business Overheads
Wages of labor	100000	150000	210000
Factory Rent	2000	2000	2000
Electricity	45000	50000	70000
Telephonic expenses	12000	13000	14000
Cost of product packaging	16000	18000	22000
Advertising cost	40000	50000	80000
Total Expenses	215000	283000	398000
Net Profit	15785000	17717000	20602000

Table summarizing revenue and cost sheet for feasibility analysis for second product (i.e. Espresso Coffee Machine):

Espresso Coffee Machine
Particulars	Year 1	Year 2	Year 3
Revenue	10000000	8000000	7500000
Less: Business Overheads
Wages of labor	100000	150000	210000
Factory Rent	2000	2000	2000
Electricity	45000	50000	70000
Telephonic expenses	12000	13000	14000
Cost of product packaging	16000	18000	22000
Advertising cost	40000	50000	80000
Total Expenses	215000	283000	398000
Net Profit	9785000	7717000	7102000

From the analysis of different attributes and aspects of the two selected products, it is observed that Arabica Coffee beans is the most suitable product for A&A Coffee Company. It is so because the company has strong control and market position in the sale of this product. In contrast to this, the company has faced significant decline in the sales of Espresso Coffee Machine. The three strengths of A&A Coffee Company are sound financial position, sound brand image and unique taste of the products. The three weaknesses of A&A Coffee Company are lack of control over competitor’s move/ strategy, dynamic nature of customer taste and high level of price strategy. It can be recommended to company to focus on special offers for attracting customers like cash back offers, seasonal and limited period discount offers. It can also be an effective strategy for company to investment in research and development activities for knowledge of latest market trends. The products should be customized in a way so that latest market needs can be fulfilled by them. This all would positively influence the customer perception and satisfaction in market.

Following is the long range strategic objective for A&A Coffee Company for three years:

• To achieve revenue generation of 21 million Australian Dollars by end of three business year
• To increase the market share of company by 10% by end of three business years

Following is the short range strategic objective for A&A Coffee Company for time period of one year:

• To generate the sales of 16 million Australian Dollars by end of current business year
• To increase investment in marketing and promotional activities by 10% in current business year
• To design and launch coffee products in multiple flavors for availability of better choice to customers 

Trend Analysis

Main objective planned for the company is to achieve a sale of 21 million Australian dollars by end of three consecutive years. It is planned for the company to increase its market share by 10% by end of three business years. The current sales performance of company is approximately 15 million Australian dollars. From the analysis of revenue data for coffee product, a positive revenue growth trend has been seen in the market. It means there is opportunity for company to increase its revenue performance. It is a market opportunity for company to invest in marketing and promotional strategies for achievement of competitive sales growth. In addition to this, the company should also focus on designing and launching its coffee products with multiple flavors for attraction of customers. The biggest market threat for company is increasing competition. The strategic direction of company is towards business growth by innovation and competitive offerings. Strengths of company are brand reputation, unique taste and sound financial position. Weaknesses of company are high price of products and lack of control over dynamic nature of customer taste. It is highly important for the management of company to ensure strict compliance of their business with different legal (like compliance with data protection law, company law, taxation law, privacy law etc) and ethical requirements in business.

Following table summarizes the risk management plan for company:

Risk Factor	Likelihood of Occurrence (out of 5)	Impact	Mitigation Plan
Risk of time overrun issue	4	Impact on timely achievement of set goals	Development of WBS and Gantt chart and strict follow-up
Risk of cost overrun issue	3	Delay in different planned activities to achieve set business goals	Timely review of project progress and to make comparison of actual cost and planned benchmarks
Conflict among team members	2	May create hurdle in proper functioning of overall activities	Timely diagnosing and mitigation of conflicts among team members
Technical issue	2	May cause huge data loss	Timely maintenance of systems and use of highly advance anti-virus software

(a) Marketing Objectives

Long Range Objectives:

• To achieve revenue generation of 21 million Australian Dollars by end of three business year
• To increase the market share of company by 10% by end of three business years

Short Range Objectives:

• To generate the sales of 16 million Australian Dollars by end of current business year
• To increase investment in marketing and promotional activities by 10% in current business year
• To design and launch coffee products in multiple flavors for availability of better choice to customers

(b) Rational of Objectives

The designed marketing objectives are justified and have proper rational. For example, the objectives are designed after the analysis of current company situation and market trends for selected products. In addition to this, the stakeholders have also agreed with the rational of designed long range and short range marketing objectives.

(c) Risk Management Strategy

Following table summarizes risk management strategy for the A&A Coffee Company: 

Conclusion 

As per the analysis of the overall report it is concluded that A&A adopt the relevant marketing strategies and improvements in its process according to the current situation of the company that help the company to achieve its strategic goals in the long run. 

References

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