Business strategy refers that the company grow in the market by increasing the sales of the product. Product market expansion contains two factors and these are product and the market. The market can be either a current or a new market to expand the product at the large number of consumers. The company requires to analyses the market environment before developing the strategies to expand the product in the new market. This report is mainly focuses on analyses of the market to expand the product. In this report, Tasmanian Mountain Waters ® Natural Spring Water has been taken into consideration to increase the sale by expanding the business into UK market.
In the beginning of the report, the discussion is made about the product of Tasmanian Mountain Waters ® Natural Spring Water and economy of UK. After that analyses has been done of UK market as per the factors such as economic, legal, technological, social and environmental factors. Recommendation will be discussed in the market in the end of the report.
Tasmanian Mountain Waters ® Natural Spring Water is well balance of sources of water which includes the natural calcium, magnesium, Phosphorus and the other materials. The product contains the best possible pH 7.6-7.8 levels. The company offers the 5 litres and 10 litre of water bottle to the consumers. The company uses the boxes to store the product for long time. The product is suitable for long term storage as the expected 5 years of life. The product is also convenient for the bench-top dispensing at the time of uses of kitchen.
It has been seen that the 10 0r 5 litres cask is more suitable for long term storage but best for 2 year after the date of manufacturing. The product has excellence quality of product because it filtered through two stages of micro filtration. The company uses the state-of-the-art micro filtration technology and sterilised it by using the ozone sterilisation method (Mintel, 2018). After the process, the company filled into the sterile metallised polyester laminate bags and store in clean rooms where the product is suitable to stores for long time. The bags are stores in the clean room but the company package the water in boxes for shipments to export or import. The quality of product is clean, pure, natural and mineral water (Tasmanian Mountain Waters ® Natural Spring Water, 2018).
It has been seen that the style and features affecting the use of reusable waters bottle in the UK market. The 58% of companies use a reusable water bottle if they founded the hygienic product. The sale of plain water in retail packs increased with the rate of 8% in 2017. According to the reports, the consumption of water rose was 7% in the year of 2017 which is nearly the consumption of 4000 million litres with the retail value of £3.1bn. But the retail value of the sales of plain bottles water coolers is increased with the rate of 8% in the year of 2017 which means the 3100 million litres and volumes consumption.
The volume of water is grown with the rate of 2% to 310 million litres. It has been founded that the bottled water industry mainly focuses on the health consciousness due to healthy hydration habits of consumers. It is predicted that the industry gain the revenue with the annual rate of 6.9% over the five years through 2017-18. The amount is reached at the £1.1 billion and the revenue is rise at the rate of 4.5% (Full Fact, 2018).
Economic/Financial environment analysis
It has been seen that the economy of the country is fluctuating with the different rates which helps the company to achieve success. As the economy is fluctuated the companies also face the issue of failing in the market. The market of UK is well stable for the company to expand the business of Tasmanian Mountain Waters ® Natural Spring Water in the market in the terms of the size and money. But at the time of recession, it is difficult to survive in the market due to increasing the cost of production. It is founded that the high quality of water is required has high scale in market of UK rather than the necessity requirement. The growth of GDP of the UK nation has a positive impact on the growth of Tasmanian Mountain Waters ® Natural Spring Water and vice versa (Staykova, & Damsgaard, 2015).
It has been seen that the rate of interest of loan is low which is beneficial for the company. The company has the opportunity to taken loan in the low rate of interest to invest in the new technology to produce the product. The cost of investment is reduces due to which the company produce the product in the low cost. It has been seen that the purchasing power of the consumers is high due to low rate of interest. This factor reflects that the consumers can easily buy the products as per the requirements. There is a chance of increasing the sale of the Tasmanian Mountain Waters ® Natural Spring Water is high in the market of UK (PNE, 2017).
The current situation of UK is not suitable for the Tasmanian Mountain Waters ® Natural Spring Water due to recession period. It is estimated that the country will quickly recover soon and the demand of customer is rises in the future. The customer starts to invest in eating restaurant, high streets and car stoppings. The company has to borrowed the money to invest in research and development departments so that it have the information regarding the market and after that it has to invest in the marketing to promote the products.
It is estimated that there 19% of people consume bottles water in the daily routines in the market of UK on the daily basis. It has been seen that there are 7.7 billion plastic water bottles consumed in the UK per year. The industry earned high revenue with the amount of £2.4 billion per year (Renzetti, 2015).
(Source: Soft Drinks, 2018).
The 76% of UK population consume the water bottles in the daily routine activity. As per the high scale and high purchasing power of consumers’ states that the Tasmanian Mountain Waters to launch Natural Spring Water has the high opportunity to enter the market (Soft Drinks, 2018).
