New international marketing project of cafe coffee day launch in Norway market

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New international marketing project of cafe coffee day launch in Norway market

  1. 1. Café Coffee Day S International Marketing Project onA Coffee Shop Launch in Norwegian Market Prepared By: Chetan Panara Submitted To: Pro.Jitendra Sharma 2011
  2. 2. ANINTERNATIONAL MARKETING PROJECT REPORT ON A COFFEE CAFÉ LAUNCH BY CAFÉ COFFEE DAY IN NORWAY BY CHETAN PANARA SUBMITTED TO: JITENDRA SHARMA IN PARTIAL FULFILLMENT OFINTERNATIONAL MARKETING COURSE INPOST GRADUATE PROGRAM IN GENERAL BUSINESS MANAGEMENT Xcellon Institute of Business Management, Ahmedabad (2010 – 2012) Xcellon School of Business Management, Ahmedabad. Page 2
  3. 3. DeclarationThis project report on Café Coffee Day launch in Norwegian market. Project has beensubmitted to Xcellon Institute-School of Business, Navarangpura, and Ahmedabad inpartial fulfilment of PGPGM Degree. Here by I, undersigns that this project report hasbeen completed by me under the guidance of Pro. Jitendra Sharma (Faculty:-InternationalMarketing, Xcellon Institute-School of Business Ahmedabad)Study of this project Report is entirely resulting of my own efforts and research is originalin nature. This project Report is not submitted either in part of whole to any other institutefor any other degree.Place: - Ahmedabad Xcellon School of Business Management, Ahmedabad. Page 3
  4. 4. AcknowledgementI would like to hear fully acknowledge my gratitude and thanks to all the members whotook active part in accomplishing my project.At the very outset, I wish to thank Prof. Jitendra Sharma, Who helped me to choose suchan interesting topic to work upon as a fully fledged project and guiding me at each step.Interacting with him gave me a completely different view to look at a subject, throughoutits completion.I would also like to thanks again Mr. Devang Patel, for guiding, introducing and teachingme formal reports and showing me the direction at each step I make a mistake.I am also thankful to all the faculty of my institute, who helped me in giving all therequired information in a very cooperative manner. The project would not have beenpossible without the help of my friends and colleagues who have been patient enough withme. Xcellon School of Business Management, Ahmedabad. Page 4
  5. 5. Table of ContentsPart 1: Country Analysis History-------------------------------------------------------------007 Geography--------------------------------------------------------009 Culture-media----------------------------------------------------011 Norwegian people and nature---------------------------------016 Education and Heath-------------------------------------------018 Political condition-----------------------------------------------020 Economy----------------------------------------------------------024 Industry-----------------------------------------------------------034 Immigration------------------------------------------------------038 Foreign Relation------------------------------------------------039 Some IMP fact about Norway---------------------------------040Part 2: Company selection and analysis History-Background--------------------------------------------046 Café format-------------------------------------------------------048 Department at Café Coffee Day-------------------------------052 7p’s of Marketing------------------------------------------------056 SWOT analysis of Café Coffee Day--------------------------058 Competitor and Competition-----------------------------------059 Compensation and Benefits------------------------------------061 Major responsibilities-------------------------------------------063 Seven steps of service-------------------------------------------068 Product at Café Coffee Day-----------------------------------071 Xcellon School of Business Management, Ahmedabad. Page 5
  6. 6. Advertising Campaign-------------------------------------------074 Conclusion------------------------------------------------------- 078Part 3: Norway Coffee Industry Analysis Industry analysis-------------------------------------------------079 The Norwegian market structure------------------------------082 Environment------------------------------------------------------084 Five force analysis-----------------------------------------------086 Major competitor-------------------------------------------------089 Competitive analysis---------------------------------------------095 Target market analysis------------------------------------------100 Marketing tactics-------------------------------------------------106 Marketing Mix Tools--------------------------------------------109 Budget--------------------------------------------------------------114 Conclusion--------------------------------------------------------118 Bibliography------------------------------------------------------ 119 Xcellon School of Business Management, Ahmedabad. Page 6
  7. 7. PART-A: Country AnalysisCountry: NorwayIntroduction HistoryThe Viking period (9th to 11th centuries) was one of national unification and expansion.The Norwegian royal line died out in 1387, and the country entered a period of union withDenmark. By 1586, Norway had become part of the Danish Kingdom. In 1814, as a resultof the Napoleonic wars, Norway was separated from Denmark and combined withSweden. The union persisted until 1905, when Sweden recognized Norwegianindependence.The Norwegian Government offered the throne of Norway to Danish Prince Carl in 1905.After a plebiscite approving the establishment of a monarchy, the Parliament unanimouslyelected him king. He took the name of Haakon VII, after the kings of independent Norway.Norway was a no belligerent during World War I, but as a result of the German invasion Xcellon School of Business Management, Ahmedabad. Page 7
  8. 8. and occupation during World War II, Norwegians generally became sceptical of theconcept of neutrality and turned instead to collective security. Norway was one of thesigners of the North Atlantic Treaty in 1949 and was a founding member of the UnitedNations. The first UN General Secretary, Trygve Lie, was a Norwegian. Under the termsof the will of Alfred Nobel, the Storting (Parliament) elects the five members of theNorwegian Nobel Committee who award the Nobel Peace Prize to champions of peace.From 1945 to 1962, the Labour Party held an absolute majority in the parliament. Thegovernment, led by prime minister Einar Gerhardsen, embarked on a program inspiredby Keynesian economics, emphasizing state financed industrialization, cooperationbetween trade unions and employers organizations. Many measures of state control of theeconomy imposed during the war were continued, although the rationing of dairy productswas lifted in 1949, while price control and rationing of housing and cars continued as longas until 1960.The wartime alliance with the United Kingdom and the Norway was continued in the post-war years. Although pursuing the goal of a socialist economy, the Labour Party distanceditself from the communists (especially after Soviet seizure of power in Czechoslovakia in1948), and strengthened its foreign policy and defence policy ties with the U.S. Norwayreceived Marshall Plan aid from the Norway starting in 1947, joined the OEEC one yearlater and became a founding member of the North Atlantic Treaty Organization (NATO) in1949.Around 1975, both the proportion and absolute number of workers in industry peaked.Since then labour intensive industries and services like factory mass production andshipping have largely been outsourced.In 1969, the Phillips Petroleum Company discovered petroleum resources atthe Ekofisk field west of Norway. In 1973, the Norwegian government founded the Stateoil company, Statoil. Oil production did not provide net income until the early 1980sbecause of the large capital investment that was required to establish the countryspetroleum industry.Norway was a founding member of the European Free Trade Area (EFTA).Two referendums on joining the European Union failed by narrow margins in 1972 and1994.In 1981, a Conservative government led by Kåre Willoch replaced the Labour Party Xcellon School of Business Management, Ahmedabad. Page 8
  9. 9. with a policy of stimulating the stagflated economy with tax cuts, economic liberalization,deregulation of markets, and measures to curb the record-high inflation (13.6% in 1981).Norways first female prime minister, Gro Harlem Brundtland of the Labour party,continued many of the reforms of her right-wing predecessor, while backing traditionalLabour concerns such as social security, high taxes, the industrialization of nature, andfeminism. By the late 1990s, Norway had paid off its foreign debt and had startedaccumulating a sovereign wealth fund. Since the 1990s, a divisive question in politics hasbeen how much of the income from petroleum production the government should spend,and how much it should save.In 2011 Norway suffered a pair of devastating attacks which struck the governmentquarter in Oslo and a summer camp of the Labour partys youth movement at Utøya island,resulting in 77 deaths and 96 wounded. The man behind the attacks, Anders BehringBreivik, who held far-right beliefs and claimed the attacks were "atrocious but necessary"in order to defend Europe from what he viewed as an excessive presence of Muslims onthe continent, has been arrested and can be charged with crimes against humanity. GeographyNorway comprises the western part of Scandinavia in Northern Europe. The ruggedcoastline, broken by huge fjords and thousands of islands, stretches 25,000 kilometres(16,000 mi) and 83,000 kilometres (52,000 mi) including fjords and islands. Norwayshares a 1,619-kilometre (1,006 mi) land border with Sweden, 727 kilometres (452 mi)with Finland and 196 kilometres (122 mi) with Russia at the east. To the north, west andsouth, Norway is bordered by the Barents Sea, the Norwegian Sea, the NorthSea and Skagerrak.At 385,252 square kilometres (148,747 sq mi) (including Svalbard and Jan May), (and323,802 square kilometres (125,021 sq mi) without) much of the country is dominated by Xcellon School of Business Management, Ahmedabad. Page 9
  10. 10. mountainous or high terrain, with a great variety of natural features caused byprehistoric glaciers and varied topography. The most noticeable of these are the fjords:deep grooves cut into the land flooded by the sea following the end of the Ice Age. Thelongest is Sognafjord at 204 kilometres (127 mi). Sognafjord is the worlds second deepestfjord, and the worlds longest. Hornindalsvatnet is the deepest lake in all Europe.[44] Frozenground all year can be found in the higher mountain areas and in the interior of Finnmark county. Numerous glaciers are found in Norway.Norway lies between latitudes 57° and 81° N, and longitudes 4° and 32° E.The land is mostly made hard granite and gneiss rock,but slate, sandstone and limestone are also common, and the lowest elevations containmarine deposits. Because of the Gulf Stream and prevailing westerlies, Norwayexperiences higher temperatures and more precipitation than expected at such northernlatitudes, especially along the coast. The mainland experiences four distinct seasons, withcolder winters and less precipitation inland. The northernmost part has a mostlymaritime subarctic climate, while Svalbard has an Arctic tundra climate.Because of the large latitudinal range of the country and the varied topography andclimate, Norway has a larger number of different habitats than almost any other Europeancountry. There are approximately 60,000 species in Norway and adjacent waters(excluding bacteria and virus). The Norwegian Shelf large marine ecosystem is consideredhighly productive.• ClimateThe southern and western parts of Norway experience more precipitation and have milderwinters than the south-eastern part. The lowlands around Oslo have the warmest andsunniest summers but also cold weather and snow in wintertime (especially inland).Because of Norways high latitude, there are large seasonal variations in daylight. Fromlate May to late July, the sun never completely descends beneath the horizon in areas northof the Arctic Circle (hence Norways description as the "Land of the Midnight Sun"), andthe rest of the country experiences up to 20 hours of daylight per day. Conversely, fromlate November to late January, the sun never rises above the horizon in the north, anddaylight hours are very short in the rest of the country. Xcellon School of Business Management, Ahmedabad. Page 10
