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Distribution in Europe & Asia
 

Distribution in Europe & Asia

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Entering Foreign Markets: Rewards vs. Risks /Complexity ...

Entering Foreign Markets: Rewards vs. Risks /Complexity

International trade is a risky yet extremely rewarding business. Expanding globally offers companies huge growth opportunities. However to ensure success, companies need to adjust their consumer and customer proposition to the needs and dynamics of the market they are expanding into. During this process, companies learn that there are no substitutes for local intelligence, contact networks and field experience

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    Distribution in Europe & Asia Distribution in Europe & Asia Presentation Transcript

    • Entering Foreign Markets: Rewards vs. Risks / Complexity  Organizations entering foreign markets can find it expensive, risky and time consuming  The ability to learn how a country operates before setting up operations is essential for a successful market entry – Understanding the local laws and regulations, the differences in business culture and consumer behavior is typically time consuming and expensive – Identifying and selecting reliable business partners in foreign markets is complicated and … many times risky 0  Euro GDP 2012: 17.6 trillion (16.2 trillion US)  No custom duties between 31 Euro countries – 27 countries in EU (of which 17 in Euro Zone)  There are over 160 Retail & Department Store Chains in EU EU market is the largest market in the world Asian markets are the fastest growing markets  Asian GDP PPP in 2012 : 21.5 trillion (7,6% growth)  Wine consumption in China in 2012 :18.4 Mhl (third largest wine market in the world after EU and US)  Emerging market with little brand awareness / consolidation
    • Expanding your business into Europe & Asia Connecting your products with top customers in Europe & Asia Minimizing market entry risks & maximizing profits Facilitating customer acquisition & management August, 2013 Y O U R M A R K E T E N T R Y E X P E R T Global Retail Consulting
    • Going Overseas with us  GRC provides market entry strategy and execution support, helping companies enter the European and Asian markets  We help you throughout all steps of an international expansion – from initial opportunity sizing through opening your own branch. Our services allow you to contact all major local customers for your product category and give you the opportunity to sell them your products  Our highly professional staff comes for various areas of expertise from management consulting and finance to retail, international trading and sales.  As you start developing your expansion strategy, GRC offers holistic services that combine all aspects of business development, retail insights, marketing, legal, tax, administration, Business Process Outsourcing, human resources, and business location identification 2 Go to Market Strategy 1 Customer Sell-in Support Interim Account Management Branch Development Support 2 3 4
    • Our advantage : Speed, Efficiency and Control Speed When entering foreign markets the trial and error approach is time consuming and risky We will rapidly size the opportunity, select the right distribution channels, identify all the decision factors and introduce your product to the right buyers in a professional custom-made manner Efficiency Markets are diverse and complex. We will guide you through all the steps of the market entry from evaluating the market potential and connecting with customers to opening your own branch Control Maintaining control over your overseas operations during the expansion is complicated. When working with us you are always in control. You can redirect resources to different markets, delay the expansion, withdraw from a particular market and do all these with minimum costs 3
    • GRC provides four services that will take you from evaluating a new market to owning a subsidiary  International readiness  Market, competitive dynamic  Barriers to entry  Product fit & profitability 4 Decision point – Go / No-go  Channel definition  Customer segmentation  Customer identification  Customer meetings set up  Negotiation support  Customer agreement design  Product import management  Customer management  Subsidiary viability analysis  Location identification  Legal compliance  Organization set up - hiring New Market Opportunity Sizing 1 Go to Market Strategy Customer Sell-in Support Interim Account Management Branch Development Support 2 3 4 Global Retail Consulting Services
    • New Market Opportunity Sizing: we will estimate the potential revenues and profitability from expanding in each country 5 1 International Readiness Market Size & Competitive Dynamic Barriers to Entry Product Fit & Projected Results  Launching a product in a foreign market requires understanding the opportunity  This will allow you to prioritize across various geographies or company initiatives  The output we will provide will allow to you to – Quantify the size of prize – Understand associated risks – Isolate the key challenges for the market analyzed  Timing: 2 - 4 weeks Main Deliverables  Market size and growth trend  Main players, market share & historical growth, product and price positioning  Consumer / customer profiles and needs  Regulatory environment  Competitive response to prior entries  Minimum investment required  Product attributes vs. competition, insights for product / pricing adjustments  Estimated share & revenues by price tiers  High level cost structure Considerations & Timing  Product & market position in US  Product differentiation and pricing structure  International experience & capabilities
