Country Manager Simulation How To Win Latin America

Country Managing director Simulation

1. Executive Summary

1. Our visitor, AllStar, decided to enter the Latin American toothpaste market place. We selected v countries, Brazil, Argentine republic, Republic of chile, Mexico, and Venezuela, every bit our target market place on the basis of the current market situation, economic indicators and the tariff and shipping toll. Besides we decided to build a constitute in Brazil, for it is our largest marketplace and has the second lowest tariff and shipping toll.

2. Summary of performance. Reflection.

1. Market place Analysis

After analysing the economic indicators, demographic information, marketplace situation, and the costs, nosotros selected the top five most bonny markets amidst the Latin American countries to entry in 10 years: United mexican states, Brazil, Argentina, Republic of chile, and Venezuela.

1. Market Situation

Manufacturer toothpaste sales are the most of import consideration for our visitor, because they represent the size and the potential of markets. For this reason, nosotros decided to enter Brazil, Mexico, Argentina, and Chile in the commencement 5 years.

1. Tariffs and Shipping Costs

In the sixth year, we decided to enter Venezuela, for it has the lowest tariff and shipping price among the left iii countries, we had not have a present in.

1. Production Location

1. Outsourcing decisions

	Tariff as percent of CIF		Aircraft cost per UNIT in $
	Brazil Found	Chile Institute	Brazil Establish	Chile Plant
Argentina	0.0%	0.0%	0.020	0.020
Brazil		0.0%	0.010	0.020
Chile	0.0%		0.020	0.010
Colombia	12.0%	0.0%	0.020	0.020
Mexico	xv.0%	0.0%	0.040	0.030
Peru	12.0%	0.0%	0.020	0.020
Venezuela	0.0%	0.0%	0.020	0.020

In order to reduce the toll of goods sold (COGS), we decided to build a local institute in i of the Latin American countries on the condition that 'plant location must be efficient to serve identified markets'. All of the products for Latin America markets are sourced from this found except Mexico. Just the products for United mexican states are sourced from home facilities, considering United mexican states is benefited from NAFTA.

1. Tariff and Shipping Cost

After comparing the tariff and aircraft price, nosotros decided to build a plant in either Republic of chile or Brazil. Chile has the lowest tariff and shipping cost in exporting to other countries, while Brazil is the largest market, has the highest domestic consumption, and it is the 2nd-best choice regarding the tariff and aircraft toll. Considering the accessibility to our largest market, nosotros decided to build our local plant in Brazil.

1. Strategies for period 1 to v – 4P

We ready a guiding principle for 4P marketing strategies. This is by and large applied on all of our target markets.

Categories	Policies	Market place Data	Decisions
Product	SKUs selection policy	Demographic marketplace survey	Standardization
Price	Pricing policy	Shipping & Tariffs cost, Competition	Customization
Place	Distribution policy	Shopping habits, Sales force and promotion expenditure	Customization
Promotion	Advertising policy	Brand purchased, Advertizing expenditure	Semi-Standardization

1. Product

In the product selection policy, nosotros start with limited SKUs in every selected countries and review operation before introducing more than SKUs. According to the regional strategy, AllStar wants to position itself as a family-oriented brand with competitive prices; hence we introduced economy formula in every market we entered. Later we added special SKUs for each market place depending on the domestic need past using cantankerous-sectional analysis to investigate the preferred size, delivery, and texture in every market. For example, we sell White in Mexico, Healthy in Brazil, Kids in Argentina. In the afterwards period, more SKUs have been introduced in each state and by the cease of 5th menstruation All Star had a standardized SKUs strategy in every country, therefore we tin benefit from economy of scale.

1. Price

Nosotros set competitive prices for 'Economy' and 'Healthy' considering the target customers are relatively loftier price-sensitive. The price decision is based on the rival products in the same segments; the prices are lower than international brands but higher than local and regional brands to be competitive.

For the 'White' products, we set a similar price to our competitors considering the target customers are relatively low cost-sensitive customers. Simply we give higher allowances for them to create incentives for the retailers so they are more willing to sell our products.

Since "Kids" toothpaste is a niche product (pump, gel) and we have no competitor, nosotros set premium prices and low allowances for them.

In addition to the above principles, prices of all segments are adapted every year based on aggrandizement charge per unit and on competitor's increase.

1. Identify

Our distribution aqueduct decision was fabricated on a country-by-state basis. First of all we recognised the target customers of each conception, such as "Economy' for family unit, "White" for younger people, "Good for you" for family, "Kids" for family unit, and and so we looked at their shopping habits in each land and identified the core distribution channels that target customers spend in their countries.

We consider the number of sales forcefulness according to the sales force expenditure of competitors, so allocated sales force in core distribution channels.

Equally for the promotion budget, nosotros decided the accented corporeality on the basis of competitors' budgets. The resource allotment of relative promotion budget in each channel was based on the total channel sales when inbound a new market for the first time, and it was based on last year'due south sales' if our products had already sold in that country.

1. Promotion

When introducing new SKUs in any countries, nosotros used ads to help promote our products and create positive brand image and deed as the 'pull strategy'.

Beginning, we considered the advertising budget by comparing with competitors in the country, and we adapted existing advertising campaigns if available, merely chose to suit them to local civilisation and language. We saved the costs of creating new ads and benefited from cantankerous-national paradigm consistency through this way.

Specifically target audience and benefit message of campaigns are as mentioned in distribution strategy.

We did the advertising for every segment and allocated advertising budget proportionately to the consumer'south demand for each formulation, and updated the ads every one or 2 years to refresh the content and maintain brand awareness.

1. Result afterward 5th period

We earned a significant success afterwards v years Allstar had a presence in Latin America. Allstar became the market leaders in 3 of the countries we had entered: Mexico, Brazil, and Argentina. The only country we did not achieve such a success was Republic of chile, which we entered in the 5th period.

Afterward 5th menses, our cumulative return on marketing is 121.1% and the make disinterestedness is 78.

Source: https://studydaddy.com/attachment/56537/8ixmv29elr.docx

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