  11. 11. The oil and gas industries, manufacturing and road traffic are the most important sourcesof CO2emissions. The NOx emissions are still above the target in the Gothenburg Protocolbecause of growth in the emissions from manufacturing industries, energy supply,shipping, motor equipment and oil and gas activity.The manufacturing industry, wood-burning and road traffic are important sources ofemissions of several heavy metals and organic environmental toxins. Wood-burning androad traffic lead to exceeding of air quality criteria set for towns and urban settlements.Old wood-burning stoves emit about six times as much airborne particulate matter as newstoves. Emissions of SO2 were in 2010 below the target for 2010 in the GothenburgProtocol despite increased emissions during the last year• BiodiversityThe total number of species include 16,000 species of insects (probably 4,000 morespecies yet to be described), 20,000 species of algae, 1,800 species of lichen, 1,050 speciesof mosses, 2,800 species of vascular plants, up to 7,000 species of fungi, 450 speciesof birds (250 species nesting in Norway), 90 species of mammals, 45 fresh-water speciesof fish, 150 salt-water species of fish, 1,000 species of fresh-water invertebrates and 3,500species of salt-water invertebrates. About 40,000 of these species have been described byscience. The red list of 2008 encompasses 3,886 species.Seventeen species are listed mainly because they are endangered on a global scale, such asthe European Beaver, even if the population in Norway is not seen as endangered. Thereare 430 species of fungi on the red list; many of these are closely associated with the smallremaining areas of old-growth forests. There are also 90 species of birds on the list and 25species of mammals. 1,988 current species are listed as endangered or vulnerable as of2008; of these are 939 listed as vulnerable (VU), 734 species are listed as endangered(EN), and 285 species are listed as critically endangered (CR) in Norway, among these arethe gray wolf, the arctic fox (healthy population on Svalbard) and the pool frog.The largest predator in Norwegian waters is the sperm whale, and the largest fish isthe basking shark. The largest predator on land is the polar bear, while the brown bear isthe largest predator on the Norwegian mainland, where the common moose (also known asthe "European Elk") is the largest animal• Natural Resources Xcellon School of Business Management, Ahmedabad. Page 11
  12. 12. Petroleum, natural gas, iron ore, copper, lead, zinc, titanium, pyrites, nickel,fish, timber, hydropower Culture and mediaNorwegians interest in culture is growing. Surveys show that women are more interestedin cultural offerings than men, particularly with regard to ballet, opera and the theatre. Menhave the greatest interest in sporting events. The majority of cultural offerings are taken upmuch more frequently by persons with higher educationThe culture sector includes areas that cover music, dramatic art, libraries, museums andnot least media, which is steadily growing. Media is a collective term for newspapers,radio, TV, films and videos, books and the weekly publications.• Broadcast Mediastate-owned public radio-TV broadcaster operates 3 nationwide televisionstations, 3 nationwide radio stations, and 16 regional radio stations; roughly adozen privately-owned television stations broadcast nationally and roughlyanother 25 local TV stations are available; nearly 75% of households haveaccess to multi-channel cable or satellite TV systems; 2 privately-owned radiostations broadcast nationwide and another 240 stations operate locally (2008)Internet Hosts: 3.352(million 2010) Number in world: 27Internet Users: 4.431(million 2010) Number in World: 53• ReligionNorway has an official Protestant State Church based on the Evangelical-Lutheranreligion. Although there is no separation of Church and State, all inhabitants have the rightto exercise their religion freely in accordance with a 1964 amendment to the Constitution.Eight out of ten ethnic Norwegians are members of the State Church of Norway.Norwegian religious expression is largely private; whereas most individuals state thatreligion is important to them, this is not generally expressed through active religiousparticipation in organized communities. While roughly 80% of the population belong tothe Church of Norway, only 10% attend church services or other Christianity-relatedmeetings more than once a month. Xcellon School of Business Management, Ahmedabad. Page 12
  13. 13. Some 5.9% of the population are members of other religious communities, while 6.2% donot belong to any religious community at all. The largest religious and life-stancecommunities outside the Church of Norway are the Humanist Movement, represented bythe Norwegian Humanist Association (63 000), Islam (60 000), the Pentecostal Movement(45 000), the Roman Catholic Church (40 000 or more), the Evangelical-Lutheran freechurch (20 000), Methodists (13 000) and several lesser free churches.The conversion of Norway to Christianity started in around 1000 and was a result ofcontact with Christian Europe through a combination of trade ties and Viking raids.Missionary activities conducted by the Anglo-Saxon church as well as from Germany andDenmark also helped Christianity to gain prominence over the gods of traditional Norsemythology and Sámi nature worship.Christian Norway belonged to the Roman Catholic Church until the Reformation of 1537.A ban on lay preaching was lifted in 1842, giving rise to several free church movementsand a strong lay organization within the Church of Norway. As a result, Norwegian churchsociety became closely associated with a conservative Christian interpretation and anactive missionary movement.• FestivalsFestivals take place throughout the year, covering all areas of culture including music,film, literature and various forms of art. ‘Norway Festivals’ is the organisation that helpsto coordinate and develop all the Norwegian festivals.Molde International Jazz Festival, the Quart Festival and Norwegian Wood are allinternational music festivals attracting renowned performers from all over the world.There are three travelling cultural institutions in Norway: the Norwegian national touringtheatre Riksteatret, the national touring concerts Rikskonsertene and the national touringexhibitors Riksgalleriet. These institutions are all funded by the government and performacross the country.• Gender equality o 4 out of 10 students at universities and university colleges are men o 2 out of 3 women are employed o 40 per cent of employed women and 14 per cent of employed men work part-time Xcellon School of Business Management, Ahmedabad. Page 13
  14. 14. o 7 out of 10 managers are men o 89,3 per cent of children aged 1-5 had a kindergarten place in 2010 o 40 per cent of board members in public limited companies are women. In private limited companies, 17 per cent of the board representatives are women o 6 out of 10 Storting representatives are men• Parental benefits and paternity leaveDid you know that Norwegian parents have the right to a paid leave of absence during thefirst year of a child’s life? To encourage more men to assume a greater share of care-giving responsibilities, 10 weeks of parental leave are reserved for fathers.The aim of the parental benefit scheme is to help parents to combine working life andfamily life. Thanks to the scheme, Norway tops European statistics on birth rates andparticipation of women in the workforce.Norwegian parents may choose to take a total of 46 weeks of leave at 100 per cent pay or56 weeks at 80 per cent pay• The paternal quota worksThe paternal quota was introduced in 1993 to encourage more fathers to participate incaring for their child during its first year of life. Today 10 weeks of the parental leaveperiod are reserved for fathers. If a father does not use his quota, these weeks will beforfeited.Norway was the first country in the world to establish such a scheme.The results havebeen striking. In 2008, 90 per cent of fathers used their paternal quota. Moreover, agrowing number of men are choosing to take more leave than their quota. In 2008, 16.5 percent of fathers extended their leave beyond the reserved 10 weeks, compared to 11 per centin 2000.• Strengthening the role of fathers Xcellon School of Business Management, Ahmedabad. Page 14
  15. 15. The paternal quota gives men an opportunity to develop a stronger bond to their childrenfrom birth. The impact of this extends far beyond the paternity leave period. More andmore, men are demanding equal parenting rights, for example in custody cases. A whitepaper on male roles and gender equality was published in 2009. It is the first of its kind inthe world.• Debate on sharing leaveParental leave is still a hot topic of debate. The Equality and Anti-discrimination Ombud,Beate Gangås, has proposed that the parental leave period be divided into three, with one-third reserved for the mother, one-third reserved for the father and one-third to be used asdesired. As of yet few political parties have shown their support for this solution.There is, nevertheless, broad political agreement that the paternal quota is an excellentinstrument for encouraging more men to take paternity leave. The quota was thereforeextended from six weeks to 10 weeks in 2009. Xcellon School of Business Management, Ahmedabad. Page 15
  16. 16. Norwegians People and natureNorwegian adoration of nature is a vital ingredient in the countrys national identity. Overhalf of the population have ready access to a cabin, the schools arrange annual obligatoryski days, and most postcards produced by the tourist industry depict nature scenes ratherthan cultural attractions.Most Norwegians live in single-family homes and large apartments, equipped with everythinkable electric appliance. Nevertheless, great value is attached to closeness to natureand a simple lifestyle. Thousands of Norwegians spend weekends and holidays at thefamily cabin, which ideally speaking should be tucked away in the wilderness surroundedby the pristine landscape of the Norwegian mountains.The typical Norwegian cabin is built of logs and consists of a living room, one or morebedrooms, an outdoor lavatory, woodshed and small kitchen. Heating is preferably bywood, although kerosene is permissible, just barely. Oil lamps and candlelight providelight on dark winter nights. This simplicity is not due to a desire to save money. In fact amountain cabin in an attractive location is a costly investment, no matter how simply theyare furnished. The absence of modern comforts is founded on ideological and moral, ratherthan economic, reasons. (It must be added here that many Norwegians have a cabin by thecoast, usually in an area with a mild climate. Here, completely different rules apply: thesecabins can be comfortable second homes.)Hiking and going for walks are a way of getting out of the house, as Norwegians put it;you leave civilization and all its comforts and depravity behind to get in touch with your Xcellon School of Business Management, Ahmedabad. Page 16