    • Go to Market Strategy: we will lay out a go-to market model that will help you build your product distribution 6 1 Channel Definition Customer Segmentation Customer Identification  The knowledge you have about a market will directly influence your chance to succeed  Based on our experience and market data we will lay out the current distribution landscape  We will segment and prioritize customers where your product needs to be distributed if you decide to enter the market  Timing: 2 – 4 weeks Main Deliverables  Segmentation across channels and identification of success drivers  Prioritization based on size of opportunity and cost to serve  Top customers based on size of opportunity  Main buying contacts for each customer  Guidelines on approach for sell-in Considerations & Timing  Channel structure, market share & growth  Top customers by channel  Product differences & requirements by channel
    • At the end of this phase you will decide whether to go forward and start the actual sell in process 7 Euro Retail Consulting Services Alignment on whether to  Continue the market entry process for the analyzed country  Evaluate another geography  Suspend (postpone) international expansion New Market Opportunity Sizing 1 Go to Market Strategy Customer Sell-in Support Interim Account Management Branch Development Support 2 3 4 Goals & ERC Results Options Execution Risks
    • Customer Sell-in Support: we will leverage our established relationships with buying organizations to facilitate the sell-in 8 2 Customer Meetings Set-up Negotiation Support Customer Agreement Design  The ability to succeed during sell-in is impacted by multiple factors … – Pricing – Timely supply – Product quality  In addition understanding local culture, way to operate, and the challenges buyers face are key  Our customer sell in specialists can help you throughout this process as you close your agreements  Timing: 6 - 12 weeks Main Deliverables  Pre-meeting document preparation  Game planning for the sell in meetings  Meeting participation  Assistance understanding and setting objectives for retailer agreements  Insight into trade offs retailers are typically willing to make in order to hit internal targets Considerations & Timing  Meeting scheduled with customers targeted  Retailer profiles base on strategic priorities and negotiation methodology
    • At the end of this phase you will decide whether to go ahead and begin building your international business 9 Euro Retail Consulting Services Alignment on whether to  Supply customers with negotiated deals  Go direct (building foreign operations) or use a third party representative  Suspend (postpone) international expansion New Market Opportunity Sizing 1 Go to Market Strategy Customer Sell-in Support Interim Account Management Branch Development Support 2 3 4 Goals & ERC Results Options Execution Risks
    • Interim Account Management: we will help you run your business with established customers in foreign markets 10 3 Product Import Management Customer Management Owned Subsidiary Viability Analysis  If you are not ready to build an organization, we’ll help manage the new established customers  The support we will provide will include two main areas – Import process support: for customers not able to buy the product FOB in US – Customer management: run operations for a limited time – few purchasing cycles  During this period we will build the go / no-go analysis on establishing a subsidiary  Timing: TBD Main Deliverables  New item form management  Promotional calendar negotiation  Customer communication management  Analyzed incremental opportunities from building a wholly owned subsidiary and …  … potential downside from maintaining current model or identifying another third party Considerations & Timing  Regulatory compliance and processes for getting sales approvals from local authorities  Ongoing import operations management – including product forecasting
    • At the end of this phase you will decide whether to go forward and start the actual sell in process 11 Euro Retail Consulting Services Alignment on whether to  Continue with current third party model or identify new partner  Build a wholly owned subsidiary  Suspend international expansion New Market Opportunity Sizing 1 Go to Market Strategy Customer Sell-in Support Interim Account Management Branch Development Support 2 3 4 GOALS OPTIONS EXECUTION RISKS
    • Branch Development Support: we will help you establish your wholly owned subsidiary in one or more foreign countries 12 4 Location Identification Legal Compliance Organization Setup & Hiring  As your business evolves, you will decide that is time to establish your own operations and accelerate your profitable growth in the market  We will help you establish a Branch in the new geography – Granting you access to the right information and resources – Helping you identify and recruit and train talent  Timing: TBD Main Deliverables  Analysis of local regulations impacting the business, requirements for branch opening  Support to fulfilling legal compliance forms and procedures prior to branch opening  Managing, recruiting and training of high quality local talent  Setting up the communication with the main company Considerations & Timing  Potential location prioritization – based on customer preference and economics  Financial analysis for location identified compared to other locations