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Global Marketing Plan - Pyramids Restauraunt - International Buisness 2016
Transcript of Global Marketing Plan - Pyramids Restauraunt - International Buisness 2016
• High number of restaurants (strong force)
• Low switching costs (strong force)
The restaurant industry in China shows an aggressive competition either from local or Foreign Firms working in restaurants, especially fast food firms like KFC and MacDonald's.
There are a huge number of foreign restaurants in China; the most popular are the American restaurants that are most favorable to the Chinese people.
Also there are the Brazilian, Thai, Italian, Indian,
Bargaining power of buyers or customers
The customer has high Bargaining power as they can switch with low cost from one restaurant to another either from the western restaurants or Middle East restaurants (Turkish, Morocco, Lebanese,..)
Bargaining power of suppliers
Restaurants raw material has large number of suppliers that weaken the supplier bargaining power
Threat of substitutes or substitution
The consumer has different substitutions for the Egyptian food as the availability of Middle East restaurants
Threat of new entrants or new entry -Medium-
Moderate force as the consumer switching cost is low and new restaurant capital cost is moderate
I. Company Profile
ii. 7 P's Company Point of view
iii. 4 C's Customer Point of view
II. Foreign Market Analysis
i. CHINA PESTEL Analysis
ii. RUSSIA PESTEL Analysis
iii. Country selection Decision
iv. Cultural tips
IV. Market Situation
V. Developing Marketing Strategy
v. Industry analysis (Porter 5-forces)
vi. SWOT analysis
I. Company Profile
to be always the desired place for great cultural flavored meals
Pyramids Restaurants hold in every Corner an essence of the EGYPTIAN culture, the flavour of our land, the passion of perfection, an obsession to produce only the purest and authentic Egyptian Food
1-Increase Chinese awareness by Egyptian culture
2-Attract more Chinese to Egyptian tourist markets (10,000 tourist for 1st year ,150,000 Tourists within 5 years
3-Enjoy the first mover advantage in china markets and gaining 5% of market share by 1st year ,25 % by 5Th year
" It is through our marketing strategy that we hope to achieve these goals in particular through our promotion strategy, Promotion will be the key factor of increasing Egyptian cultural awareness"
The advantage that pyramids restaurant have in shanghai that after surveying people we found out that there is no specific age or gender in our market segment, however we will focus on certain social level class A and B and youth and families and groups.
Pyramids restaurant is aiming to be perceived as Essence of the Eastern Egyptian Civilization
Global Marketing plan
II. Foreign Market Analysis
MODE OF ENTRY
The market entry strategy will be Joint venture with local partner due to:
2-Local partner to facilitate learning about cultural differences
3- To mitigate new market entry risk at the introduction stage
4-joint venture allow to control over the robust control to Chinese labors
The literacy rate in China is over 90%.
The first language is the Chinese national language, English speaker only 0.7% of the whole population around 10 million
Religions: Buddhism (50%), Taoism (30%), and Chinese folk religions & others (Muslim 1.5-2%,Christian 3-4%)
The average income in east china is 2.26 times than west of china.
Chinese prefer first mover.
Business lunches have become popular.
China holds state of the art technology and they are able to make the technology cheap.
Transport in China has experienced major growth and expansion in recent years. Airports, roads, and railway construction will provide a massive employment boost in China over the next decade.
China possesses a diversified communications system that links all parts of the country by Internet, telephone, telegraph, radio, and television.
Over reliance on coal which produces acid rain.
Climate vary from region to region
Natural disasters (floods, earthquakes)
Sixteen of the world's twenty most polluted cities are found in China, Government response has been criticized as inadequate, An official report released in 2014, found that 20% of the country's farmland, and 16% of its soil overall, is polluted. An estimated 60% of the groundwater is polluted.
China has high GDP annual growth rate averaged 10.8 % since 1989 till 2015, and ranked as 2nd GDP in the world 11,348.8 USD
China GDP per Capita , according to the world bank report the trend of chine GDP per capita showing a sustained growth since year 2000 till now as it reached $7590 by year 2014
China has unemployment rate 6.1% and inflation rate 3.2 %.
China considered as a stable political country, with centralized unitary government.
