Economic/Financial Environment Analysis
Business Expansion is a process in which the business is expanded by introducing the product in the new market. The company has the opportunity and threat to expand the business in the new market (Peng, 2016). The company develop the strategies to introduce the product in the market and to achieve the high market share. It is essential to analyse the market situation of the company so that it mainly focus on those areas in which they it face the challenges. In this report, the Tasmanian Mountain Waters has been taken into consideration to expand the business of Natural Spring Water in the UK market. In the beginning of this report, background of Tasmanian Mountain Waters ® Natural Spring Water will be analysed. Later on the discussion is made on the topic of political, economic, environmental, technological, social and legal factors to analyse the market situation of the company. At the end of the report, the recommendation will be mentioned as per the analysis.
Tasmanian Mountain Waters ® Natural Spring Water is a well balance source of water which contains the Phosphorus, natural calcium, magnesium, and the other necessary materials. The product is prepared with the best possible pH 7.6-7.8 levels. The company offers this product in two packaging sizes which is 5 litres or 10 litres of water bottle. To store the product for long time it uses the boxes so that it can easily store them. The size and packaging of the product is suitable to store the product for long time. It is estimated that the bottles have 5 year of life for use and it is convenient for the bench-top dispensing during the use of kitchen. The company provide the quality of product to the consumers by filtering it by two stages of micro filtration. The company uses the state-of-the-art micro filtration technology to filter the product and the sterilized it by using the ozone sterilisation method. The company filled the water in sterile metallised polyester laminate bags and boxes as per the requirement. Sterile metallised polyester laminate bags are uses to store the product in the clean room but the boxes packaging is use for shipment. It is founded that the quality of the product is pure, clean, natural and mineral water (Tasmanian Mountain Waters ® Natural Spring Water, 2018).
It has been seen that the 58% of the companies use the reusable water bottle as per the hygienic product. In 2017, the sale of plain water is increases by the rate of 8%. The 4000 million litre of rose water is consumed ever year and the plan water is consumed by the volume of 3100 million litres. The UK bottle water industry is growing and earned the £2.4bn per year which reflects the high growth of the market. It is founded that the 19% of the UK population drink bottle water in the daily routine and 50 litre of bottles water drank by each year (Welford, 2016). The entire 76% of population used bottles water to consume in the whole life. 90% of bottles water brands use the micro plastic contamination in the packaging of the water. The plastic bags use by the companies is not good for the environment because PET plastic water bottle takes 400 years to decompose the product which is harmful for the environment. The global consumption of the water bottles is 391 million litres which is useful for the company. It is estimated that the industry gain the high revenue with the annual rate of 6.9% over the five years which reflects that the company is growing with the continuous rate. The revenue is rise with the rate of 4.5% which is reached at the £1.1 billion (Crafts, 2017).
Political/Legal
It has been analysed that the GDP rate of the country is fluctuated with the different rates which helps the companies to achieve the success. The companies fail in the market due to fluctuated rate of economy because it affects the business deal. UK market is stable in the terms of economic condition but nowadays, it has been seen that the economic condition is not stable due to recession period (Panayotou, 2016). Due to recession period, it is difficult for the company to survive in the market because in this period the cost of production has been increased. The purchasing power of consumers is also goes down due to which the sale of the companies is falls down. But it is estimated that the condition will be improved quickly and the rate of GDP is also increases. The growth of the GDP has a positive factor for the Tasmanian Mountain Waters to introduce the product in the market.
The rate of interest of loan is also low due to which the company can easily borrow the money from banks to invest. It has been seen that the cost of production is also reduces due to low rate of interest. The purchasing power of consumers is increases due to low rate of interest. It is also a positive factor for the Tasmanian Mountain Waters ® Natural Spring Water because the chances of increasing the sale are rises.
The government plays the important role in providing the quality of services to the consumers. The government made the laws to the UK bottles water related to the quality of the product. The companies are penalised by the government as per the low quality of services provided to the consumers. The companies have to measure the quality of products before delivering the product in the market. The government of UK provides the benefits to the new companies who deliver the non-alcoholic products in the market. The rules and regulation of the government is change with the passage of time (Boswell, & Rodrigues 2016).