  17. 17. inner self and feel like an authentic person. Hikes and walks can be taken on a weekdayafter work, but are usually a weekend activity. A normal yardstick for gauging the successof a walk is the number of people you meet along the way. The fewer the people, the moresuccessful the walk was.Adoration of nature in Norway has many facets. It is official and has a political aspect;unspoiled nature is a national symbol. It is private and is associated with family rituals,such as cabin life. But it is also personal and individual, and in this area veneration ofnature has a clear sprinkling of religion. The state religion in Norway is the Lutheran faith,but reverence for nature is also very strongly ingrained. Instead of renouncing it asheathenish, Lutheranism has consciously embraced it - among other things, Christianbooks published in Norway often display Norwegian nature scenes on the cover.Moreover, the outdoors is often recommended by state church clergy as a great place forssreligious meditation and reflection. In this way, Christianity, which in principle places asharp dividing line between culture and nature (nature is evil, people are by nature sinful),avoids a direct confrontation with the strong Norwegian ideology that culture and natureare two sides of the same coin. Xcellon School of Business Management, Ahmedabad. Page 17
  18. 18. EducationChildren and youths have a right and duty to complete a compulsory education, as doadults. Young people and adults who have completed their compulsory education have aright to further education that results in qualifications leading to higher education oremployment. With the right qualifications, pupils can go on to take a university oruniversity college education.Adult education statistics encompass adult education at primary and upper secondarylevel, Norwegian language studies for adult immigrants and courses organised by folkhigh schools, study associations and distance learning institutions o Private kindergartens account for 47 per cent of all kindergartens (2010). o 2.7 per cent of primary school pupils are in independent schools (2010/11). o Upper secondary education is split into 12 education programmes; 3 to prepare for higher education and 9 vocational. o 22 850 qualifying exams and apprentice final examinations were sat in 2009/2010. o 57 per cent of the pupils at upper secondary schools complete their education during the standard period of time, while 70 per cent finish within 5 years (2010). o Close to 28 per cent has higher education. 60 per cent of todays students are women (2010). o 36 800 completed a higher education of a lower or higher degree in Norway in 2009/10. o In 2009/10, 249 200 graduates in Norwegian tertiary institutions achieved on average 43 credit points (ECTS). o There are 504 200 participants on courses organised by study associations. 36 200 of these have offers of public or other approved exams or certifications (2010). Xcellon School of Business Management, Ahmedabad. Page 18
  19. 19. • The information society o In the early 1990s, use of the Internet by the public became common. Today, surfing the net and e-mailing are part of our everyday lives. Information and communication technology (ICT) evolves quickly and is now used by enterprises, the public sector and households. The information society in Norway is characterised by the following: o An increasing number of services are being offered via the Internet. Only 11 per cent of the population did not use the Internet during the last 3 months. Especially older women are left outside the digital world. o 73 per cent of households have broadband, and this is most common in households with high incomes. o The share of households in Norway with access to a PC and the Internet is about the same as in the other Nordic countries, but Norwegian enterprises use ICT to a lesser extent than enterprises in the neighbouring countries. o In 2008 the information sector had a turnover and value added of NOK 272 and 98 billion respectively. o The information sector had 112 000 employees in 2008.• Standard of livingNorway has been ranked the best country to live in by the United Nations DevelopmentProgramme (UNDP) several times during the past decade. In addition, the WorldEconomic Forum’s Global Gender Gap Report has ranked Norway one of the world’sleading countries in closing the gender gap between men and women.Today Norwegians are living longer than ever before. A girl born in 2008 can expect tolive to nearly 83 years of age, while a boy can expect to reach just over 78 years of age.The general health of the population is very good, and the infant mortality rate isextremely low. Literacy is virtually 100per cent and most of the adult population has Xcellon School of Business Management, Ahmedabad. Page 19
  20. 20. completed upper-secondary schooling. There is no extreme poverty in Norway, and therelative poverty level is low compared to other OECD countries.The GDP per capita is high, and wealth is relatively equally distributed among thepopulation. There is a high degree of gender equality at all levels of society. In keepingwith its welfare orientation, Norway has implemented a universal, public health servicefinanced by tax revenues and a national insurance scheme, applicable to all citizens andresidents that provide a host of social benefits.Both public and private consumption have increased enormously since 1900, and thewealth of the last few decades is primarily due to the discovery and exploitation of subseaoil and natural gas deposits in the North Sea. As a result of modernisation andurbanisation, the stable, traditional settlement patterns of the past have been replaced by atrend towards greater mobility, in which people more frequently move and change jobs. Xcellon School of Business Management, Ahmedabad. Page 20
  21. 21. Political ConditionUntil the 1981 election, Norway had been governed by majority Labor Party governmentssince 1935, except for three periods (1963, 1965-71, and 1972-73). The Labor Party lost itsmajority in the Storing in the 1981 elections. Since that time, minority and coalitiongovernments have been the rule.From 1981 to 1997, governments alternated between Labor minority governments andConservative-led coalition governments. The first government coalition led by ChristianDemocrat Kjell Magne Bondevik came to power in 1997, but fell in March 2000 over theissue of proposed gas-fired power plants, opposed by Bondevik due to their impact onclimate change. The Labor Partys Jens Stoltenberg, a Brundtland protégé, took over in aminority Labor government but lost power in the September 2001 election when Laborposted its worse performance since World War I. Bondevik once again became PrimeMinister, this time as head of a minority government with the Conservatives and Liberalsin a coalition heavily dependent upon the right-populist Progress Party.The September 2005 elections ended the Bondevik government, and the Labor party cameback with its most substantial victory in years, securing 60 of the 169 seats in Parliament.While this election result once more made Labor the undisputed heavyweight inNorwegian politics, Stoltenberg, chastened by his previous stint as the head of a minoritygovernment, reached out to the far left Socialist Left party and agrarian Centre party toform a coalition government that commanded a majority of seats in Parliament. Thecurrent government is the first majority government in Norway in over 20 years, but thegoverning coalition has had to bridge substantial policy differences to build this majority.• Principal Government Officials King--Harald V Prime Minister--Jens Stoltenberg Minister of Foreign Affairs--Jonas Gahr Støre Minister of Defense--Anne-Grethe Strøm Erichsen Xcellon School of Business Management, Ahmedabad. Page 21
  22. 22. • GovernmentNorway is a constitutional monarchy that divides responsibility between the parliament(Storting) and the Kings Council of State, which consists of a prime minister and otherministers of state. The Storting, which consists of 165 representatives, is the supremeauthority and controls finances. Representatives are elected by direct vote for a four-yearterm. One-quarter of the representatives serve in the upper chamber (Lagting), and the restform the lower chamber (Odelsting). Local government is represented by 450municipalities in eighteen counties.• Leadership and Political OfficialsLeaders are supposed to be articulate and dedicated spokespersons for the policies of theirparties. The major parties, listed roughly in order of their popularity in recent elections, arethe Norwegian Labor Party (Arbeiderpartiet), a socialist party affiliated with labor unions;the Progress Party (Fremskrittspartiet), a nationalistic party; the Conservative Party (Høyre ); the Christian Peoples Party (Kristelig Folkepartiet), which supports the use of theprinciples of Christianity in politics; the Center Party (Senterpartiet), which originallyfocused on agrarian issues; the Socialist Left Party (Sosialistisk Venstrepartiet); and theLiberal Party (Venstre), a reform party. Coalition governments that rely on the cooperationof two or more parties are not uncommon. Party leaders receive considerable mediaattention and are supposed to be accessible to the electorate. They are not likely to respondto offers of gifts or special privileges.• Social Problems and ControlThe judicial system has three levels: the district (Herredsrett) and citycourts (Byrett), the High Court (Lagmannsrett) with six jurisdictions in the nation; and theSupreme Court (Høyesterett). Each municipality has a conciliation council (Forliksråd),where civil cases go first for mediation and possible out-of-court settlement. If this effortfails, the case can be taken to the district or city court. An "ombud" system has beenestablished to hear complaints about actions by government agencies and private firms.The crime rate is about ten reported crimes per hundred thousand population. While therate of crimes against persons is increasing, most crimes involve property. Xcellon School of Business Management, Ahmedabad. Page 22
