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GWave Consulting Report:
By: Brian Neves and Jason Moehle
Mentor: Dr. Massood Samii
“Exploring the UK as a Potential Customer”
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Disclaimer Page
DISCLAIMER This material is based upon work supported by SNHU students. Any opinions,
findings, conclusions, or recommendations are those of the authors and do not reflect the views
of its employees or its administration.
Executive Summary
G-wave company debuted in 2005,with CEO Robert Stoddard in charge currently. This company
is one of the highest performing cost effective energy based technologies in its industry. The G-
wave pendulum designed system uses the force of the ocean's waves and currents to produce this
cost effective sustainable energy, consulting Gwave on penetrating the UK market would be a
favorable investment.
Introduction to the Report
Our group has been presented with the task of creating a consulting report for GWAVE
corporation’s international expansion. The United Kingdom is the market that we have
targeted to as it has the most ideal characteristics for what GWAVE hopes to achieve
through expansion overseas.
The results of this report have come from the implementation of the Porter’s Five Forces
Model. What we have found through careful research of the United Kingdom as a target
market is as follows. The United Kingdom is actively seeking alternative forms of
energy, which we believe GWAVE is the best suited to address this need. This is
accredited to the vast amount of coastal regions coming from the United Kingdom being
an island land mass. The United Kingdom is also benefited with a strong economy, thus
it is feasible for the nation to take on the large initial investment accompanied with this
newly developed technology.
As GWAVE intends to utilize a licensing model with the development of their product,
the United Kingdom offers attractive characteristics in the implementation of this. With
the size of the shipbuilding their shipbuilding industry, it is clear that the United Kingdom
has the resources and technologies in order to build the vessels which make up the
infrastructure of the power grid.
The United Kingdom currently has no sustainable offshore renewable energy projects
currently being implemented. This offers GWAVE a great opportunity control the market
share in the nation, which will allow the company to expand to new markets as a result
of their proven capabilities.
Background
Gwave is a really interesting business idea with the aim to develop something
that will be very helpful in the future. The company was originally created in 2005 with
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the aim to develop and license vessel- based technology to convert ocean wave energy
into grid-scale electrical energy at delivered costs. In addition to that, Gwave is the only
company based on ocean-based energy technology and the competition is with other
companies who are using coal, gas, oil providing electricity to the community along with
environmental issues and great amounts of money to pay every month. Through that,
Gwave is able to compete in the market, providing a solution for the world’s growing
power requirements.
On the other hand, every company when they go in the market, they must have
an advantage in order to compete with the other products. In particular, Gwave has
economic advantages from its competitors including capital costs similar to coal, with no
fuel costs since Gwave is a renewable energy. Also operating costs are less exposed to
the market and risk is maintained as well. Another important advantage is the fact that
there is no pollution in the environment which results in no pollution costs or any taxes
regarding pollution.
However, unlike other energy technologies, Gwave operates at utility scale and
produces more energy per unit. Along with that the movement of the vessel in the ocean
adjusts to wave conditions in real time. Overall, Gwave is a great business idea with the
background of the business to be efficient for the future.
Porter’s Five Forces Model
1. WHICH: GWAVE should focus on the following activities when moving overseas,
based upon the value chain analysis. Because of their focus on creating a
licensing model, very few responsibilities will be transferred outside of the direct
control of GWave (Van Bever, 2015). This function is most beneficial for GWave
in reducing risk factors because there is no direct investment being made. As the
company is shifting into the sales phase of their product, sales teams will be
beneficial in collecting data and communicating with potential buyers.
2. WHY: The market for renewable offshore energy has not been established in the
UK yet. This indicates that GWave has the potential for growth and increase in
sales, while it begins to dominate the growing market. The UK has some of the
best tidal and wave power resources in the world. There is no commercial project
in the UK that has been installed and is harnessing tidal energy or wave energy.
The UK also has an established research and development organization that has
a leasing process to offer potential developers the opportunity to secure seabed
rights for tidal range products in the UK.
3. WHAT: England happens to be one of the world’s most famous and wealthiest
countries. The main industries in this country are banking/finance, steel, oil/gas,
and tourism (Tourism, 2015). Tourism in England is where this country tends to
rise on top with compared to the other industries. The worth of this industry is
$127.9 billion and employs more than 1.5 million people in various sectors of this
industry such as hotels, restaurants, pubs, travel agencies, museums
etc…(Tourism, 2015). On average, about twenty five million people from various
locations around the world visit England to see what this prosperous and
favorable country has to offer. England is right on the coast and is not a
landlocked country which makes it advantageous for this company to easily plant
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these innovating machines right off coast. When it comes to operating
internationally the question of, “What is the best way to operate international?”
comes about. Following the laws and business etiquette is essential when doing
business in another country. The business etiquette that you use is very
important when trying to get a deal going with an international company, and in
this case the wave company. When it comes to doing business transactions with
England it is always essential to maintain eye contact without looking down
because this is considered a sign of disrespect, and could ruin the chances of
getting business with a certain country, and in this case England. It is extremely
important to always read up on the country in which one is doing business in,
because one small mistake in the business etiquette of the meeting and the deal
could be called off. This aspect of proper business interaction on an international
level is one of the key points in answering the question of how to operate
successfully on the international playing field. When it comes to what type of
structure GWave should implement, they should consider implementing a
partnership. A partnership can be extremely advantageous in ways such as the
old saying “two heads are better than one”, as well as how the business is much
easier to establish in terms of startup cost being low. G wave would benefit from
the limited external regulation that would come along from a partnership which is
favorable. Licensing is another vital component that G wave must take into
thought because when customers see that the company has official licenses the
customer/potential clientele will be more inclined to purchase the product
because of the professionalism behind the licensing, and licenses provide more
authenticity which is another factor that will make the company more favorable.
