Introduction
The focal point of the paper is to prepare a feasibility report on exotic foods industry in France and Switzerland. For the purpose, there would be a country analysis of France and Switzerland for exotic foods industry. Analysis and evaluation would be carried out on the two countries in terms of providing opportunities or risks in the foreign markets. This would include market characteristics, marketing institutions, industry conditions, political/legal environment and business operating resources. Based on this country analysis, recommendation would be revealed which of the two countries would have the greatest market potential and explain why. Furthermore, suggestion would be provided on the most effective market entry strategy and provide supporting rationale.
France
France shares its border with Spain, Andorra, Monaco, Italy, Switzerland, Germany, Luxembourg and Belgium. It has a total population of 64, 473,140 and a density of 295/sq mi. (Fletcher, 2007).
Market characteristics
The stock exchange is growing steadily from 1997 and the overall economy can be enumerated as steady. However it can be stated that there was a boom period during the 1997 when the general index was reported to be raised by about 11%. During this period, the blue chip industries grew about 14%. The indexes came down the next year but this was estimated beforehand therefore, there was no crisis at hand. The inflation rate during this time was 1.5%. (Fletcher, 2007).
Marketing institutions
The Balance of Payments and Foreign Trade details are always important for a country and it is more important for companies who are willing to invest in a country. If the revenue of the country be compared with the revenues earned in 2005 it would be found that where as in 1997 the total balance showed show at a rate of only 2.5% the amount in 2004- 2005 was reported to be 18% with the amount showing about 10% at 2001- 2002. (King, 2005, 140) It was found in 2004-2005 that the total amount was valued at $8 billion. All these features are lucid enough to indulge in investing in this country. (King, 2008).
Industry conditions
The government is reported to be very active in attracting investments- both domestic and foreign. This is applicable in all sectors and strata of the country’s economy. Over the last five years, the country has made significant progressive approach towards political, economical and social stability making it a lucid investment site for foreigners.
Political/legal environment
Foreign Investment too is in a state of stability and it could be considered as a favorable for overseas companies. The government has made policies that are instrumental in stabilizing the economy and at the same time, the liberalization programs taken up by the government has made way for enlistment of many trade barriers free formulations. These liberalization procedures have also established policies that eradicated capital flow restrictions. Along side, the government is also instrumental in completely opening up of the economy thereby making the country enlisted among one of the most open economy in the world in perspective of foreign investments. (Fletcher, 2007).
Business operating resources
Trade exports of the country sums up to around $6.6 billion and the major established markets of this export are the United States, which occupies about one fourth of the total export. Other markets are Germany, China and Switzerland. (Dollard, 2006).
Switzerland
Liechtenstein, Austria, Italy, France and Germany border Switzerland. It has a population of 7,591,500 with a density of 479.8/sq mi. There are four official languages. These are Romansh, Italian, French and German. (Kar, 2006).
Market characteristics
Economic Forecast of the Switzerland indicates a relatively stable political and economical state of affair, the two most important aspects for any investors. The social structure being a mixed bag of catholic and local custom the stability in regards of demographic sustainability can be assured.
Marketing institutions
It should be taken into account that the country exercises a signed agreement with the Overseas Private Investment Corporation and this agreement is instrumental in effective negotiation dealing with trade concerns like investments, guarantees and OPIC-financed loans.
Industry conditions
As per macro economics it can be forecasted that the inflation rate would continue to be rated within a parameter of 8% and 4% making it a tangible variable with a mode of 6% sustainable economy. The forecast also refers to a minimum output growth of 4% making the mid and long term investment a safe probability. The basic reason behind this forecast is the fact that Switzerland is attracting both foreign and domestic investments at the same time. Alongside with the growth of petroleum and electricity on a rising scale both of these operating variables can be taken into account as safe and sustainable with comparatively cheap operational cost incurred. (Kar, 2006).
Political/legal environment
Alongside one of the most important step taken by the Swiss government is that the authority has taken into consideration the basic arbitration policies that include investment disputes that concerns about government-to-government transactions. This entire agreement is motored and overlooked by the World Bank’s International Centre for the Settlement of Investment Disputes thus making the foreign transactions affordable and comparatively risk free. (Lamb, 2004).
Business operating resources
The government has enacted and enforced many laws that are positive indications for the foreign investors. The Investment Promotion Law and the Private Investment Growth Law has made way for the investors to indulge freely into the country. (Dos, 2006).
Recommendation
Investment in France for exotic foods industry in France and Switzerland appears to be a positive investment formulation with the basic structure of the country being affordable in terms of economy and trade guarantee. However, if chosen between the two, Economical aspects look favorable for the investment issue and the France. Companies can always invest in this country with the probability of excellent yearly harvest on a longer term. The reason behind this is logical. Both the countries enjoy a good economic condition and industrial growth. Though the purchasing power of Switzerland is more than France, it should be noted that France enjoys a greater population and operates in a single language. It is backed by better overseas links than Switzerland. Thus, the future prospect cannot be ignored. Thus, France remains the recommended site of business for exotic food industry. (Edelman, 2005).
Strategy
The best possible strategy to penetrate the French market is to launch a countrywide advertisement campaign. Taking note of the fact the French population has a history of likeness towards creativity and food, it is suggested that campaign should focus on the variety of exotic foods and that should be presented in a very creative manner. (Fletcher, 2007).
References
Dos, M; (2006); Future of Thought Process: Management Gurus; Christchurch: Alliance Publications.
Dollard, John & Doob, Leonard W; (2006); Aggression in Decision Building; New Haven and London: Yale University Press.
Edelman, S; (2005); Evaluation Techniques in International Business Management; Bloemfontein: ABP Ltd.
Fletcher, R; (2007); French Foods: Believing and Knowing; Dunedin: Howard & Price.
Kar, P; (2006); History of Industrial Economics and Related Applications of Switzerland; Kolkata: Dasgupta & Chatterjee.
King, H; (2008); France Today; Auckland: HBT & Brooks Ltd.
Lamb, D; (2004); Cult to Culture: The Development of Civilization; Wellington: National Book Trust.