The report conclusively highlights the strategic analysis of external business opportunities and vested characteristics which could be used as opportunities by Dewlay Cheesemakers. The use of three distinct models for analysis such as SWOT, Porter’s five forces, and PESTEL analysis in the context of the decision of the organization to expand into the overseas market of Ireland. The selection of Ireland as a viable overseas market for international business expansion can be validated on the grounds of its long-lasting ties with Britain in terms of business and trade. The research methods which were used in the report primarily include primary and secondary data collection techniques that predict opportunities for capitalizing on the thriving Irish dairy sector to obtain major dividends on investments.
Development of the dairy sector on a global scale has been impressive for the last few years with cheese being anointed as a product that could sustain the growth of the dairy sector in the coming years. The reports about the world cheese market indicate that the production of cheese has depicted staggering rates of growth in the period from 2010 to 2012 in which the estimated volume of production was well above 20 million metric tons. Therefore, Dewlay Cheesemakers has a considerable set of opportunities that it can utilize for entering foreign markets and capitalizing on the prospects offered by the global cheese market. However, consideration of market forces, internal competencies, and external factors in a business environment is essential for Dewlay Cheesemakers to ensure expansion in foreign markets along the lines of its preferred marketing strategies.
The research requires the recognition of potential opportunities and setbacks for Dewlay Cheesemakers in the event of the decision to engage in international business activities in Ireland. The expansion of the organization has to be based on the outcomes of research about the external market environment in Ireland as well as the evaluation of the internal competencies of an individual (Dewlay, 2017). The company’s reputation in the local Garstang, Lancashire serves as a formidable indication of the company’s potential to acquire customer attraction in overseas markets (Dewlay, 2017). The use of analyzing the competitive environment for Dewlay can be illustrated as follows in terms of evaluating the capabilities of individual competitors which could impinge on the performance of Dewlay Cheesemakers in the Irish dairy market.
The nature of Dewlay Cheesemakers as an organization can be perceived as a small medium enterprise (SME) with a major production emphasis on cheese alongside exports to overseas markets in packaged form. The potential competitors which Dewlay Cheesemakers could face in the dairy sector in the UK as well as other countries can create substantial challenges for the enterprise despite the opportunities for flexible global expansion (Al Ariss, Cascio and Paauwe, 2014).
Fine Cheese Company: Based in the UK, this organization has a profound reputation as a retailer, wholesaler, and exporter of cheese. The organization basks in the quality of its cheese which is derived from conventionally unpasteurized milk. The effectiveness of the Fine Cheese Company can also be observed in the varied assortment of cheese that can be accessed by customers. Furthermore, the company has its own set of distribution channels which enable it to stay clear of supermarkets and distribute its products through independent retailing.
Ets. Freddy Baines NV Flanders Milk: The Company, based in Antwerp, Belgium, reflects on its potential for global distribution due to the presence of the second largest port in Europe. The company’s global operations in New Zealand and Argentina also indicate its ability to capitalize on the favorable market opportunities perceived in the Ireland dairy sector. The specialization of the company in dairy products rather than cheese could be a potential motivator for the company to garner a higher market share.
The Lactalis Group: Lactalis Group is a French enterprise with a global reputation and is operated as a family business. The expansion of the company in the domain of global business can be noticed in the presence of the company in 43 countries all over the world with production capability spread across 230 production units and 75000 employees (Radebaugh, Sullivan, and Daniels, 2015). The value statement of the organization indicating its reputation as the ace cheese producer in Europe can be reflected profoundly in the company’s diverse assortment of dairy products such as cream, milk, etc.
Northumberland Cheese Company: The foundation of the company can be traced back to 1984 when Mark Robertson laid its foundation in Northumberland. The company has also been credited as the leading cheese company in the UK with its traditional and modern variants of 17 different types of artisan cheese. The volume of cheese production realized by the organization can be validated on the grounds of the local milk supply acquired by the company.
As per Buckley et al, the SWOT analysis of Dewlay Cheesemakers would be directed towards an internal analysis and is primarily executed through internal feedback and assessment as well as the services of external agents (Buckley et al., 2016).
Ireland is the target country for Dewlay Cheesemakers and depending on the number of competitors the company may have to face in an international business environment for marketing its products and services. Selection of Ireland as the target overseas market can be validated based on the following.
The proximity of Ireland to the UK enables the company to maintain the freshness of its products and since Dewlay Cheesemakers has to sustain the freshness of its products to establish a formidable value statement the factor goes in favor of Dewlay Cheesemakers.
Low-cost producers of milk can be perceived as a major opportunity for Dewlay Cheesemakers to access the Irish market according to the analysis of economic factors in PESTEL analysis. The availability of a huge number of milk suppliers creates suitable prospects for the organization to obtain raw materials at comparatively minimal prices. The abolishment of EU milk quota limits in 2015 also provides complementary support in such scenarios of global expansion.
The pervasive demand for cheese observed in the Ireland market also signifies a major opportunity for Dewlay Cheesemakers to ensure expansion in the overseas market. Despite the presence of different renowned brands, Dewlay Cheesemakers could expand its market share over time depending on its commitment to the quality and value of products.
