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Transcript of International Marketing
In 1970-80s it transformed into vast industrial complex;
Opened branches in Paraguay, Uruguay, Brazil and Chile (total 41 branches);
Brazil – largest distribution center in the country consolidating its position in Latin American market;
In 2002 it opened a branch in Barcelona to expand further in Europe, Africa and Middle East;
In 2004 by merging with Danone it became the biggest biscuit company in South America (41% Danone and 59% Arcor). What would be the major obstacles to Arcor's attempt to penetrate markets outside Latin America? Question 1 How could Arcor use the concept of the virtual value chain to increase internationalization? Question 2 Where are Arcor's competitive advantages in the value chain? Question 3 strong position in Latin America;
if market research is effectively done, obstacles can be overcome;
Arcor can succeed in their international expansion process if they effectively use the virtual value chain and exploit the competitive advantages they already have.
Effective ways of using the virtual value chain Reducing costs:
eliminating unnecessary and wasteful steps and activities -> simplifying -> automating - all in order to provide lower costs and higher quality to their customers;
Offering products and services:
sharing knowledge and information with partners and suppliers and create strong relationships with the consumers to enhance customer satisfaction;
Inventing new products:
use information and alliances to innovate, provide different services and use emerging technologies. Major obstacles Competition (strong market share and brand recognition for other products);
Cultural differences (language);
Different trends, demands and attitudes;
Higher costs (energy levels, high distribution costs due to large geographical distances);
Different pricing strategies;
Different local laws and regulations. Competitive advantages in the value chain R&D:
cutting edge technology;
developed high degree of know-how over time;
largest product distribution in the country;
owns the most advanced chocolate plant;
alliances for production (Danone, Nestlé).
marketing agreement (with Danone -> Bagley Latinoamerica);
the first food industry website in Latin America for B2B markets– www.arcorsales.com;
Sales & Service:
consolidated position in Latin America (95% of the revenue);
widest product portfolio in the bakery and confectionery market (more than 1500). But what is the virtual value chain? Virtual value chain = extension of the conventional value chain, where the information processing itself can create value for customers. Challenges for expansion To become no.1 Latin American chocolate company;
To grow and establish in potential high development markets of US, Europe and Asia;Strengthen product penetration in the most demanding markets of the world.