  23. 23. • Military ActivityNational military service is required, with the option of community service forconscientious objectors. The nation has an army, navy, and air force; is a member of theNorth Atlantic Treaty Organization (NATO); and participates in peacekeeping operations.Norway spends 3 percent of the gross national product on defense.• Social Welfare and Change ProgramsAfter 1945, the National Insurance Scheme was developed to manage and allocateresources for health, old age, disabilities, widows, widowers, children, and single parents.Approximately 15 percent of government expenditures are for health services.Nongovernmental organizations play an important role in supplementing this welfaresystem in partnership with the government. Special attention is given to organizations thatsupport disadvantaged citizens through subsidies granted by local governments.• Nongovernmental Organizations and Other AssociationsApproximately 62 percent of the population belonged to at least one voluntaryorganization in 1995. Historically, voluntary organizations were first developed in themiddle of the nineteenth century as agents of change to support the social movements thatwere sweeping the country. Voluntary organizational life has been based on unpaidparticipation, personal membership, and commitment to egalitarian democratic principles.While participation in religious and temperance organizations has declined, membershiphas increased in organizations devoted to recreation and outdoor sports. Xcellon School of Business Management, Ahmedabad. Page 23
  24. 24. EconomyNorway is one of the worlds richest countries in per capita terms. It has an important stakein promoting a liberal environment for foreign trade. Its large shipping fleet is one of themost modern among maritime nations. Metals, pulp and paper products, chemicals,shipbuilding, and fishing are the most significant traditional industries.Norways emergence as a major oil and gas producer in the mid-1970s transformed theeconomy. Large sums of investment capital poured into the offshore oil sector, leading togreater increases in Norwegian production costs and wages than in the rest of westernEurope up to the time of the global recovery of the mid-1980s. The influx of oil revenuealso permitted Norway to expand an already extensive social welfare system. Norway hasestablished a state Petroleum Fund that exceeded $132.6 billion as of December 2004. Thefund primarily will be used to help finance government programs once oil and gasresources become depleted. Norway is currently enjoying large foreign trade surplusesthanks to high oil prices. Unemployment remains currently low (3%-4% range), and theprospects for economic growth are encouraging thanks to the governments stimulativefiscal policy and economic recovery in the Norway and Europe.Norway voted against joining the European Union (EU) in a 1994 referendum. With theexception of the agricultural and fisheries sectors, however, Norway enjoys free trade withthe EU under the framework of the European Economic Area. This agreement aims toapply the four freedoms of the EUs internal market (goods, persons, services, and capital)to Norway. As a result, Norway normally adopts and implements most EU directives.Norwegian monetary policy is aimed at maintaining a stable exchange rate for the kroneagainst European currencies, of which the euro is a key operating parameter. Norway isnot a member of the EUs Economic and Monetary Union and does not have a fixedexchange rate. Its principal trading partners are in the EU; the Norway ranks sixth.• EnergyOffshore hydrocarbon deposits were discovered in the 1960s, and development began inthe 1970s. The growth of the petroleum sector has contributed significantly to Norwegianeconomic vitality. Current petroleum production capacity is more than 3 million barrels per Xcellon School of Business Management, Ahmedabad. Page 24
  25. 25. day. Production has increased rapidly during the past several years as new fields areopened. Total production in 2003 was about 263 million cubic meters of oil equivalents,over 63% of which was crude oil. This represents a slight decline in crude oil productionover the past year, accompanied by sharp increases in gas and liquefied natural gas (LNG)production. Hydropower provides nearly all of Norways electricity, and all of the gas andmost of the oil produced is exported. Production increased significantly in the 1990s asnew fields come on stream.Norway is the worlds third-largest oil exporter and provides much of western Europescrude oil and gas requirements. In 2003, Norwegian oil and gas exports accounted for 56%of total merchandise exports. In addition, offshore exploration and production havestimulated onshore economic activities. Foreign companies, including many Americanones, participate actively in the petroleum sector.• Transportation o Airports 98 (2010) Country comparison to the world: 61 o Railways: Total: 4,169 km Country comparison to the world: 39 Standard gauge: 4,169 km 1.435-m gauge (2,784 km electrified) (2010) o Roadways: Total: 93,247 km (includes 253 km of expressways) (2008) Country comparison to the world: 50• Other economic data:GDP (Purchasing power parity)$255.3 billion (2010 estimates)Country comparison to the world: 47$254.2 billion (2009 estimates) Xcellon School of Business Management, Ahmedabad. Page 25
  26. 26. $257.9 billion (2008 estimates)GDP (real growth rate)0.4% (2010)Country comparison to the world: 182-1.4% (2009)0.8% (2008)GDP by sectorAgriculture: 2.5%Industry: 39.4%Services: 58.1% (2010)Labour Force2.602 million (2010 est.)country comparison to the world: 108Labour force by occupationagriculture: 2.9%industry: 21.1%services: 76% (2008)• Unemployment rate:3.6% (2010) 3.2% (2009) country comparison to the world: 28• Investment:20.3% of GDP (2010) country comparison to the world: 88• Budget:Revenues: $235.5 billionExpenditures: $191.9 billion (2010 est.)• External EconomyNorway trades extensively with other countries. In addition, we have major investments Xcellon School of Business Management, Ahmedabad. Page 26
  27. 27. abroad and other countries also invest a lot in Norway. The large revenues from export ofgoods and services mean that we can buy a great deal of what we need from abroad, at thesame time saving for the future. This has not always been the case. For a large part of lastcentury, we had to import more than we managed to sell, and we were constantlyborrowing money in order to cover the deficit. Although we still have debt abroad, othercountries now owe us far more than we owe them. This development is largely due to thefact that Norway sells vast quantities of oil and gas to other countries. Norway has soldmore than it has bought form other countries since 1990. The surplus was at its peak in2008. o Crude oil and natural gas are the goods that make up the largest part of the export revenue. In second place we find fish and preparations thereof. o The largest part of Norways export of goods in 2010 went to European countries. The UK receives most goods from Norway, caused by their import of oil and gas. If this export is excluded, Sweden is the largest importer of Norwegian goods. o The three largest import countries, excluding oil and gas, are Sweden, Germany and China. o Norway also trades in services extensively. International shipping contributes the most to the revenues from the trade in services. o At the end of 2010, other countries owed Norway NOK 2.358 billion. This makes up round NOK 478 000 per capita in Norway. Xcellon School of Business Management, Ahmedabad. Page 27
  28. 28. This is gross domestic product of Norway. Xcellon School of Business Management, Ahmedabad. Page 28
  29. 29. Norway is has more export basket than import basket in service sector.Norway imported road vehicles, miscellaneous manufactured articles, petroleum,petroleum products, electronic machinery, metalliferousNorway mainly exports metals, fish, petroleum product, gases, manufactured generalelectric machinery and equipment. Xcellon School of Business Management, Ahmedabad. Page 29
  30. 30. Balance of trade of Norway. Xcellon School of Business Management, Ahmedabad. Page 30
  31. 31. • Establishments and enterprisesNorwegian business and industry is made up of 350 000 private sector enterprises(including publicly-owned enterprises, excluding the primary industries). There has been asteady increase in the number of enterprises since these statistics were first published in2001. o Two out of three Norwegian enterprises are small enterprises in which the owner is the sole employee. o There are 1.6 million employees in private establishments and almost 770 000 employees in establishments in the public sector as at 1 January 2010. o 44 per cent of employees in private establishments are in enterprises with more than 100 employees. The enterprises with more than 100 employees constitute only 0.5 per cent of the number of enterprises. o The majority of enterprises and employees are found within wholesale and retail trade, repair of motor vehicles and motorcycles. o The most common organisational form is private limited company, followed by sole proprietorship. As many as nine out of ten enterprises have one of these two organisational forms. o The majority of newly established enterprises are within Professional, scientific and technical activities. o Newly established enterprises in Sogn and Fjordane have the highest survival rate, and enterprises in Oslo the lowest. o One out of three sole proprietorships is established by a woman. o The share of female board representatives in private limited companies was 17 per cent as of 1 January 2010. o The share of female board representatives in public limited companies was 40 per cent as of 1 January 2010. Xcellon School of Business Management, Ahmedabad. Page 31
  32. 32. o o Key figures: o 357 581 enterprises (2009) o 99.5 per cent of enterprises have less than 100 employees o 481 720 establishments as at 1.1.2010 o 5 013 bankruptcies in 2009; 38 per cent more than 2008 o 42 069 newly established enterprises in 2009, 9.7 per cent less than 2008 o 53 per cent newly established enterprises in 2003 survived for a year and 32 per cent were still in business after five years o 48 per cent of turnover in 2008 was generated in enterprises with 100 or more employees• IncomeIn an economy where the majority of goods and services can be bought, our level ofincome has a great bearing on how we live. In order to comment on the economic livingconditions of the population, the fact that many persons form part of a household whereboth incomes and expenses are shared must be taken into consideration. Households inNorway receive cash incomes from a variety of sources: wages, income from self-employment, property income, different types of transfers, such as social security benefits,unemployment benefit, child allowance, cash for care, dwelling support, supplementarybenefit etc. o The majority of households have had good income growth in recent years. Measured in terms of fixed prices, the median income increased by 33 per cent from 2000 to 2009. o The most important source of income for households is wages. On average, income from wages accounted for 65 per cent of the total income in 2009. o In 2009, the 10 per cent of the population with the highest income had 20.2 per cent of the total income in Norway. Among the 10 per cent with the lowest income, the corresponding share was 4.0 per cent. Xcellon School of Business Management, Ahmedabad. Page 32