China has a single party "China communist party, CCP", also one legislative house "Parliament".
The president of PRC "people's republic of china" is the head of CCP, Parliament and Army.
After the Egyptian revolution in 30/6/2013, China considered as one of the biggest supporter to the new government and the new Egyptian president, last week 19th of January 2016 a China president visited Egypt to improve and develop the relation between two countries.
Protests against the political system and constitution is not tolerated – dissidents are prosecuted .
In an effort to encourage inward flow of funds, technology and information, China provides numerous preferential treatments in foreign taxation, and has successively concluded tax treaties with 60 countries (by July 1999): Egypt is one of these countries.
Special Economic Zones (SEZ) were created to encourage FDI - Shenzhen, Zhuhai, Shantou, & Xiamen
Firms located in SEZ can benefit from low cost of labor, tax exemptions, duty free imports of raw materials and technology
Population in 2015 was 142,098,141 with 75% URBAN
Literacy level is 99,4%;
54% of the Russian labor force has attained a college education, giving Russia the highest attainment of college-level education in the world.
They read a lot, books are cheap, and every one can afford to buy 5-10 books a month without serious damage to a family budget.
They enjoy attending theatres: opera, musical, ballet, drama etc.
There was no private property until Perestroika, everything used to belong to the state.
Cultural values are changing rapidly under the pressure of the Western ones
Low productivity level in comparison to other countries;
Languages: While Russian is the official language, many Russians also speak English as a second language.
Religion: More than half follow the Russian Orthodox Church, according to the Ministry of Foreign Affairs of the Russian Federation. Islam is the second largest religion; about 10 percent to 15 percent of Russians practice Islam, according to the CIA World Factbook.
65% of Russians use Internet every day.
Wide spread of piracy.
The country's IT market is presently the fastest-growing in the Central and East European (CEE) region.
The lack of infrastructure investment over the last 10 to 20 years has dropped Russia to 93rd globally in quality of overall infrastructure in The Global Competitiveness Report 2013–2014 prepared by the World Economic Forum. China and India are placed at 74th and 85th, respectively.
Only the quality of railway infrastructure in Russia comes in at a relatively high level (31st). All other areas (quality of roads and highways, quality of port infrastructure, quality of air transport infrastructure and quality of electricity supply) need improvement.
High level of pollution, 50% of all water in Russia is now polluted; Russia’s air is among the most polluted in the world.
A lot of natural resources (oil, gas, metals, wood, water etc.);
Weak environmental legislation for plants and production facilities in comparison with Europe
In general, the climate of Russia can be described as highly continental influenced climate with warm to hot dry summers and (very) cold winters with temperatures of -30°C and lower and sometimes heavy snowfall.
Russia depends mainly on the natural resources (oil and gas)
Economy sensitive to price of crude oil.
Average inflation rate 15.7% over year 2015
12, 7% of population is below poverty line (impact of market size).
GDP growth rate is below 2% since last 5 years except last year it got worse due to dramatic decrease in oil price
It is expected to have this continue in 2016 due to decrease in oil price and war in Syria.
The Federation of Russia came to existence as a legal successor of Soviet Union since 1993.
The Dominant leader of Russia is the current president Vladimir Putin who started as president since year 2000 for two terms then prime minster then once again in 2012 as president.
Unstable political relationship between Russia and Europe since intervention of Russia in Ukraine 2014.
Good Relation between Egypt and Russia after 30/6 Egyptian revolution.
Unstable relationship with most of Arabian gulf countries and Turkey due to intervention in Syria 2015.
Freedom of speech issues (might affect advertising campaigns).
According to the transparency international organization, in 2014 the corruption rate of Russia is staying at the rate of 2.1 which consider as one of the country which have very high corruption rate.
In order to attract more investment, the government pass the law which make no different between foreign investors and national investor.
Labour laws - Freedom of employ any personnel of their choice regardless of their nationality
One of the lowest tax rates 18% VAT relative to europe
III.Foreign Marketing Entry Strategy
1- This restaurant will be the first mover pioneer of Egyptian oriental food in China.
2- Differentiated service through introducing the Egyptian cultures within same restaurant premises and without extra cost.
3- Partnering with Big domestic restaurant firm that help learning well of Chinese consumer behavior.
