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Posted on August 19th, 2012, by

In the contemporary business environment, the competition between companies operating in different industries is constantly growing because the process of globalization contributes to the elimination of fiscal barriers and development of free trade. In such a situation, many companies oriented on both national and international markets have to take into consideration the situation not only on the local markets, but also the situation on the international markets. At the same time, it is also necessary to take into consideration such factors as political and legal environment along with socio-cultural environment.

In this respect, it is possible to refer to Australian Vintage Ltd, a successful company which is currently operating on Australian wine market and develops its export capacity. In actuality, today, the company is oriented not only on the national market but also on international ones. Nevertheless, the company cannot ignore political and legal environment. At this point, it should be said that basically political and legal environment is favorable for the development of business by Australian Vintage Ltd because the Australian authorities attempt to support the development of local companies operating in the wine industry (Schein, 1999, p.137). At the same time, the elimination of fiscal barriers, supported by respective legislative changes in Australia and other countries of the world, enlarges opportunities for the company to enter new markets, including not only markets of Asian countries, where the position of the company was traditionally very strong, but also European and American markets, where the competition is traditionally higher than in Asian and developing countries of the world.

On the other hand, in spite of the political stability in Australia and positive legislative changes, the company still faces the problem of socio-cultural traditions, especially abroad, which put its products in disadvantageous position. In fact, Australian wine is traditionally perceived inferior compared to traditional European or American vintage companies (Viardot, 2001, p.195). As a result, the company suffers from the lack of a positive customer experience and customer loyalty, which are, to a significant extent, defined by the lack of socio-cultural traditions and tastes of customers. In other words, customers outside Australia get used to European, especially French, Italian or Spanish, wine or American one, while Australian products are relatively new for many cultures worldwide.

In such a situation, the development of effective strategies is crucial for the overall success of Australian Vintage Ltd. In this respect, it is possible to recommend focusing on the introduction of the total quality management as one of the major strategic directions in the development of the company. In actuality, the company has in abundance natural resources which it can use for the low cost production (Peters, 2002, p.231). Therefore, the company needs to ensure the high quality of its products in order to improve its marketing position not only in Australia, where its position is already good, but also worldwide.

In addition, the company needs to be more flexible in relation to its suppliers. Australian Vintage Ltd should increase the range of suppliers that will allow to decrease costs and to increase competition between suppliers that will have a positive impact on the quality of grape (Howard, 2000, p.247). Packaging is also important for the quality of the company’s products and, what is more the maximization of utilization can contribute to overall low costs. Also, it is possible to recommend the implementation of Just-in-time strategy which can increase the flexibility of the company and save costs because the company will be able to produce the right amounts at the right locations saving costs on storage. However, this strategy implies the improvement of the existing logistics.

Finally, the company needs to focus on the improvements to production processes. The company needs to increase efficiency and productivity focusing on key competencies. In such a way, employees will increase their professional level and, therefore, they will improve the effectiveness of their work. At this point, the company should develop sharing information among employees. In addition, the company should acquire distribution lines and channels to deliver its products directly to customers maximizing customers’ satisfaction and company’s profits.

In the contemporary business environment, the company should focus on the international market expansion because the loss of international markets will deprive the company of the possibility to gain a better market position. Moreover, the failure to enter foreign markets is likely to lead to the loss of local market as well because the company will be unable to compete with large multinational corporations in the situation where the local authorities cannot protect it from foreign competitors by means of fiscal barriers.

In such a context, the company needs to develop team management and good support team, which can increase the efficiency of the performance of Australian Vintage Ltd. Also, the company should attempt to automatize operating processes and minimize the manual labor that will decrease costs of the production, though it may have a negative impact on the quality of products that means that operating processes should be carefully regulated. In fact, this means that the company needs to introduce effective technological innovations.

In the modern business environment, customer management is also of the utmost importance. The company should focus on the formation of a positive customer experience and customer loyalty that may be done through the implementation of the total quality management. Also, the effective distribution through the company’s network can contribute to the high level of customer satisfaction.

Finally, the company needs to introduce an effective regulatory system. This means that the company should introduce special laboratories which can control the quality of grape and wine produced by the company and delivered to customers.

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