The distinct forms of market entry strategies that could be implemented by the Dewlay Cheesemakers are reflective of the analytical outcomes of competition in a market. The development of strategic alliances with companies in Ireland as a response to Porter’s analysis depicting the higher intensity of competitive rivalry can be considered a viable market entry strategy (Cavusgil et. al., 2014). Quality and value of the products of Dewlay Cheesemakers can be propagated among the local customers through joint ventures which could lead to a flexible appreciation of products by the customers.
References to competitive and penetration strategies are essential in the context of Dewlay Cheesemakers’ international business expansion in Ireland since the competitive environment in Ireland is difficult to enter. Utilization of a cost leadership strategy for market penetration can be validated on account of the minimal distance between the UK and Ireland as well as the value and quality of cheese provided by the company that can form a unique value proposition for customers (Radebaugh, Sullivan and Daniels, 2015). Product differentiation can also be assumed as a viable competitive strategy implying the sale of products in bundles through food retailers in the overseas market which subsequently reflects on the capability of Dewlay Cheesemakers to penetrate the Irish cheese market.
The observations from the research have to be aligned with appropriate recommendations for Dewlay Cheesemakers which intends to establish international business operations in Ireland. Thus, it is immensely important that Dewlay Cheesemakers should derive strategies from the analysis of SWOT, PESTEL, and Porter’s five forces as highlighted above. The strengths of the company should be capitalized on to cater to the diverse level of competitive rivalry observed in the Ireland market (Cavusgil et. al., 2014). The use of cultural values as a formidable depiction of quality can be represented through appropriate marketing and advertising strategies by Dewlay Cheesemakers (as identified in Porter’s five forces). The prolific recommendation for Dewlay Cheesemakers in this scenario could also refer to the use of distinct production and distribution strategies in the Irish market for gaining a competitive advantage over domestic firms.
The considerably low reputation of the organization in the global market can be compensated by expansion into Ireland which has potential trade ties with the UK and could be potentially beneficial for Dewlay Cheesemakers. However, Dewlay Cheesemakers have to assume the underlying implications of BREXIT on the business relations between the UK and Ireland as well as the prospects for changes in trade regulations. The aftermath of BREXIT would lead to changes in taxation for UK-based firms in EU member countries since Britain would be treated as a foreign entity.
The report has presented a concrete analysis of the opportunities for Dewlay Cheesemakers to initiate its operations in the Irish market. The provision of a distinct analysis of competitors as well as the potential of Ireland as a global market proved to be major highlights of the report. Thus, Dewlay Cheesemakers must evaluate its resources and potential to invest in an international business assignment in Ireland according to the potential implications which could be derived from the agreements between the UK and the EU when the exit will be formally authorized. The period gap till the official declaration of Brexit should be utilized by Dewlay Cheesemakers to obtain a gradual yet successful establishment in the Irish dairy market (Radebaugh, Sullivan, and Daniels, 2015). Finally, the cost must serve as a major barrier for Dewlay Cheesemakers to enter foreign markets such as Ireland. In such cases, the organization could prefer alternative modes of market entry such as licensing or franchising to establish the brand’s foreign business operations and promote the brand message effectively alongside acquiring potential financial dividends.
Al Ariss, A., Cascio, W.F. and Paauwe, J., (2014). Talent management: Current theories and future research directions. Journal of World Business, 49(2), pp.173-179.
Buckley, P.J., Burton, F. and Mirza, H. eds., (2016). The strategy and organization of international business. Springer.
Caprar, D.V., Devinney, T.M., Kirkman, B.L. and Caligiuri, P., (2015). Conceptualizing and measuring culture in international business and management: From challenges to potential solutions. Journal of International Business Studies, 46(9), pp.1011-1027.
Cavusgil, S.T., Knight, G., Riesenberger, J.R., Rammal, H.G. and Rose, E.L., (2014). International business. Pearson Australia.
Foss, N.J. and Knudsen, C., (2013). Towards a competence theory of the firm (Vol. 2). Routledge.
Hill, C.W., Jones, G.R. and Schilling, M.A., (2014). Strategic management: theory: an integrated approach. Cengage Learning.
Kelley, L. and Shenkar, O., (2013). International business in China. Routledge.
Lumpkin, G.T. and Dess, G.G., (2013). Strategy in the family business: Recent findings and future challenges. The landscape of family business, pp.93-112.
Dewlay.com (2017). Cheese | Lancashire Cheese | Garstang Blue Cheese | Cheddar Cheese – Dewlay Cheesemakers. [Online] Dewlay.com. Available at: http://www.dewlay.com/ [Accessed 13 Jan. 2017].
Myers, M.D., (2013). Qualitative research in business and management. Sage.
Peng, M.W., Wang, D.Y. and Jiang, Y., (2008). An institution-based view of international business strategy: A focus on emerging economies. Journal of international business studies, 39(5), pp.920-936.
