International Marketing Assignment: Recommending Market Entry Strategies to Pro-Way Livestock Equipment

Question

Task: International Marketing Assignment Task Description
Assessment Task is designed to support students to be practical in applying international marketing theories/concepts in their workplace. Building on the Environmental Analysis of Pro-Way Livestock Equipment, this task requires students to prepare a report on recommendations involving the decisions regarding (a) market selection, (b) mode of entry, (c) competitive strategies, and (d) marketing mix strategies and present the findings.

Answer

Executive summary
The aim of this report on international marketing assignment is to provide recommendations to the organizational leaders of an Australian based firm known as Pro-Way Livestock Equipment. The firm wants to expand its market in the US and UK market and the recommendations are related to adoption of strategies that can help the firm to sustain in the above-mentioned markets. In the first part the growth of Livestock Equipment market in the USA and UK market has been predicted and this can help the organizational leader grab relevant opportunities. In the second section, exporting and green field investment strategies are suggested for entering in to these markets. Since, areas like Iowa and California in the US region are widely practicing farming activities therefore, Pro-Way can use focus competitive strategy. On the contrary, for expanding in the UK market differentiation focus strategy has been recommended.

Furthermore, in both the market the organization can adopt competitive pricing strategy and should focus on promoting through the visual, print and digital media to increase the reach of the product. ?

Introduction
In the competitive business environment, it is the responsibility of organizations across the world to expand their business. Foreign entry or entering into a new market can be considered as one of the effective strategy that can help a firm optimize their productivity. The aim of this report is to recommend the market selection and mode of entry strategy for Pro-Way Livestock Equipment that can further help the organization to optimize their revenue. This organization is based in Australia and is well-known for selling products that can be used for livestock handling, cattle and sheep yards and many more.

Market selection
The process in which a firms analyze a profitable market for the purpose of investment is known as market selection. Market selection is considered to be one of the important mechanism that helps in analyzing the productivity growth of a firm (Dosi, et.al., 2015).Pro-Way Livestock Equipment can expand their operation in the markets of UK and USA. This expansion can help them to achieve financial goals and the firm can also compete in the global market. Expansion in the UK market is considered to be one of the beneficial and effective strategy for the organization because, UK is one of the developed nation across the world. It is found that the British farmers in the country side of the UK region is serving the whole world. Moreover, the agricultural equipment sector has witnessed a growth in CAGR by 3.4% from 2017 to 2019 (Grand view research, 2020).It is also expected to grow by 6.1% from 2016-2026. Currently the leading players in the UK market are GCO, CNH Industrial and many more (Mordor Intelligence, 2021).Therefore, Pro-Way can grab various opportunities from the market that can be further used for the purpose of optimization of profit and it can also help the firm to compete in the global market.

Source: Mordor Intelligence, 2021

In addition to this, the organization can also select US market for expanding its business. It has been found that 29.5% of the total market share is hold by US. US has also faced issues in the farm and livestock equipment market in the global pandemic but this market will also grow in the coming decade which will open major opportunities for the organization who are operating in this sector (Intrado, 2021). Furthermore, the Cattle market is dominating in California, Texas, Kansas and Nebraska. Therefore, opening stores in these areas of USA can also bring major opportunities and increase the volume of the sales of the equipment that are offered by Pro-way. Thus, it is highly recommended to the organizational leaders of the company to focus on analyzing the market segment within the US market to increase the efficiency of the performance of the organization in the international market. The following image shows how the growth of agricultural sector in US has added value to the GDP of the country.