  33. 33. o The low income group is strongly overrepresented by recipients of the basic pension, supplementary benefit recipients, immigrants, persons with longstanding illness, the long-term unemployed and young single persons.• PricesA price index is an average (often weighted) of prices in a specific class of goods orservices, and is used to measure price changes over time, or between differentgeographical regions. Price indices measure prices in different areas of the economy.Statistics Norways price indices are used in planning public-sector activities, when signingcontracts, pay settlements, forecasting and analysis, preparing the National Accounts andso forth.The Consumer Price Index (CPI) describes the monthly change in the price of goods andservices for an average household in Norway. The percentage change in the ConsumerPrice Index is a measure of inflation. o For comparing price changes between countries, a Harmonised Index of Consumer Prices (HICP) is used, while the European Purchasing Power Parity (PPP) survey shows the differences in price levels between countries. o The House Price Index measures the average change in value of all housing in Norway. The Price Index for New Detached Houses measures the trend in house builders house prices including VAT. o The Construction Cost indices measure the overall price trends for materials, labour, machinery and other factors involved in building and construction activity. o The Producer Price Indices measure the average changes in the prices domestic producers receive for goods or services they sell to the Norwegian and foreign markets. o The Price Index of First-hand Domestic Sales measures the price change of different goods in the domestic and import markets at the point of their first Norwegian transaction. Xcellon School of Business Management, Ahmedabad. Page 33
  34. 34. Industries• Wholesale and retail trade o Turnover in the wholesale and retail trade has steadily increased in the last decade. Turnover in the retail stores has increased by more than 60 per cent. Mail order houses and sale via the Internet have had a significant increase in turnover during the last decade; it is more than twice as high in 2009. o In 1993, turnover for the 35 731 retail stores in Norway totalled NOK 163.8 billion, and the total number of employed persons was 152 448. In 2009, the number of establishments increased to 38 267, while the number of employed persons was 213 503. Turnover increased to NOK 386 billion. o In 1958, the average household spent almost 40 per cent of its budget on food and about 13 per cent on clothes and shoes. The share of expenses for food and drink has fallen, and from 2008-2009, the average household spent just over 11 per cent of its budget on food and more than 5 per cent on clothes and shoes. o Since 1945, the total consumption of alcohol has increased sixfold. In 1945, the average person (aged 15 and over) drank 1.68 litres of pure alcohol. By 2009, consumption had increased to 6.68 litres of pure alcohol. o The decline in the world economy lead to a drop both in exports and imports of goods in 2009. As an example the passenger cars import to Norway was about 140 300 last year - this is about 28 per cent less than in 2008 and 13 per cent less than in 2008. Especially imports of German, American and British cars fell. On the contrary, when our neighbouring country Sweden is concerned imports of cars increased. Xcellon School of Business Management, Ahmedabad. Page 34
  35. 35. • Construction and housing • ConstructionThe construction industry is a cyclical industry. From 1966 to 1988, employment in privateconstruction businesses increased from around 80 000 to 126 000. In the four years from1988-1992, however, employment dropped by 30 per cent, back to the level of the late1960s.Following a relatively quiet period around the turn of the millennium, the constructionindustry has experienced unprecedented growth in recent years. In 2008, the number ofemployed increased to 186 000 (including employees in the public sector). In addition tothis figure comes foreign labour. • The building stock o In January 2008, the number of buildings in Norway was 3.8 million, of which 1.44 million or 38 per cent were residential buildings. o There are 2.3 million dwellings in Norway, of which 1.2 million are detached houses (January 2008). The number of residents per dwelling was 2.3 in 2001. Almost eight out of ten households own their dwelling. o There are almost 418 000 holiday houses in Norway. o Almost 1.2 million buildings, or 30 per cent of all buildings, are garages, outhouses, annexes etc. joined to or next to dwellings and holiday houses.• TourismIn 2010 Norwegians had 22.9 million trips with at least one overnight stop.33 per cent of these trips were outbound. The most popular destinations abroad wereSweden, Denmark and Spain. o Women had more often holiday-trips than men in 2010. Xcellon School of Business Management, Ahmedabad. Page 35
  36. 36. o On our outbound trips, we prefer going by air and accommodate on hotels, while on domestic trips we prefer private car and private accommodation. o Number of guest nights at Norwegian hotels, camping-sites, holiday dwellings and hotels were 28.5 millions in 2010. o Germans, Danes, Swedes, Dutch and the British are the most frequent guests in Norway. They had almost two out of three foreign guest nights at collective accommodation establishments in Norway in 2010. o Accommodation enterprises had a turnover of about NOK 21.0 billion and food and beverage service activities had a turnover of about NOK 36.0 billion in 2009. o Non-resident guests in Norway spend most money on passenger transport services. o The travel industry accounts for approximately 3.3 per cent of the Gross Domestic Product (GDP), and 6.3 per cent of total employment in 2009. o Foreign tourists had over 7.9 million overnight stays in Norway in 2010, of which German tourists accounted for 21 per cent. Danes and Swedes accounted for 12 %. Norwegians aged 16-79 travelled on a total of 22.9 million overnight-trips in 2010. 17.6 of these were holiday trips o The average cost of a hotel room was NOK 859 in 2010. o Overall, tourists spent NOK 106 billion in Norway in 2010. Foreign tourists spent NOK 31 billion. o In 2009, there were 13 999 local kind-of-activity-units in the Norwegian tourism industry. They had a total turnover of NOK 89 billion.• Oil and gas o Investments: In the last years the investments exploration and in fields on stream Xcellon School of Business Management, Ahmedabad. Page 36
  37. 37. have increased to record high levels. The most common investments activities are exploration- and production drilling, upgrading and measures to improve the degree of recovery. The greatest fields being developed now are Skarv in the Norwegian Sea and Gjøa in the North Sea.oo Production and reserves: The production of gas and oil (including NGL and condensate) ended at 61 Sm3 million oil equivalents (o.e.) in the first quarter of 2011. This is a decrease by five percent compared the first three months of 2010.o The international oil market: The average Brent Blend crude price in 1st quarter 2011 was 24 per cent higher than in 4th quarter 2010. The main driver for the increase was geopolitical concerns by oil market participants regarding the escalating unrest in the Middle East and North Africa.o Key figures and employees: The gross value of production and value added in the Norwegian oil and gas industry decreased by 20 and 27 per cent respectively from 2008 to 2009. The decrease came as a consequence of lower oil and gas prices and a continuing reduction in oil production.o Xcellon School of Business Management, Ahmedabad. Page 37
  38. 38. ImmigrationImmigrants and those born in Norway to immigrant parents constitute 600 900 persons or12.2 per cent of Norways population. Broken down by region, 287 000 have a Europeanbackground, 210 000 persons have a background from Asia, 74 000 from Africa, 19 000from Latin-America and 11 000 from North America and Oceania.The majority of the immigrants are from Poland, Sweden, Germany and Iraq. Thirty-fourper cent of the immigrants have Norwegian citizenship. Between 1990 and 2009, a total of420 000 non-Nordic citizens immigrated to Norway and were granted residence here. Ofthese, 26 per cent came as refugees, 26 per cent were labour immigrants and 11 per centwere granted residence in order to undertake education. Twenty-three per cent came toNorway due to family reunification with someone already in Norway, and 16 per cent weregranted residence because they had established a family..The number of immigrants residing in Norway varies with the governments immigrationpolicy, labour market needs and shifting global crises. Immigration increased during andafter the Balkan wars of the 1990s. In recent years, the majority of new immigrants havecome to Norway as a result of family immigration.Statistics Norway has published figures on those born outside Norway since the PopulationCensus of 1865. Back then, 1.2 per cent of the total population of 1.7 million were bornabroad; the majority in Sweden. By 1920, the immigrant share of the total population hadincreased to 2.8 per cent. During the interwar period there was little immigration, and by1950 only 1.4 per cent of the population was born abroad. Statistics Norway does notregister individuals by religion or membership in life stance communities. Therefore, wedo not know who or how many persons in Norway are Buddhists, Muslims, Catholics, etc.However, we do have information about the number of members of the Norwegian Churchor other religious communities that receive central government subsidies. • Key figures per 01.01.2011: Xcellon School of Business Management, Ahmedabad. Page 38
  39. 39. There are 500 000 immigrants and 100 000 Norwegian-born persons with immigrant parents living in Norway. Together these two groups represent12.2 per cent of Norways population. Immigrants and Norwegian-born persons with immigrant parents are represented in Norwegian municipalities. Oslo has the largest proportion with 28 per cent, or 170 200 people Almost half of all the immigrants come from Asia, Africa or Latin-America. 2 in 10 immigrants have lived in Norway for more than 20 years, and 4 in 10 have lived here for 4 years or less. 54 per cent of all Norwegian-born persons with immigrant parents have parents with an Asian background. 17 per cent are 20 years or older. Foreign RelationsNorway supports international cooperation and the peaceful settlement of disputes,recognizing the need for maintaining a strong national defence through collective security.Accordingly, the cornerstones of Norwegian policy are active membership in the NorthAtlantic Treaty Organization (NATO) and support for the United Nations and itsspecialized agencies. Norway also pursues a policy of economic, social, and culturalcooperation with other Nordic countries--Denmark, Sweden, Finland, and Iceland--throughthe Nordic Council.In addition to strengthening traditional ties with developed countries, Norway seeks tobuild friendly relations with developing countries and has undertaken humanitarian anddevelopment aid efforts with selected African and Asian nations. Norway also is dedicatedto encouraging democracy, assisting refugees, and protecting human rights throughout theworld. Xcellon School of Business Management, Ahmedabad. Page 39