The Egyptian management team ability to communicate with either Chinese consumers or their Chinese labors in restaurant.
High initial investment cost due to merging the cultural part with the restaurant.
High degree of competition from Rivals, as there are plenty number of foreign restaurants in china.
1-High growth of restaurant industry in China , as stated by Chinese government.
2-Chinese behavior changed to go for lunch and dinning in restaurant either for entertainment or for business.
3-Fast Growing of the Chinese GDP per capita.
4-Chinese behavior to test , try all new and switch to new restaurants .
5-Shangahai as a huge merchandising city is an attractive city for the Arabian merchandisers who loves the Egyptian food and culture
The location in Shanghai in east china
We will provide our meals directly to our clients through dine-in
Our Ingredients comes from the best suppliers
both Chinese or Egyptians
7 Ps Marketing Matrix
Country Selection Decision
China has more political stable relations with MENA region
Unstable political relationship between Russia and Europe since intervention of Russia in Ukraine 2014
Syria military intervention
China ranked as the 2nd GDP 11,348.8 Billion USD
Russia ranked as the 10th GDP 2,079.134 Billion USD
China has unemployment rate 6.1% and inflation rate 3.2 %.
Russia Average inflation rate 15.7% over year 2015
China means technology is cheap
China transportation and infrastructure has experienced major growth and expansion in recent years.
Russia has a lack of infrastructure investment over
the last 10 to 20 years has dropped Russia to 93rd globally
in quality of overall infrastructure in
The Global Competitiveness Report 2013–2014
Timing of Entry
it will bear the primary demand creation cost
Pyramids Restaurants will enjoy the first mover advantages (early mover)
What you should Know Before You Go?
The official national language is standard Chinese, based on the Mandarin dialect
It is spoken by more than 70 percent of the population
Many Chinese speak Cantonese, Shanghainese, and Kejia dialects
English is spoken by many business people
There is one common written language although spoken Chinese has many dialects
the thousands of ideographs in Chinese language are not easily adapted to use on a computer keyboard
recognizes 202 languages. Each minority speaks its own dialect or language
bring your own interpreter as well to help you understand nuances in the discussion
Punctuality is very important in China, not only for business meetings, but for social occasions as well.
You should understand the significance of different colors in China
use black and white for your collateral materials.
Gold means luxury symbol
The Chinese are cautious in business matters and expect a strong relationship to be built before they close a deal
Prepare Promotion with a translation printed (in Mandarin Chinese)
Chinese Eating Habits
Geert Hofstede's Cultural Dimensions
Appetizers & Salads
Beverages & Shisha
High-Low Pricing Strategy
Market Penetration Pricing Strategy
Psychological Pricing Strategy
Chinese Eating Habits
Most banquets start between 6:30 and 7:00 p.m. and last for several hours
When eating rice, it is customary to hold the bowl close to your mouth
At a meal, they are eating lightly in the beginning,
Expect your host to keep filling your bowl with food whenever you empty it.
Finishing all of your food may be an insult to your host, because it can mean he did not provide Enough food.
Leaving a bowl completely full is also rude.
Never take the last bit of food from a serving dish; this can signify that you are still Hungry.
Chinese Eating Habits
The serving of fruit signals the end of the meal.
If you do not want refills of tea, leave some in your cup.
The Chinese use chopsticks for eating and a porcelain spoon for soup
When you are finished, set your chopsticks on the chopstick rest. Placing them parallel on top of your bowl is considered a sign of bad luck
Try not to drop your chopsticks; it is considered bad luck.
One dish you will no longer encounter in China is “dragon, tiger, phoenix”—which was made with the meat of a snake, a civet cat, and a pheasant
Chinese eating Habits
We provide our food in a convenient multi-themed restaurant
The staff customs, music and decorations of the staff will match the corner theme
Egyptian and Arabian performances are held at weekly basis in the restaurant
Greeting Clients Properly
Guiding the client to his desired corner
Presenting meals Prepared by professional experienced staff from only the best available fresh ingredients
Getting a Feedback about the whole experience
highly trained staff
Egyptian and Chinese employees.
Training on Chinese communication skills and Chinese culture
Arabian Performers for the weekly shows