There are some laws made by the government which helps the companies to provide the quality of services. The companies have the responsibility to deliver the services after finishing the product. The water industry act of 1991 is compulsory to implement by the water bottle industry to achieve the success. The rules and regulation of the companies is analysed by the WHO (world health organisation). In UK market, it is essential to register the company under the Food Standard Agency (Knudsen, Moon,& Slager, 2015).
It has been seen that the consumer are getting health conscious to stay fit and healthy. The demand of the consumers is change with the passage of time. The diet of the consumers is changes with the change of lifestyle. The demand of healthy products is increases as compare to the other products. The consumers of alcohol drinks are decreases which is a negative factor for the alcohol shops and companies. The demand of consumers is shifted towards the less sugar products and the healthy water bottles to stay healthy. The people of age 37-55 prefer more the healthy drinks as compare to the teenagers due to good habits of eating. It is favourable factors for the Tasmanian Mountain Waters which states the expanding opportunity of the company in the new market (Renzetti, 2015).
Social/Cultural
The relation of the company with the consumers shows the cultural value of the company towards the society. The attitude, belief shared by the company with the consumers play’s the important role in increasing the sale. The message used by the company to promote the product also reflects the culture of the company towards the society (Fragkou, & McEvoy, 2016). In the UK, people come from different background to stay in the country. The taste of the consumers is different as per their culture and traditions but the natural spring water is neutral product. Each and every type of people consumes the product easily which is beneficial for the company because the chance of increasing the sale is increases (Weinthal, Vengosh, & Neville, 2017).
It has been seen that the UK market is capital market where the number of labour is less but the machines to produce the product. The companies use the technology at the time of filtering and packaging the product. The companies use the machines for automatic packaging the bottles which helps the company in reducing the cost. The cost of man power is reduces due to reduce the number of workforce in the society (Greco, Locatelli, & Lisi, 2017). The advance technology is also a favourable factor for the company to enter the market with the existing product. The company can achieve the success in the future by using the technologies. However, the company use the technology to filter the product but the packaging machines are the advance technology which is used by the company to filter the product. The company also has to use the quality management tool to maintain the quality of the product. The company has the opportunity to adopt the new technology from which the works of the company becomes easy (Financial Times, 2018).
It is the responsibility of the companies to take care of the environment by producing the chemical free product. The government of the UK made the acts related to the environment so that the environment did not harm from the production of the companies (Leslie, 2016). Plastic problem is increase in the UK which creates the number of challenges for the environment such as polluting rivers. The plastic water bottles have to recycle by recycle process to reduce these issues. The company also the face issue of environment because it also use the packaging of plastic to store the product for long time in a clean room (Dick, et al., 2016).
From the above discussion, it has been recommended that the company has to focus on some areas to achieve the success in the UK market and these are given below:
The company has the threat of competition in the UK market because there are large numbers of companies who have high goodwill value. It is difficult for the company to enter the market and compete with the exiting companies (Madsen, & Walker, 2015). The company has to develop the trust of the consumers towards the product due to which the company has to attract the large number of customer (Darroch, Miles, & Jardine, 2015). The company has to use the method of expansion so that the company achieve the high success in the market or to attain the large number of customer. The company can enter the market with the partnership method so that the consumers of existing company also try the product of the company. This method helps the company to reduce the cost of marketing. The company can enter the market with the Dasani because Dasani has high goodwill value in the market (Dasani, 2018).
Technological and Environment Analysis
Packaging material
It has been seen that the company can faces the challenge of environment in the market. The company use the plastic material to pack the product which is harmful for the environment. This factor becomes a threat for the company because the government of the UK restrict the company to enter the market in the country. The company has to use the aluminium cans and steel bottles which will not harm the environment.
The company face the obstacle of environment act because it uses the plastic package to store the product. The economic condition of the country is also a threat for the company to expand the business in the market (Wagner III, & Hollenbeck, 2014).
The company has the opportunities as well as the threat to enter the market of UK. It is an opportunity for the company to enter the market because it can learn the new technology, and the taste of the consumer is also a favourable factor for the company.