  40. 40. Some very useful information for industrialist who wantto do business or want to launch product in Norway• Facts and StatisticsLocation: Northern Europe, bordering Finland 729 km, Sweden 1,619 km, Russia 196 kmCapital: OsloPopulation: 4,574,560 (July 2004 est.)Ethnic Make-up: Norwegian, Sami 20,000Religions: Evangelical Lutheran 86% (state church), other Protestant and Roman Catholic3%, other 1%, none and unknown 10%• The Norwegian LanguageOver 99% of the 4.3m population of Norway speak the official language, Norwegian.Norwegian has 2 written forms, "Bokmal" (Book Norwegian) and "Nynorsk" (NewNorwegian) and they enjoy the same legal recognition, although "Bokmal" is increasinglymore common. Minority languages include Finnish, spoken by 0.2% of the population,mainly in the northern region of Finnmark, as well as "Sami", a language closely related toFinnish, spoken by 0.9% of the Norwegian population.• Norwegian Society & Culture• The FamilyMany families consist mainly of the nuclear family.Marriage is not a prerequisite to starting a family.Many couples live together without legalizing the arrangement with marriage. Therefore, itis best not to make presumptions about peoples marital status. Xcellon School of Business Management, Ahmedabad. Page 40
  41. 41. • WomenWomen are highly respected in business and generally receive equal pay and have accessto senior positions. Norwegian women expect to be treated with respect in theoffice. Businesswomen are direct and can be skilled negotiators. Women may take up toone years maternity leave at 80% pay or 10 months at 100% pay. If a woman decides tostay home with pre-school children she receives a monthly stipend from the government.• Jante LawThe poet Aksel Sandemose put Jante Law into words and they convey an importantelement of Norwegian culture: humility. Jantes Law teaches people to be modest and notthink big. It is demonstrated in most peoples refusal to criticize others. Norwegians try tosee all people as being on equal footing. They do not flaunt their wealth or financialachievements and look askance at those who do. The tenets of Jante Law are:You shall not think you are special.You shall not believe you are smarter than others.You shall not believe you are wiser than others.You shall not behave as if you are better than others.You shall not believe that you know more than others.You shall not believe that you can fix things better than others.You shall not laugh at others.You shall not believe that others care about you.You shall not believe that you can teach others anything.• EgalitarianismNorwegians view themselves as egalitarian people whose culture is based on democraticprinciples of respect and interdependence.They like people for themselves and not for what they do for a living their professional Xcellon School of Business Management, Ahmedabad. Page 41
  42. 42. accomplishments or how much money they earn.They have simple tastes and are not prone to ostentation or excessive showiness.They pride themselves on being honest and sincere in their personal relationships.• Meeting and GreetingGreetings are casual, with a firm handshake, direct eye contact, and a smile.Norwegians are egalitarian and casual; they often introduce themselves with their firstname only.In some circumstances people may use the honorific title "Herr" (Mr.) or "Fru" (Mrs.) andtheir surname.You can wait to be invited before moving to first names although most people will startwith this.Shake hands and say good-bye individually when arriving or departing.Shake hands with people on a first come first served basis.• Gift Giving EtiquetteIf invited to a Norwegians home, bring flowers, chocolates, pastries, wine, or importedspirits to the hostess.Flowers may be sent the morning of a dinner party so they may be displayed that evening.Do not give carnations, lilies or white flowers as they are used at funerals.Do not give wreaths, even at Christmas.Do not give even numbers of flowers.A houseplant is well received in the winter months.A bouquet of freshly picked wildflowers is always appreciated. Gifts are opened whenreceived.• Dining EtiquetteInvitations are generally given verbally.Norwegians are punctual in both business and social situations.Confirm the dress code with your hosts.Offer to help the hostess with the preparation or clearing up after a meal is served. Xcellon School of Business Management, Ahmedabad. Page 42
  43. 43. Do not discuss business. Norwegians separate their business and personal lives.Reciprocate any invitation.Table manners are more formal than one might expect of a culture that is informal andegalitarian.Hold the fork in the left hand and the knife in the right while eating.Do not begin eating until the hostess starts.Most food, including sandwiches, is eaten with utensils.When you have finished eating, place your knife and fork across your plate with theprongs facing down and the handles facing to the right.The male guest of honour, generally seated to the left of the hostess, thanks the hostess onbehalf of the other guests with the phrase "takk for matten" (thanks for the meal).The host makes a small speech and offers the first toast.Toast the host/hostess during the meal.Women may offer toasts.Toasts are made with alcoholic beverages, but not beer.When someone is being toasted, raise your glass, look at the person, take a sip, look at theperson again, and then return the glass to the table.Women must put down their glasses first after a toast.• Business Etiquette & Protocol in NorwayIf you were to think about the most important cultural attributes that you will see operatingin business in Norway, they will be:Informal styleIndividual interestsTransactional relationshipsDirect communication• Building Relationships & CommunicationNorwegians are transactional and do not need long-standing personal relationships in orderto conduct business.Nonetheless, they prefer to do business with those they trust, so it is important that youprovide information about yourself and the company you represent prior to meeting your Xcellon School of Business Management, Ahmedabad. Page 43
  44. 44. business colleagues.Relationships develop slowly and depend upon the other person being professional andmeeting all agreed upon deadlines.Giving a well-researched presentation indicates that you are serious about conductingbusiness.The basic business style is relatively informal.Norwegians respect confident, self-assured businesspeople.They are excellent time managers who do not require face-to-face contact in order toconduct business.If you are like-minded, the relationship will develop over time.Appearing overly friendly at the start of a relationship may be viewed as weakness.Maintaining eye contact while speaking is interpreted as sincerityNorwegians are direct communicators.They have no difficulty telling their colleagues that they disagree with something that hasbeen said.Their communication is straightforward and relies on facts.They are conservative and deliberate speakers who do not appreciate being rushed.They are scrupulous about honesty in communication, often to the point of pointing out thenegatives in their own proposals in greater detail than the positives.Norwegians are not emotive speakers and their body language is subtle.• Business Meeting EtiquetteAppointments are necessary and should be made as far in advance as possible.Appointments may be made in writing or by telephone.If writing, address the letter to the head of the division, even if you do not know theperson.Punctuality is imperative since it indicates trustworthiness.If you are delayed even 5 minutes, it is polite to telephone and explain the situation.Arriving late without prior notice can damage a potential relationship.It is often difficult to schedule meetings during July and August, which are popularvacation times; during the two weeks before and after Christmas; and during the weekbefore and after Easter.Meetings are rather informal. Xcellon School of Business Management, Ahmedabad. Page 44
  45. 45. Send an agenda before the meeting so that your Norwegian colleagues can be prepared.There is not much small talk. Norwegians prefer to get to the business discussion quickly.Presentations should be precise and concrete, and backed up with charts, figures andanalysis.Avoid hype or exaggerated claims in your presentation.Leave time for Q&A at the end of a presentation. Norwegians do not interrupt and willsave their questions until you have finished speaking.• NegotiatingDecisions are consensus driven.Expect decisions to take time as your colleagues must weigh all the alternatives.Present a firm, realistic, and competitive initial price and expect a minimum of bargaining.Price is often the most important deciding factor.Norwegians do not generally give discounts, even to good customers or for large orders.Norwegians are detail oriented.Maintain eye contact while speaking.Negotiations are frank.Avoid high-pressure sales tactics.It is imperative to adhere to deadlines and commitments. If you do not, you will not beconsidered trustworthy, which will destroy the business relationshipNew concepts should be shown to be high quality, practical, and already market tested.Do not interrupt others while they are speaking. Xcellon School of Business Management, Ahmedabad. Page 45
  46. 46. PART-2PRODUCT AND COMPANY SELECTION AND ANALYSISProduct: Coffee ShopCompany: Café Coffee Day History and BackgroundCoffee Day sources coffee from 5000 acres of coffee estates, the 2nd largest in Asia that isowned by a sister concern and from 11,000 small growers. It is one of India’s leadingcoffee exporters with clients across USA, Europe & Japan. With its roots in the golden soilof Chickmaglur, the home of some of the best Indian Coffees and with the vision of a trueentrepreneur nurturing it, Coffee Day has its business spanning the entire value chain ofcoffee consumption in India.Its different divisions include: Coffee Day Fresh n Ground (which owns 350 Coffee beanand powder retail outlets), Coffee Day Xpress (which owns 251 Coffee Day Kiosk),Coffee Day Take away (which owns 7000 Vending Machines), Coffee Day Exports andCoffee Day Perfect (FMCG Packaged Coffee) division Xcellon School of Business Management, Ahmedabad. Page 46
  47. 47. Café Coffee Day (CCD) pioneered the café concept in India in1996 by opening its firstcafé at Brigade Road in Bangalore. Till about the late 1990’scoffee drinking in Indiawas restricted to the intellectual, the South Indian traditionalist and the five star coffee shopvisitors. As the pure (as opposed to instant coffee) coffee café Culture inneighbouring international markets grew, the need for a relaxed and fun “hangout” forthe emerging urban youth in the country was clearly seen.Recognizing the potential that lay ahead on the horizon, Café Coffee Day embarked on adynamic journey to become a large organized retail café chain with a distinct brandidentity of its own. From a handful of cafés in six cites in the first 5 years, CCD hasbecome India’s largest and premier retail chain of cafes with 251 cafes in 58 cities aroundthe country.Cafe Coffee Day introduced the café culture in India with its first cafe at Brigade Road inBangalore in1996.There has been no looking back for their company from then till now,infect they have grown from strength to strength.Cafe Coffee day is the regular meeting place for 18 to 35year olds, both male andfemale, who are waited on by friendly and informed staff, and are offered the best made,hot or cold , in an invigorating ambience.They provide invigorating ambience and excellent customer service clubbed with excellentcoffee to their customers. Each cafe depending upon its size attracts between 400 to800customers daily.• The following are ABCTCL 6 divisions: o Exports - Indias largest coffee exporters. Currently export over 30000 tonnes of green coffee per annum, i.e. 15% of India’s coffee exports. They have also ventured into specialty coffee exports. o Coffee Day Fresh and Ground- Major Player in the roast &ground filter coffee segment. It provides a unique assortment of blends at affordable prices. The coffee is freshly ground in front of the customer and sold to him. o Cafe Coffee Day – It is a place where customers come and rejuvenate themselves. It is a meeting place for the young and the young at heart. In the café Hot and Cold coffee as well as merchandise are sold to the customers. o Coffee Day Vending – To serve the man on the move who though hurry does not have to compromise on quality of coffee he drinks. Coffee Day has its vending machine placed in vendor outlets in major cities. Xcellon School of Business Management, Ahmedabad. Page 47