Radebaugh, L.H., Sullivan, D.P. and Daniels, J.D., (2015). International business: Environments and operations. Pearson Education.
Spieth, P., Schneckenberg, D. and Ricart, J.E., (2014). Business model innovation–state of the art and future challenges for the field. R&D Management, 44(3), pp.237-247.
Teece, D.J., (2014). A dynamic capabilities-based entrepreneurial theory of the multinational enterprise. Journal of International Business Studies, 45(1), pp.8-37.
Verbeke, A., (2013). International business strategy. Cambridge University Press.
Wild, J., Wild, K.L. and Han, J.C., (2014). International business. Pearson Education Limited.
Strengths: As per the research study, the foremost strength of Dewlay Cheesemakers can be observed in the cultural value associated with the company. As per Caprar et al, the organization relies on its traditional recipe conveyed by the founder of the company, George Kenyon. His cultural values were passed on to the third generation of cheese manufacturers which suggests a higher commitment to stakeholders (Caprar et al., 2015). The commitment of the organization to induce development activities in corporate social responsibilities as well as a wide assortment of dairy products and cheese variants enables a strategic advantage for the organization (Dewlay, 2017).
Weaknesses: The research findings suggest that Dewlay Cheesemakers is inflicted with the bane of inferior public relations which could potentially jeopardize the expansion in the Irish market. As per Foss & Knudsen, furthermore, it has been found that the supply chain of Dewlay Cheesemakers is marked by instability and inconsistency of processes as well as the lack of standardization according to international precedents (Foss & Knudsen, 2013).
Opportunities: The research study recommends the availability of ample opportunities for Dewlay Cheesemakers to access new overseas markets and capitalize on the potential of the emerging economies in Ireland. Dewlay Cheesemakers could also make the most of the backward integration for accomplishing higher levels of control on the organization’s supply chain (Hill, Jones & Shilling, 2014). The organization could also opt for the identification of new distribution channels in overseas markets which could ensure profitability as well as facilitate alternative business practices for increasing the efficiency of business performance (Verbeke, 2013).
Threats: The dairy industry in Ireland is characterized by the presence of formidable competitors some of which are also renowned brands on a global scale. Kelley & Shenkar said that the implications of Britain’s exit from the European Union serve as a prominent barrier for Dewlay Cheesemakers to expand in Ireland and therefore the organization has to evaluate the influence of the exit on price variations for raw materials, changes in tariff and taxation rates and the dynamics observed in the macro environment (Kelley & Shenkar, 2013). Other prominent threats which could be perceived in the case of Dewlay Cheesemakers refer to the impact of technological advancements and demographic changes on the availability of a functional workforce (Wild, Wild, and Han, 2014).
Political: The research demonstrates that the political factors in the macro environment of the Irish dairy market are characterized by elements such as WTO intervention, CAP health check, and redesign of the processing structure. The abolishment of EU milk quotas in 2015 as well as the WTO negotiations of Ireland which cited the exclusion of export refunds by 2013. Therefore these factors could have a potential impact on the prices of milk in Ireland and other European factories which can be utilized by Dewlay Cheesemakers to its advantage in the form of abundant and minimally priced milk. The domination of milk processing companies in Ireland could create potential setbacks for Dewlay Cheesemakers in Ireland’s market environment (Lumpkin & Dess, 2011).
Economic: The findings of the research suggest that economic conditions in the Ireland market for Dewlay Cheesemakers would be dictated by the exclusion of distinct trading privileges accessed by UK organizations before BREXIT. On the contrary, the factors of supply and demand in the Irish dairy market are not reflective of international involvement. Therefore excess supply from low-cost producers can help derive excess demand. Availability of land at flexible prices also accounts for a promising factor in the economic scenario of Ireland for Dewlay Cheesemakers.
Social: The research about the Dewlay Cheesemakers case study reflects on the demographic factors which indicate that the majority of the dairy farms are vested in Eastern and Southern Ireland. The younger age structure identified in the population could be utilized as an efficient workforce for Dewlay Cheesemakers and in the improvement of technological capabilities in the dairy sector (Myers, 2013). On the other hand, a decline in the percentage of young dairy farmers creates setbacks for Dewlay Cheesemakers.
Technological: The research demonstrates that the use of social media and new dairy processing technologies which could be accessible in the Irish market can be used as a vital technological aid for Dewlay Cheesemakers to enter the overseas market and capitalize on its potential to render profitability.
Environmental: Dewlay Cheesemakers are also liable to environmental obligations such as ensuring the safety of the products, compensation for dairy farmers, and sustainable protection of environmental resources in the Irish market (Peng, Wang & Jiang, 2008). The Bali Action Plan can be considered a reminder of the environmental obligations of the company.
Legal: The most notable legal factor which can be perceived for Dewlay Cheesemakers in the Irish market is the Water Framework Directive (WFD) which aims at accomplishing good water status for the surface as well as groundwater. This regulation has a substantial influence on the prospects of Dewlay Cheesemakers to establish its operations in Ireland (Teece, 2014).