Political/Legal
Political
The government plays the important role in xpanding the business to other country due to rules and regulation. The government makes the laws as per the situation of the country or to provide the benefits to the people. Government made the laws related to services of the company so that the consumer gets the high quality of services. Penalties law has been implemented on the low quality of product. It has been seen that the Tasmanian Mountain Waters earns the more profit (Morandin, Long, & Kremen, 2016).
The government of UK provides the benefits to the non-alcoholic businesses at the time of entering into the market. The rules and regulation of the government is change with the passage of time which may affects the business and their deals. The company can uses the strategies to gain the market share such as new competitive product, and prices strategy. These strategies are also affected by the rules and regulation of the government. The tax rate are also modified as pet the tax laws and environmental laws which affects the deal of business. The tax rate and prices rate affects the prices of Tasmanian Mountain Waters and environmental laws affect the Tasmanian Mountain Waters to launch the Natural Spring Water in the UK market (Miller, & Weinberg, 2017).
Legal
It has been seen that the water bottle contains the chemicals which affects the consumers. The government of UK made the regulation related to the storage time period. As per the regulation, the companies cannot deliver the product before finishing it and analysing their quality. The water industry act of 1991is developed from the EU drinking water directive and the laws governs the supply of drinking water in the market of UK. The rules and regulation are analysed by the World Health Organisation (Weinthal, Vengosh, & Neville, 2017).
In the UK bottle market, the drinking waters regulation is necessary to follow in which it is compulsory to maintain the quality of waters and its packaging. The packaging of water should be chemical free and beneficial for the consumers. It is essential to register the company under the Food Standard Agency so that the local authority evaluates the quality of water (Felipe-Sotelo, Henshall-Bell, Evans, & Read, 2015).
Social/ Cultural
Nowadays, the consumers are getting conscious about their health. The people start dieting and eat healthy food to stay healthy. The alcohol drinks are reduces and the market share of the energy drink and waters is increases day by day which are an positive factor for the company. It has been evaluated that the demand of consumers is shifted towards the less sugar products and healthy water bottles to stay healthy. Especially the age group of customer between the 37 to 55 more consume the water due to good eating habits. This factor is favourable for the Tasmanian Mountain Waters to enter into the market due to high demand of the consumers towards the healthy drinks (Financial Times, 2018).
Culture of the society is the other factor which affects the environment of the company. The attitudes, belief shared by the company with the consumer’s plays a vital role in increasing the sale of the product. The marketing message use by the Tasmanian Mountain Waters specified the attitude of the company towards the society.
Technological and Environment Analysis
The company use the technology to promote the products such as internet, television advertisement and many others. In the market of UK, there are many technologies use by water bottle companies such as packaging, quality management and many others. Although, the Tasmanian Mountain Waters also use the packaging machines and filters machines. But it is necessary for the company to analyses the quality by using the quality management tool. The company has an advantage to adopt the new technologies to improve the quality of the product.
The new technologies of marketing are also beneficial for the company to attract the large number of consumers (Miller,& Weinberg, 2017). There are many packaging technologies adopt by the UK market such as cans and small bottles which is suitable for the consumers. The manufacturing machines of these technologies are also a favorable factor for the company to enter the market of UK (Financial Times, 2018).
The company has the responsibility to take care of the environment at the time of expanding the business. The company has to adopt the different packaging style which is not harmful for the environment. The concern of environment is expanded in the different nation across the world which states the responsibilities of the company towards the environment. In the market of UK, environmental act is followed by the company and the natural products are promoted as compare to the others. It is beneficial factor for the Tasmanian Mountain Waters to enter the market of UK with its Natural Spring Water (Wakeel, Chen, Hayat, Alsaedi, & Ahmad, 2016).
Recommendation
Competitive strategy
The company has to improve the strategies if it survives for long time in the very competitive environment. It is very competitive market because the companies can easily enter the market without less financial capital (Madsen, & Walker, 2015). Apart from the good strategies, the company has to know about the market in which its aims to expand the business in new markets with the modified product. The company has to attract the large number of consumers by promoting the product in the market. Cost leadership, product developments and the many other competitive strategies that help the company to gain the competitive advantage in the market (Darroch, Miles, & Jardine, 2015).
Mode of entry
The existing companies have the high goodwill value in the market which would be a threat for the company. Dasani, Nestle Waters, Aquafina and many other companies which have high goodwill value in the market. It is difficult for the company to build their relationship with the customer (Aquafina, 2018). It is recommended that the company has to enter the market with the high reputation so that the large number of customer attracts towards the product. The company has to enter the market with Joint venture method.