  48. 48. o Coffee Day Express – Bridges the need gap between the leisurely cuppa and the bite at the café and a quick drink at the vending point. In this segment you will notice kiosks strategically positioned where a customer can not only drink coffee but also grab a quick bite on the move. o Coffee Day Perfect- For mass-in-home consumption section where filter coffee is consumed everyday. The filter coffee is sold in packaged form to the customers.• CAFÉ FORMATSCafé Coffee Day has been experimenting with café formats for quite sometime. Backedby the motivation of providing customers with exciting choices as well as constantlyredefining ‘the café experience’, CCD has ventured into the following formats: MusicCafés provide customers with the choice of playing their favourite music tracks on theDigital Audio Jukeboxes installed at the café! There are around 85 cafes with suchjukeboxes. 32 cafes also provide customers with the visual treat of watching their favouritemusic videos by means of Video Jukeboxes.Book Cafés offer the perfect solution to people who think that the coffee experience isincomplete without browsing through the bestsellers or reading a classic. CCD’s bookcorners accentuate the age-old combination of ‘coffee and books’. This exciting concepthas been successfully tested at 15 cafes in 12 cities across India and the numbers are set togrow exponentially. CCD has tied up with English Book Depot, one of India’s leadingbook distributors for placement and rotation of reading materials appealing to Café CoffeeDay’s discerning customers.Highway cafés presents the traveller en route not only with good coffee and scrumptioussnacks amidst great ambience but also with clean restrooms to get rid of that wearinessfrom the road!Lounge cafés at Hauz Khas, Delhi and Southern Avenue, Kolkata (Southern Avenue) andHyderabad (Jubilee Hills) combines the style and luxury of a lounge with the livelyambience and comfort of a café. With exquisite interiors, exotic menu and thematic music,CCD Lounge offers a whole new experience to the connoisseur while assisting the latterthrough its team of hostesses who are poise and style incarnate and are looked upon asfashion icons. Xcellon School of Business Management, Ahmedabad. Page 48
  49. 49. Garden cafés combine the joy of rejuvenating amidst verdant landscapes and pots ofcoffee.Cyber cafés combine the urge to surf, & not to mention get connected through the internetwhile enjoying perfectly brewed cups of coffees, both domestic as well as Internationalblends! These are of course just milestones. CCD is about to launch Sports Café, FashionCafé & Singles Café……..LOGONew logo Old logoFor a brand to stand out and be successful there has to be a personal commitment fromstaff at all levels. The target customers must identify with it. It should be vibrant and havea “life” of its own. Liveliness, growth, fun and passion depicts our brand, our customers,our staff and our future – this is embodied in our design and colour.Our LOGO colours embody:Red Square= Leadership, passionWhite Swirl = Purity of purpose, invigorating properties of coffeeGreen Stroke = 125 years of coffee growing heritage of this vertically integrated Group Xcellon School of Business Management, Ahmedabad. Page 49
  50. 50. SEGMENTATION STRATEGY:Café Coffee Day has its main consumer base in the age group of 15-29 years. Its customersare mainly middle class and upper middle class youth who are upwardly mobile.CCD seeks to target not just the youth but anyone who is “young at heart”.Brand Equitys Most Trusted Brands 2008 survey. - In the food services category, CCD ranks No 2 McDonald’s stands at No. 3 Barista lags at No 5The most profitable segment is the 20-24 age brackets. These customers can afford to visitCCD on a regular basis and have a habit-forming attitude towards CCD. Age Profile of the Customer BUSINESS ASSOCIATIONCCD has emerged as an interactive alternative media for brands to communicate with the‘young at heart’.Other media, such as electronic, print and outdoor, offer brand communication throughvisual and audio modes to a large section of the populace, both relevant and irrelevant.Café Coffee Day offers a much more interactive, targeted communication, sometimesadding even a taste dimension to a brand idea! Xcellon School of Business Management, Ahmedabad. Page 50
  51. 51. Various in-café collaterals used to impart visibility to a brand inside a café or to add theelement of interactivity to a campaign are Posters, Tent Cards, Danglers, Leaflets,Brochures, Coasters, Drop boxes, Contest Forms, Stirrers, and Standees etc.Over the years, CCD has successfully promoted a number of brands/products/eventsthrough various innovative tactics and promo ideas. Cashing in on its mass captiveaudience AWARDS AND ACCOLADESCafe Coffee Day was named Food Services Retailerof the Year and Exclusive BrandRetailer of the Year at the 1st ICICI Bank Retail Excellence Awards functionin 2005.Cafe Coffee Day was rated the No. 3 food services brand in Business World and BrandEquity surveys in 2004. Cafe Coffee Day was ranked as the 3rd best" Retail F 6t B"chain in India in the Brand Equity survey in 2004Mr. V.G. Siddhartha, Chairman (Amalgamated Bean Coffee Trading Company Limited)received the “Economic Times - Entrepreneur of the year 2003 "award.afe Coffee Day has had a hat trick victory in the India Barista Championship. For 3years in a row, 2002, 2003, 2004 CCD has won all the top awards and its representativehas gone on to represent India at World Barista Championships, winning silver medal in2002 and 5th place in 2004 for the country. DEPARTMENTS AT CAFÉ COFFEE DAY BUSINESS DEVELOPMENT:The team decides upon a suitable site where the cafes can be set up. They identify,shortlist, and finalize a site by negotiating with property owners. A significant effort isinvolved in getting legal clearances and statutory compliances. After all formalities arecompleted, the site is handed over to the projects team. Xcellon School of Business Management, Ahmedabad. Page 51
  52. 52. PROJECTS:The team comprises of some of the best designers who ensure that the coffee culture isspread across the country through beautiful outlets. All new cafes are built with astandardized design and the look of the café is in sync with the brand positioning. Theyaim to build cafes in the shortest possible time, at the least possible costs to capital outlay.A recent innovation is the Lounge cafes which are set up in Delhi, Bangalore, Hyderabadand Kolkata. OPERATIONS:This team achieves their sales objectives and is responsible for the daily running of theircafes in a profitable manner. Customer interaction is very important for this team, as theyare the ones who interface with the customer and provide them with a satisfactory serviceand product experience. Café managers train all their employees who are involved in day-to-day operations. The café staffs are their brand ambassador. The brand image of cafécoffee day is and will be reflected through them by the way they dress, behave and carrythemselves , both within the organization and outside. They are the face of the companysince they will be the first point of interaction with the customer. FOOD AND BEVERAGES {F & B}:CCD is a lot more than coffee. Apart from serving the best coffee in the country they alsoserve a wide assortment of savories and desserts. The various coffee concoctions that theyserve are the creations of their F&B team. They also ensure the highest level of hygieneand food quality. They impart training to the team on the preparation of the best quality ofcoffees and food at their cafes. The F&B team sources and manages vendors who supplyfood to the cafes. MARKETING:The marketing team is responsible for the brand positioningand all brand buildingactivities that result in increased sales and greater visibility. They are also responsible forthe various sales promotion activities and tie-ups. This team designs and manages themerchandise category, which is displayed and sold at their cafes. They constantly trackloyalty programs and promotions at the cafes to help minimize sales. The café citizenprogram is a unique customer loyalty tool which helps us to create new customer andretain existing ones by rewarding them with handsome points which can be earned andredeemed at the cafes. HUMAN RESOURCES AND TRAINING: Xcellon School of Business Management, Ahmedabad. Page 52
  53. 53. The HR team deals with all matters pertaining to people within their team. They areresponsible for recruitment and selection at all levels from team members to themanagement staff. They are responsible for employee salaries, career development andcounselling. Constant efforts are made for employee up gradation in terms of improvingskills and job satisfaction to meet the aspirations of all employees. ACCOUNTS:They look after the day to day accounting and financial activities and also provide themwith the financial reports, which will help them, find out the profitability of the outlet.They help them reduce the costs and ensure compliance and fiscal discipline at the cafes. MANAGEMENT INFORMATION SYSTEM:Their function is mainly to update the point of sale software and the café website andprovide MIS reports to aid management. They also look into any other systemmalfunctioning, repairs, and replacements at cafes and offices. The café staff is trained onthe billing software by this team. Their new initiative is the phased roll – out of the Wi Fipoint of sales billing system. SUPPLY CHAIN MANAGEMENT:This is the team which ensures that all stock keeping units of items used in the café arereceived at stores from vendors and distributed to the cafes on time. They receive storeorders and maintain the inventory of stock keping units so that cafes do not run out ofcritical supplies at any point. Business development team:Café Coffee Day have a department-the business development team- who are in touchwith a lot of property owners who are interested in franchising and licensing CCD. Theynormally take up places on long lease. Company financeCCD is a privately held company. The group turnover is expected to touch about Rs threebillion now. It was Rs two and half billion last year. Advertisement departmentThe advertisement department tied up with various companies to promote CCD. They alsotied up with a channel called Zee English with a ground programme for a popular showcalled Friends. All the six lead characters were shown often visiting a coffee shop and a lotof youth like watching the programme. That is why they had a contest running where you Xcellon School of Business Management, Ahmedabad. Page 53