Source: USDA, 2021

Mode of entry
There are various entry modes for ProWay Livestock Equipment for entering US and UK markets. The company is involved in the business of designing and manufacturing livestock handling equipment and facilities for the clients. Thus, the two modes of entry that it can consider are exporting and Greenfield Investment. ProWay manufactures equipment based on the capacity, onsite and operation requirements for the clients, which indicates its tailor-made equipment (ProWay, 2021). Thus, it can export such equipment and facility products to the US and UK clients based on their specific requirements. In this regard, the company can come across both advantages and disadvantages associated with this exporting mode of entry in the foreign markets. Exporting refers to the marketing and direct selling of domestically manufactured goods in a foreign market (Hollender, Zapkau&Schwens, 2017). In this case, ProWay will produce the equipment and facilities in Australia itself and directly sell them to specific clients in the two foreign markets. The company would not have to bear any investments for foreign production facilities, only the costs of marketing and advertising. Some of the advantages include protecting its patents, trademarks and goodwill, having foreign representatives and lesser investment (Gillespie& Hennessey, 2015). However, it can face limitations of high costs due to offline products and increased lead time for market research, scoping and hiring. Furthermore, ProWay can undertake the entry mode of Greenfield Investment for setting up wholly owned subsidiaries in UK and US markets. In this way, the company would be able to produce its livestock equipment and handling facilities in the foreign markets based on the clients’ requirements by constructing manufacturing facility, sales office and others (Stepanok, 2015). It can gain various advantages from this entry mode including higher level of control over business operations, increased quality control over product manufacturing and sales, staffing and brand image, achieving economies of scale, overcoming trade restrictions and creating job opportunities. However, ProWay might also have to deal with some challenges (Gillespie& Hennessey, 2015). In this regard, the company should first assess and devise strategies for managing risks, estimate budget for market entry costs, understand the government regulations in the foreign markets and analyze all fixed costs involved.

Competitive strategies
Strategies adopted by an organization to gain competitive advantage in a market is known as competitive strategies. It is the responsibility of an organization to focus on forming customer-specific or industry-specific services or products that can increase the level of satisfaction of customers that can further help the firm to gain competitive advantage (Cusumano, Kahl&Suarez, 2015). If the UK market is taken into consideration it can be seen that large number of organizations are operating in the livestock and farm equipment. British Pig, BCF Technology and many more are considered to be the large players. Thus, it is highly recommended to Pro-Way to develop a competitive strategy that can help the firm to provide unique equipment and unique solutions to the stakeholders of the agricultural sector.

Thus, it is recommended to the organizational leaders of Pro-way to undertake Differentiation focus competitive strategy. The objective of this strategy is to implement an additional value to the products or the services that are being offered to the customer (Linton&Kask, 2017). In the current scenario, constant degradation of the environment, change in climate and societal conditions have become a major of concern for external and internal stakeholders of firms across the world. This concern can be considered as an opportunity for the leaders of Pro-Way. The manufacturers of the equipment can focus on producing equipment that can further help the farmers of the organization to focus on sustainable farming. This unique feature of the equipment can help the firm to sustain in the competitive market of UK. In addition to this, if the US market is taken into consideration it can be seen that Farm equipment industry is strong in specific geographical areas like California, Iowa and many more. Therefore, it is recommended to the organizational leaders of Pro-Way to adopt focus strategies to fight with the competitors in the US market. When a product is sold in a niche market it is known as Focus strategy. In this scenario, geographical area is considered to be the niche market. Focus strategy has a positive association with the performance of the organization (Devakumar&Barani, 2016). Therefore, this strategy can optimize the performance of the Pro-Way if they target specific geographical areas.

Marketing mix strategies
The objective of this strategy is to use tactical tools for marketing that further help an organization to increase the reach of their product or service to more number of customers in a new market. The objective behind implementation of marketing mix strategies is to help the firm survive in the competitive market (Syapsan, 2019). The following part focuses on analysing the 4ps that can help Pro-Way to implement effective marketing mix strategies within the organization.

Product
It is highly recommended to the product manufacturing team of the organization to focus on adopting sustainable strategies. The equipment should be built in such a way so that it can help the farmers of the UK and the US market practice farm sustainability. Farm sustainability is considered to be an important process where tools and techniques are used by the farmers for farming that has less negative impact on the environment.

Price
It is recommended to the organizational leaders of Pro-Way Livestock to focus on adopting competitive pricing strategies while expanding its operation in the UK and US market. This pricing strategy is considered to be important because it increases the willingness of the customer to pay and also increases the level of satisfaction of the customers (Hallberg, 2017). Competitive pricing strategies is recommended to the organizational leaders of Pro-Way Livestock because this strategy can help the firm to grab more number of customers and gain competitive advantage.

Place
It is highly recommended to the organizational leaders of Pro-Way Livestock to start its operation in specific areas in USA that includes California, Nebraska, Iowa and many more. On the other hand, the leaders of the organization should focus on starting its operation near the country side of UK because farming tends to take place near the country side.