The company has to come under the contract with the famous company so that it can also attract the customer and increase the value of goodwill. It has been seen that the Aquafina is the leading company in the market of UK. The company has to enter the market with the Aquafina so that the rules and regulation of the government is also implemented in an appropriate manner and earn the high goodwill value (Killing, 2017).
Research and development: Threats and opportunity about UK market
The economic condition of the country is not stable at the moment but it is estimated that it will be improved very soon. The company can faces the issue of less selling of product due to low purchasing power of consumers at the moment. The high competition is the factor which affects the business. The tax rate and legal factors of the country is a threat for the company due to their fluctuating rate. The company has to take care about these threats and get the advantage of their opportunities to reduce them and earns the high revenue (Wagner III, & Hollenbeck, 2014).
From the above analysis, it is observed that the company has the opportunity to enter the market. The advance technologies, consumers demand, environmental rules and regulation are the favourable factors which helps the company to achieve the success in the UK market. The company can learn the new technologies related to the manufacturing of product which helps to reduce the cost of production.
The company can earn the high revenue by reducing the cost of production or improving the quality of water. Cultural and environmental value of the country is also an opportunity for the company because the government of UK provide the special benefits to those companies who deliver the natural products. The company introduce the natural spring water thus; it can take the advantage of the government services.
The interest rate is low in the UK market which is another beneficial factor for the company. The company has to borrow the money to invest in the research and development department to analyse the market situation to achieve the success.
Conclusion
From the above analysis, it has been concluded that the Tasmanian Mountain Waters has to expand the business in the UK market. Political, Economic, social, legal, environmental and technological factors has been analysed in this report to analyse the threats and opportunity for the product to enter the UK market. The company has the many advantages to enter the market such as high technology, favourable rules and regulation, government facilities and many others.
However, the economic condition of the country is not stable but after a certain period of time the economic condition becomes stable. As per the analysis, it is recommended that the company has to invest in the research and development department to analyse the market situation. The company has to enter the market with the Aquafina Company to attract the large number of consumer towards their product. The Natural Spring Water product of Tasmanian Mountain Waters will achieve success in the near future in the market of UK.
References
Aquafina. (2018). Our products.
Darroch, J., Miles, M., & Jardine, A. (2015). Market creation: a path to sustainable competitive advantage. In Proceedings of the 2008 Academy of Marketing Science (AMS) Annual Conference (pp. 331-331). Springer, Cham.
Felipe-Sotelo, M., Henshall-Bell, E. R., Evans, N. D. M., & Read, D. (2015). Comparison of the chemical composition of British and Continental European bottled waters by multivariate analysis. Journal of Food Composition and Analysis, 39, 33-42.
Financial Times. (2018). How millennials’ taste for ‘authenticity’ is disrupting powerful food brands.
Financial Times. (2018). UK digital technology sector outpacing wider economy.
Full Fact. (2018). UK economic growth within the G7.
Killing, J. P. (2017). How to make a global joint venture work. In International Business (pp. 321-328). Routledge.
Madsen, T. L., & Walker, G. (2015). Modern competitive strategy. McGraw Hill.
Miller, N. H., & Weinberg, M. C. (2017). Understanding the price effects of the MillerCoors joint venture. Econometrica, 85(6), 1763-1791.
Mintel. (2018). UK Bottled Water market report.
Morandin, L. A., Long, R. F., & Kremen, C. (2016). Pest control and pollination cost–benefit analysis of hedgerow restoration in a simplified agricultural landscape. Journal of economic entomology, 109(3), 1020-1027.
Packaging News. (2018). Bottled water sales rise, according to report.
PNE.(2017). UK bottled water usage rises 10% amid tap water contamination fears.
Renzetti, S. (2015). Non-household water demand: the industrial and commercial sectors. In Understanding and Managing Urban Water in Transition (pp. 297-310). Springer, Dordrecht.
Soft Drinks. (2018). Bottled Water.
Staykova, K. S., & Damsgaard, J. (2015). The race to dominate the mobile payments platform: Entry and expansion strategies. Electronic Commerce Research and Applications, 14(5), 319-330.
Tasmanian Mountain Waters ® Natural Spring Water. (2018). Product.
Wagner III, J. A., & Hollenbeck, J. R. (2014). Organizational behavior: Securing competitive advantage. Routledge.
Wakeel, M., Chen, B., Hayat, T., Alsaedi, A., & Ahmad, B. (2016). Energy consumption for water use cycles in different countries: A review. Applied energy, 178, 868-885.
Weinthal, E., Vengosh, A., & Neville, K. J. (2017). The nexus of energy and water quality. In The Oxford Handbook of Water Politics and Policy. United Kingdom: Routledge.
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