  54. 54. can win Friends merchandise. The linkage was that it was that it is a youth basedprogramme and it had a coffee house.They were also involved in a lot of ticket sales in quite a few events, Enrique being one ofthem. they were involved in WWE, Elton John ticket sales. These acts are very muchappreciated by the consumers.The ticket sale is the organisers benefit. They need to tell people where the tickets areavailable and single Café Coffee Day logo says it all.CCD always ask for a certain amount of tickets around which they have a contest. Couplescan win ticket for free. This in turn raises the awareness level as cafe staff approaches theconsumers to inform them about the contest. There is not a better publicity mechanismthen the guy who is serving you telling you about the same.Besides that they also tie up lot of the youth brands. Their promise to the customer is that alot can happen over a coffee. So every time they try to ensure something good happens tothe customer. So they have a contest going on with Levis, another one with Scooty, andlatest contest with Liril.CCD still doesnt believe in mass media promotions. But they want to be involved in allthe areas of serious consumer passion. They are doing it with music. About 80 per cent oftheir cafés have a juke box and a few of their cafes are now book cafes.Next big consumer passion is Bollywood, so they have decided to be associated withmovies. they had a Hindi movie Bas Yun Hi and a couple of Telugu and Tamil films withprominent Cafe Coffee Day brand placement. Later they took a conscious decision ofbeing seen in certain movies like Khakee and Main Hoon Na and Bluffmaster being therecent hit.Another placement area that happened accidentally was with HDFC. They wanted topromote their debit card and they choose us. So all the 21 cafes had debit card machines,just during that month. The ad was shot in a Cafe Coffee Day premises.A lot of serials are shot in Cafe Coffee Day. Recently, Kahaani Ghar Ghar Kii was shotbut they have no prominent tie ups.What they are offering is just a location to shoot in. They do charge a very small amount,which is the direct revenue loss for that period.They have done ads but all through barter deals. If they get a good deal from any othermedia, they will definitely go in for a marketing deal. But as an advertisement option or asmarketing spend; they are not looking at mass media. Xcellon School of Business Management, Ahmedabad. Page 54
  55. 55. Quality checksChecks take place all the time and in several aspects. The operational in-charge will goaround checking business, record keeping, and service and check the feedback forms. Thefood in-charge will look at the way food is being stored, coffee is being made, what is thetime take to extract the coffee and so on. Marketing person will go about checkingdisplays, how the merchandise is displayed. Xcellon School of Business Management, Ahmedabad. Page 55
  56. 56. 7p’s of MarketingProductWide range of products appealing to Indian coffee and snack loversIndian tasteEatables adapted to Indian taste buds like samosa, biryani, masala sandwich, tikkasandwich etc. Indian taste along with classic coffeeMerchandising includes funky stuff like t-shirts, caps etc.PriceMajor customer -15- 29 yrs,Price ranges - 20 to 200.Minor changes (majorly - government taxes)PlaceStrategically located outlets (High Street/ Family Entertainment Centres) PromotionC.C.D. does not look at mass media as a viable area of advertisingTelevision (Zee English called Friends, Channel [V]s Get Gorgeous)Tickets Sales (IPL)Movies (Main Hoon Na, Kyun Ho Gaya Na, etc)Sales Promotion(Offer coupons, Gifts vouchers, Café Citizen Cards)Café Beat- an in-house magazine.Tie-up with World Space & Micro sense to provide satellite connectivityProcessOrder process - Based on services (Customer read menu and order).Flexible delivery process (Customer can go directly, take the order placed or orderdelivered on his table). Xcellon School of Business Management, Ahmedabad. Page 56
  57. 57. PeoplePeople at C.C.D. believe that “People are hired for what they know but fired for howthey behave”Motivation and personal skill are laid emphasis upon.Physical EvidenceLogo, Colours, ImagesRED signifies leadership, vitality and passion . The GREEN signifies coffee growingheritage and the coffee plantations that they own. WHITE SWIRL signifies purity ofpurpose, invigorating properties of growing coffee.Café - larger than the text inside the logo box.Signifies that Café Coffee Day pioneered the café concept in India way back in1996.C.C.D. will like to own the word “café” in the minds of its customers.Décor & ArchitectureLiterature New LogoDress Code Xcellon School of Business Management, Ahmedabad. Page 57
  58. 58. SWOT ANALYSIS OF CAFÉ COFFEE DAYStrengthExcellent brand name and brand visibilityHuge young crowd as target groupExcellent ambience and serviceOver 1000 outlets and 300,000 visitors per dayIt produces/grows the coffee it serves hence reducing the costProducts of extremely good quality and taste.Its a youth oriented brand , hence huge potential since 40 % population is below 20It produces/grows the coffee it serves hence reducing the cost.USP of brand is it’s considered a highly affordable brand.WeaknessCrowd managementImproper sitting arrangementLacks strength to maintain brand loyaltyFollow the competitor strategyWeak brand image and lacks strength to maintain brand loyaltyPoor ambience and decor. CCD outlet served prime space for advertising andpromotionsMany of the CCD stores are incurring loses due to wrong site selection.OpportunitiesIntroduce cheaper versions of coffeeTap the smaller towns/citiesMerchandising.Tie ups with other companies for promotionCoffee cafe industry is one of the fastest growing industries in Asia.More people like to visit CCD for informal meetings.CCD has gone international, and is planning to attract many new international markets,hence gaining international recognition Xcellon School of Business Management, Ahmedabad. Page 58
  59. 59. ThreatsEntry of foreign players like star bucksDependent on Govt commodity ratesLarge unorganized marketCompetition with other coffee cafes like Barista, Mochas. Competitor Barista- This is the closest competitor to Café Coffee Day in the Indian market.. But Barista is often viewed as a place to unwind after a hard day’s work or an ideal setting for a business meeting. Café Mocha- This aims at providing a level of experience to the consumer which is hard to imitate.. Mocha calls itself ‘a coffee shop for the soul’. Qwicky- Based mainly in Bangalore, Qwicky has a strong local hold in South India.CAFÉ COFFEE DAY IN COMPETITIONIf you are talking about Cafe Coffee Day as meeting place then the park bench is theircompetitor, if you are talking about in terms of food and chain then McDonalds is acompetitor and so are other coffee chains like Barista And Mocha. In fact they areaiding each other in creating and growing the coffee culture. They are not trying to besome one else. They are not trying to be an upper class coffee shop where you canwalk in only if you have certain amount of money in your pocket. These are the upperend coffee shops that have hookahs and the works.They are about an every day hang out. They are about being the third most frequentedplace after home and workplace or college. So they are like the coffee chains overseasbut with about affordable fun. They have a distinct identity; they are about coffee andabout hanging out and about nice time spend. Xcellon School of Business Management, Ahmedabad. Page 59
  60. 60. HYGIENE & FOOD HANDLINGEmployees use tongs or wear gloves to handle food items. They cannot USE BAREHANDS.Cutting Boards and knives to be washed and wiped dryevery hour.They always have to use clean and dry plates and bowls, cutlery while serving food.Clean the refrigerators before opening, and while closing.Cannot use chipped plates, cups.Cant open the mineral water bottle, tomato sauce sachets, before and also at the time ofserviceThe racks (where crockery are kept) should always be clean.Pantry area should be clean and dry all the time.Food Usage:Use first in rust out method.Order on a day-to-day basis.No food should be kept beyond the shelf life.The display has to be clean all the time.Only the fresh food received has to be used for display.Stack foods neatly on display plates.All the food, which is supposed to be microwave, has to have a paper underneath andthen transferred to a new plate.All items stored at room temperature to be covered at all times either by a toed cover orwrapped in cling film.All the cakes will be cut when they are received in the morning by the cafes.A clean knife dipped in hot water and then wiped to be used to cut the cake. Rinse theknife after each cut with hot water.The appropriate cutlery and accompaniments have to be provided along with the food.The food should not be heated along with the cling wrap.The food has to be taken care of while packing up the food for parcel order.Thumb rule to be followed while storing food in the coolers. (Display as well as backup ones) (All the pastries on the top shelf the vegetarian Savories on the centre and thenon-vegetarian Savouries’ on the bottom shelf.)Reject food items which appear damaged while receiving food.Date/Colour code stickers should be placed on all food. Xcellon School of Business Management, Ahmedabad. Page 60
  61. 61. COMPENSATION & BENEFITS PAY PERIOD:Café coffee day’s employees are paid on a monthly basis. One shall receive one’s pay bythe seventh working day of the subsequent month. One can access salary slip by loggingonto cafécoffeeday.com/attendence, when the window opens click on the “GO” button.One will have to enter the user name and password. One’s employee code is the user nameand password by default. Once login they can change the password by using the changepassword option. MEDICAL INSURANCE POLICY:Café coffee day had a tie-up with insurance agencies with policies such as the grouppersonal accident insurance and group health insurance policy. This is only applicable toemployees who are conformed in the organization. Details of the same can be availed fromHR department. STATUTORY DEDUCTIONS: EMPLOYEE PROVIDENT FUND:All full time employees who are appointed on the company’s rolls are eligible for theprovident fund schemes, which is a social security fund payable to on retirement. As perthe provisions, employees must contribute 12% of their basic salary and an equalcontribution will be made by the employer.The nomination form {Form 2} is filled at the time of joining. Yearly returns will beprovided. Please collect PF number from regional HR resource. It may take around 15- 20days from the time of filling and submitting the form. EMPLOYEES STATE INSURANCE:This is provided to employees who’s gross salary is Rs 7500/- p.m. or less and the benefitsprovided under the scheme are for sickness, maternity etc. the employee has to contribute1.75% of his gross salary and the employer contributes 4.75% of the employee salaryunder the scheme. The completed ESI form along with two post card sized full lengthphotographs should be submitted for ESI registration. Please collect ESI card number fromregional HR resource. Xcellon School of Business Management, Ahmedabad. Page 61

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