It has been recommended that the company has to borrow the money from banks to invest in the research and development process so that the company can analyse the situation of the market (Kim, Lee, Yang, & Chung, 2016).
Conclusion
From the above analysis, it has been concluded that the company has to expand the business in the market of UK. The company faced the challenges due to poor economic situation of the country but it is estimated that it will improve very soon and the consumer purchasing power is getting high. The sale of water bottles is increases with increasing rate due to social and culture value of the country. Political, legal, environmental, economic, technological and social factors analysed to evaluate the market condition of the country. The company has to enter the market with the partnership method to build the string relation with the consumers. Different types of packaging material and investment in research and development method helps the company in getting the success in future. The company will earn the high revenue by introducing the product in the UK market.
References
Boswell, C., & Rodrigues, E. (2016). Policies, politics and organisational problems: multiple streams and the implementation of targets in UK government. Policy & Politics, 44(4), 507-524.
Crafts, N. (2017). UK Economic Growth Performance in a European Context: Has EU Membership Made Much Difference?. In The Economics of UK-EU Relations (pp. 9-45). Palgrave Macmillan, Cham.
Darroch, J., Miles, M., & Jardine, A. (2015). Market creation: a path to sustainable competitive advantage. In Proceedings of the 2008 Academy of Marketing Science (AMS) Annual Conference (pp. 331-331). Springer, Cham.
Dasani. (2018). The DASANI® Story. Retrieved from: https://www.dasani.com/about-us/
Dick, J., Andrews, C., Beaumont, D. A., Benham, S., Dodd, N., Pallett, D., & Turner, A. (2016). Analysis of temporal change in delivery of ecosystem services over 20 years at long term monitoring sites of the UK Environmental Change Network. Ecological indicators, 68, 115-125.
Financial Times. (2018). UK digital technology sector outpacing wider economy. Retrieved from: https://www.ft.com/content/401955c2-58f1-11e8-bdb7-f6677d2e1ce8
Fragkou, M. C., & McEvoy, J. (2016). Trust matters: Why augmenting water supplies via desalination may not overcome perceptual water scarcity. Desalination, 397, 1-8.
Full Fact. (2018). UK economic growth within the G7. Retrieved from: https://fullfact.org/economy/uk-economic-growth-within-g7/
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Kim, J. B., Lee, S. U., Yang, D. Y., & Chung, W. J. (2016). Research History and Recent Trends in the Development of Sheet Metal-Forming Processes. Journal of the Korean Society for Precision Engineering, 33(4), 247-255.
Knudsen, J. S., Moon, J., & Slager, R. (2015). Government policies for corporate social responsibility in Europe: A comparative analysis of institutionalisation. Policy & Politics, 43(1), 81-99.
Leslie, D. (2016). Introduction: Sustainability, the European Union and Tourism. In Tourism Enterprises and the Sustainability Agenda across Europe (pp. 19-32). Routledge.
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Packaging News. (2018). Bottled water sales rise, according to report. Retrieved from: https://www.packagingnews.co.uk/top-story/formats-recycling-tackle-concerns-uk-water-drinks-approach-4000-million-litres-20-03-2018
Panayotou, T. (2016). Economic growth and the environment. The environment in anthropology, 140-148.
Peng, M. W. (2016). Global business. Cengage Learning.
Renzetti, S. (2015). Non-household water demand: the industrial and commercial sectors. In Understanding and Managing Urban Water in Transition (pp. 297-310). Springer, Dordrecht.
Tasmanian Mountain Waters ® Natural Spring Water. (2018). Product. Retrieved from: https://www.tasmanianmountainwaters.com.au/#products
Wagner III, J. A., & Hollenbeck, J. R. (2014). Organizational behavior: Securing competitive advantage. Routledge.
Weinthal, E., Vengosh, A., & Neville, K. J. (2017). The nexus of energy and water quality. In The Oxford Handbook of Water Politics and Policy. United Kingdom: Routledge.
Welford, R. (2016). Corporate environmental management 1: systems and strategies. Routledge.
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