4. WHEN: Britain is an important market segment for GWAVE products.
Indisputably, Britain is an industrialized economy with energy demands of more
than 65% in the industry sector and more than 15% in households (Energy UK
2015). Electric energy in Britain comes from a mixture of sources such as
nuclear which accounts for 15%, fossil fuel which account for more than 45% and
renewable energies which account for 5% of the sources of electric energy in the
country (Energy UK 2015). In this regard, Britain relies heavily on fossil fuels
such as coal, natural gas, and oil for electricity generation. Renewable energies
include waves, solar, biomass, hydro, marine, and wind which account for less
than 10% sources of electricity energy (Energy UK 2015). This demonstrates
that renewable sources are underexploited in Britain market. The wave market
segment is below 2% which means that a new entrant into this market would still
enjoy first-mover benefits. In this regard, G-WAVE should enter Britain market
now in order to develop proprietary and technological leadership, establish entry
barriers, and become one of the dominant firms with a bigger market share
compared to late entrants (Peng 2014). The other benefit is that the company
would be in a position to establish key relations with important stakeholders such
as relevant government agencies to necessitate its operations in a foreign
market. In the same perspective, G-WAVE would have numerous benefits based
on different option strategies such as flexibility to adjust scale depending on
market demand and the level of competition from late entrants (Peng
2014). These are vital considerations that would ensure that the company
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succeeds effectively in Britain wave market which is greatly underexploited as a
renewable source of energy.
5. WHERE: The UK is currently seen as a world leader and focal point for the
development of wave and tidal stream technologies because it has an
abundance of marine energy resource (Wave and Tidal Energy, 2013). This
factor makes an ideal match for GWave to target the UK to further negotiations.
While previous sites such as the Mersey, the Solway Firth, and the North Wales
Coast have been identified for other projects, GWave should look toward other
regions of the UK. The reasoning for this is the vast amount of offshore area that
GWave requires in developing their power grids. Because of this, the
Southwestern coast of the UK is an ideal target, whereas the other locations do
not offer the amount of area required. A development site, called Wave Hub, is
already in place in Cornwall for the production of offshore energy.The benefit of
this is the ground work that has already been put in place with the UK
government. Wave Hub was granted consent in 2007 under Section 36 of the
Electricity Act 1989. This allows different wave energy generation technologies to
be deployed at the site (Wave Hub).
SWOT Analysis
Strengths= G wave has strengths in the uniqueness of their product. G wave happens
to be one of the only cost effective, ocean based energy technology that is use as of
right now. No other companies have such technology which is what makes this
company stand out from the rest. The way that the movement from the ocean/waves
influences the creation of low cost, efficient energy is an innovating concept that is both
genius and resourceful not to mention how it doesn’t affect the environment like many
other companies tend to do.
Weaknesses= G wave can face a numerous amount of weaknesses that may affect the
company in a negative way. Starting up a business can usually take anywhere from 10-
13 days which may not seem like a substantial amount of time but the amount of steps
involved in setting up a business/business agreement in England can make the process
of being established quite tedious. Construction permits and getting electricity in
England can also be a process. In order to get the right construction and electricity
permits it usually takes anywhere from 90 to over 100 days to obtain, the rates of these
permits also run extremely high in England (Top ten challenges, 2015). When it comes
to the biggest weakness of doing business with England is registering property so in this
case the vessels itself. The process of registering property requires six procedures and
29 days of searching for a property to commence the business (Top ten challenges,
2015).
Opportunities= G wave has many opportunities especially doing business within the
country of England. England is very big into renewable energy when it comes to
onshore wind turbines, offshore wind turbines, and wave/tidal energy. By building upon
the current “established marine engineering heritage, marine energy could lead to
significant economic growth for the UK” (RenewableUK, 2015). G wave could possibly
form business relationships with other renewable energy efficient companies, by coming
together with another company doing similar business practices the potential for an
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increase in market shares and for a better company in general is without a doubt
possible.
Threats= When it comes to threats G wave may obviously face other similar companies
trying to reproduce the same idea with a different twist.
Future growth of Sustainable Energy
UK is on track to meet its renewable energy targets. The use of gas has steadily fallen since
2005, in which sustainable renewable energy has taken its place. Currently, about 15% of UK
electricity comes from renewable resources. Onshore and offshore wind farms have been
growing tremendously, in which these resources are generating more than half of the UK’s clean
electricity
G-wave partnership with company
Gwave has proposed to joint venture with wave hub a reusable energy company based in
England. G-wave technologies along with others are being tested and perfected by companies
such as Wave Hub.
Conclusion
By entering the United Kingdom market through a joint venture with Wave Hub, GWave will be
able to do the following:
1. Generate funding that will add value to the company
2. Bring global awareness to the innovative technology that GWave has developed in the
renewable energies field which can then,
3. Create further negotiations within the United Kingdom, as well as the rest of the
European Union, for the development and implementation of GWave’s technology
Work in progress; Case study
The research our group did will be used in future classes here at SNHU. Basically, we will
transform this research into a case study for Dr. Samii to use in his future International Business
courses.
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References
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demand/
Portilla, Jesus, Jeison Sosa, and Luigi Cavaleri. 'Wave Energy Resources: Wave Climate and
Exploitation'. Renewable Energy 57 (2013): 594-605. Web.
RenewableUK | Wave & Tidal Energy. (n.d.). Retrieved October 25, 2015, from
Tourism in England and the UK. (n.d.). Retrieved October 21, 2015, from http://resources.woodlands-
junior.kent.sch.uk/customs/questions/tourism.htm
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2015 Update on Progress Towards 2020 Renewables Target