Promotion
Promoting the product is considered to be one of the important aspect of marketing strategies. This is considered to be one of the key success factors because it has an impact on the sales of an organization (Fan, Lau & Zhao, 2015).The organizational leaders should focus on print and visual media campaign. Apart from that in the digital era they can also start campaigning products in the digital media that can attract more number of customers from the UK and the US region.

Conclusion/Findings
The aim of this report was to focus on recommending effective marketing strategies to an organization named Pro-Way Livestock Equipment based in Australia who wants to expand its business operations in the UK and US market. The report suggests that exporting the products and greenfield investment can be taken into considerations for expanding its operation in the UK and US market. From the report it can be found that Pro-Way has been recommended to adopt focus strategy and differentiation focus strategy for achieving competitive advantage.Moreover, the report concludes that the organizational leaders should focus on developing innovative product and promote it into the local market to gain competitive advantage.

References
Cusumano, M. A., Kahl, S. J., & Suarez, F. F. (2015).Services, industry evolution, and the competitive strategies of product firms. Strategic management journal, 36(4), 559-575. 10.1002/smj.2235

Devakumar, G., &Barani, G. (2016). Marketing strategies for competitive advantage: structural equation modelling approach on agricultural sector industry in South India. International Journal of Business Excellence, 9(2), 225-239.

Dosi, G., Moschella, D., Pugliese, E., &Tamagni, F. (2015). Productivity, market selection, and corporate growth: comparative evidence across US and Europe. International marketing assignmentSmall Business Economics, 45(3), 643-672.

Fan, S., Lau, R. Y., & Zhao, J. L. (2015). Demystifying big data analytics for business intelligence through the lens of marketing mix. Big Data Research, 2(1), 28-32. http://dx.doi.org/10.1016/j.bdr.2015.02.006

Gillespie, K., & Hennessey, H. D. (2015).Global marketing.Routledge.

Grand View Research, 2020.Livestock Farm Equipment Market Size, Share & Trends Analysis Report By Product Type, By End Users, By Region (North America, Europe, Asia Pacific, Latin America, MEA), And Segment Forecasts, 2020 – 2027. Retrieved from https://www.grandviewresearch.com/industry-analysis/livestock-farm-equipment-market

Hallberg, N. L. (2017). The micro-foundations of pricing strategy in industrial markets: A case study in the European packaging industry. Journal of Business Research, 76, 179-188.http://dx.doi.org/10.1016/j.jbusres.2017.01.001

Hollender, L., Zapkau, F. B., &Schwens, C. (2017). SME foreign market entry mode choice and foreign venture performance: The moderating effect of international experience and product adaptation. International Business Review, 26(2), 250-263.

Intrado, 2021.Global Autonomous Farm Equipment Market to Reach US$199.8 Billion by the Year 2027.Retrieved from https://www.globenewswire.com/news-release/2021/07/19/2264652/0/en/Global-Autonomous-Farm-Equipment-Market-to-Reach-US-199-8-Billion-by-the-Year-2027.html Linton, G., &Kask, J. (2017).Configurations of entrepreneurial orientation and competitive strategy for high performance. Journal of Business Research, 70, 168-176.http://dx.doi.org/10.1016/j.jbusres.2016.08.022

Mordor Intelligence, 2021.UNITED KINGDOM AGRICULTURAL MACHINERY MARKET - GROWTH, TRENDS, COVID-19 IMPACT, AND FORECASTS (2021 - 2026). Retrieved from https://www.mordorintelligence.com/industry-reports/uk-agricultural-machinery-market

ProWay, 2021.Our Approach. Retrieved from https://proway.com.au/about-our-approach/our-approach/ Stepanok, I. (2015). Cross?border mergers and greenfield foreign direct investment. Review of International Economics, 23(1), 111-136.

Syapsan, S. (2019). The effect of service quality, innovation towards competitive advantages and sustainable economic growth: Marketing mix strategy as mediating variable. Benchmarking: An International Journal, 26(4), 1336-1356.https://doi.org/10.1108/BIJ-10-2017-0280

USDA, 2021.Ag and Food Sectors and the Economy.Retrieved from https://www.ers.usda.gov/data-products/ag-and-food-statistics-charting-the-essentials/ag-and-food-sectors-and-the-economy/