Target Market
Being the Fortune Cookie Car Parts, our aim is to manufacture automotive parts that we shall export to industries in other countries that assemble parts to complete automotives. With the globalization of trade, we can be able to export our products to the other nations without incurring many costs.
Our main objective is to reach the best performing automotive industries in the world. With the vast growth in automotive industry in Germany, our most interest will be to venture in their markets. Germany automotive industry has experienced tremendous growth in the last ten years that has enabled it to penetrate more in the European market and the global market as well (Jerenz, 2008). This has made the industry play a recognizable role in the total turnovers of German’s industries.
The growth in its market has made the demand for the German automotive industry high (Jerenz, 2008). This demand has made the industry to face great challenge in production and labor costs, that is why this factor has turned the market attention to automotive parts manufacturing companies to reduce their costs (Steven, Sherwood & Dunn, 1993). This gives us an advantage over a manufacturing firm dealing with the automotive parts.
In the German market, our greatest interest is to have a competitive advantage that will help us to dominate the market (Aaker & Mcloughlin, 2010). The market is vast for our products in Germany as the country’s industry deals with different types of automotives.
They further deal with the sale of parts. We can take advantage of these factors to increase our sales. In addition, Germany’s economy is stable, which allows us to have a good and reliable market that cannot easily fluctuate. In addition, Germany plays a great role in the European and global markets that gives us an opportunity to influence other countries to have business activities with us (Ferell & Hartline, 2011).
Market analysis
The market analysis is made by focusing on the Germany market environment. To analyze it, we applied the PEST approach (Doole & Lowe, 2008). We examined the political situation in Germany as well as the following factors such as economic, social and finally technological ones.
This further led us to having a SWOT analysis that helped us to have an understanding of our strengths, weaknesses, opportunities and threats (Bohn, 2008). In political factors, our findings revealed that Germany experienced stability in politics for a long period. This fact made us have confidence in investing in its markets. In addition, the regulations laws are favorable to the foreign investors in German (Doole & Lowe, 2008).
The economic factors research indicated that Germany had the best GPD in Europe. This factor strengthened our idea of investing in the German market (Smith & Raspin, 2011). Further, the research indicated that the automotive industry contributed a lot to the Germany total turnovers.
This gave us hope that the industry was stable and the government as well as individuals paid attention to the industry as these matters had a great influence in Germany’s economy. In social aspects, the research indicated that there were language differences between the Germans and the Chinese.
In technology, we understood that Germany automotives were recognized and perceived as of high quality in the markets. We, therefore, realized that we were to produce high quality goods in order to match their market. We also considered that in order to have a competitive advantage, we needed to sell our products at cheaper prices than our competitors did. After understanding the markets in Germany, we then turned our attention to Fortune Cookie car Parts Company.
The SWOT analysis evaluated what we achieved our best using the available resources as a newly established company (Dealtry, 1992). Among the findings, we found that we had an advantage of cheap cost of production due to inexpensive materials and labor in the Chinese markets.
In addition, we realized that we could produce large quantities of goods to increase the scale of production and reduce shipment costs using bulk shipping. We also realized that we were in a position to issue a diverse range of products, thus different types of automotives that German market dealt with required different types of parts.
In our weaknesses, we evaluated the challenges that we faced in our production and what required improvement with immediate effect (Aaker & Mcloughlin, 2010). We realized that we had a challenge in technology and assets limitation. With an understanding that German automotive industry required high quality products, we realized that the technology we intended to use did not reach the level of technology required to produce goods for German market.
We also realized that the companies started from scratch needed significant amount of capital that would help us to ensure high quality products and costs. Further, we realized that at the initial stage, the company was not able to offer the prices that the market in Germany required.
As opportunities, the company mentioned the possible market venture that we could invest in (Dealtry, 1992). Our findings showed that we could use the position of Germany in the European Union and the global market to look for more market ventures. This was due to our understanding that Germany had a great influence in the world economy. Similarly, we realized that there were various automotive companies in the globe, which we could prospect for markets.
However, we noted that these opportunities would be only possible if we had a success in the production of quality goods and sustainability in the market. In addition, we realized that with the growing market of assembled automotives, we could change our specialization in manufacturing and assembling company in future. This would help us to have diversity in our sales through sale of parts and assembled cars.
Concerning the threats, we evaluated the external challenges to the firm (Bohm, 2008). We realized that though Germany was politically stable, its system of government was different from the Chinese one. We considered the fact that in Germany, it operated under common laws while here in China, we used bureaucracy.
These differences in political realms could have consequences in future. We also noted that the differences in language and cultural differences might hinder our communication with the counterparts from German. Another notable threat was the fluctuation of foreign exchange and the problems in the conversion of our Chinese Renminbi to Euros as we had to convert our currencies to American dollars first.
In addition, we were to take into account that the competition of companies manufacturing automotive parts was very high. Most of these companies succeeded in their markets. We, therefore, required to produce more quality goods at cheaper prices to show them to a better advantage compared with the other competitors’ products’ one.
Conclusion
With Germany market being our target and with the market analysis being comprehensive on the external and internal factors to our company, the next thing was to form a market strategy that would help us meet our overall goal. This market analysis was to build a foundation for our strategic plan as it gave us the understanding of the market needs, our ability and challenges to meet this need, our opportunities to utilize in the market and the threats. Now, the task set is to create an effective marketing strategic plan.
References
Aaker, D., & Mcloughlin, D. (2010). Strategic marketing planning: Global perspectives. West Sussex: John Wiley & Sons.
Bohm, A. (2008). SWOT analysis. Norderstedt: Grin Verlag.
Dealtry, T. (1992). Dynamic SWOT analysis: Developer’s guide in managing real-time issue. Birmingham: DSA Publications.
Doole, I., & Lowe, R. (2008) International marketing strategy: Analysis, development and implementation. 5th eds. United Kingdom: Cengage Learning.
Ferell, O., & Hartline, M. (2011). Marketing strategy. United Kingdom: South- Western Cengage Learning.
Jerenz, A. (2008). Revenue management and survival analysis in the automobile industry. Wiesbaden: Gabler Verlag.
Smith, B., & Raspin, P. (2011). Creating market insight: How firms create value from market understanding. West Sussex: John Wiley & sons.
Steven, R., Sherwood, P., & Dunn, P. (1993). Market analysis: Assessing your business opportunities. New York: Haworth Press Inc.