LONDON SCHOOL OF COMMERCE

COLOMBO CAMPUS SRI LANKA

MBA FOR EXECUTIVES

Module Assignment : International Marketing

Management

Student Name : Trisette Marita Williams

Student Registration No : B0045SSSSSS0618

Module Lecturer : Mr. Anand Walser

Module Tutor : Ms. Apsara Hewage

Date Submitted : 04th May 2019

Total Word Count : 2,128

 International Marketing Management
I declare that this assignment is my own original work and that I have acknowledged all
materials used from the published or unpublished works of other people.

Name : Trisette Marita Williams

Date : 4th May 2019

1
Executive Summary

Globalisation is the connectivity to the global society, in today’s world for any corporate entity to enjoy
sustained survival global connectivity is a must. In today’s world one would notice that the global society
is in the rise in which the economic, political, environmental, technological and cultural events of one
country has an impact on another country. This is a junction where the growth of these segments links
the bond between individuals, governments and business which leads to creation of Multinational
Corporations.

International Marketing Management has thus evolved to a greater extent today. It has created
organisations to spread its reach in to diversified fields and make its presence in unknown territories. One
would agree that saturation begins over time and making the move at the right time to spread its reach
brings in positive first mover advantages to such corporations.

Today globalisation has hit the pearl of the Indian Ocean as well in which the local biscuit market has been
saturated. Dominant players such as Ceylon Biscuits Limited has explored other means of reaching outside
markets for its further growth. Aligned with this, the company vision is to be the leader in confectionary
in Asia (Sundaytimeslk, 2019 ), with an interim goal of been the number one in the SAARC region.

Considering the above vision the company has been exporting its products to 55 plus countries while
having only two manufacturing plants which are based in Sri Lanka and Bangladesh. As sighted in
(Sundaytimeslk, 2019) the biscuit market alone is to grow at a compound annual growth rate of 5% and
this market is expected to reach USD135Bn in 2023. Sri Lanka is one of the largest countries that consumes
biscuits as sighted in (Sundaytimeslk, 2019). Its further witnessed that Asian market would also remain as
dominant market as sighted in (Transparencymarketresearchcom, 2019).

Considering the above and the company’s vision there is tremendous growth opportunities in the outer
market for CBL to further expand its wings to untouched horizons. Historically CBL has been exporting its
products via a dealer network. This process is acceptable for initial startups, since one would have control
over the cost and management of staff confined to local operations. However to meet its vision one would
need to be more close to its consumers to enable the entity, sell its products directly to its customers and
avoid the middle man been the agent. This will bring in more profitability and market presence to the
company to meet its end vision. In addition this enables the company to support the development of the
economy by creating new jobs and reaching its customers with a local touch to gain greater market share.

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Considering the above the following report would reflect as to how CBL would proceed to make a land
mark presence in Cambodia by taking advantage of the Cambodian government investment incentives
and commence manufacturing its products to the local community. Also it will act as an exporting HUB to
further reach its product availability to the international market. Due to the diversified organisation of
CBL the analysis would concentrate mainly on the confectionary segment biscuit in which the brand name
Munchee is the market leader in biscuits in the domestic market to the next frontier.

3
Contents
List of Tables .................................................................................................................................. 5

List of Figures ................................................................................................................................. 5

Abbreviations .................................................................................................................................. 5

Assumption and Limitation............................................................................................................. 6

1.0 Introduction on Ceylon Biscuits Limited ............................................................................. 6

2.0 Proposed Country for Expansion ......................................................................................... 6

2.1 Country Selection Justification...................................................................................................... 7

2.2 Market Entry Strategy ................................................................................................................... 7
2.3 Critical Success Factors ................................................................................................................. 8
2.4 Evaluation of the Firms Current Position .................................................................................... 10
3.0 Analysis of Macro Environment Factors ........................................................................... 11

3.1 PESTEL Analysis ........................................................................................................................... 11

3.2 Porter’s 5 Forces for CBL ............................................................................................................. 11
4.0 Cultural Factors .................................................................................................................. 11

5.0 Segmentation...................................................................................................................... 11

5.1 Market Segmentation ................................................................................................................. 11

5.2 Attractiveness of Segmentation.................................................................................................. 12
6.0 Marketing Mix ................................................................................................................... 13

6.1 Price ............................................................................................................................................ 13

6.2 Product ........................................................................................................................................ 13
6.3 Place ............................................................................................................................................ 13
6.4 Promotion ................................................................................................................................... 14
7.0 Conclusion ......................................................................................................................... 14

8.0 References .......................................................................................................................... 14

9.0 Bibliography ...................................................................................................................... 16

10.0 Appendix ............................................................................................................................ 18

4
List of Tables

No Title Page No.

Table 2.1 Benefits in investing in Cambodia 07
Table 2.2 Advantages / Disadvantages of a wholly
owned operation 08
Table 2.3 Market Entry Strategy 08
Table 2.4 Segments for the success of new ventures 08
Table 3.1 PESTEL Analysis 11
Table 3.2 Porter’s 5 Forces 11
Table 4.1 Hofstede's Cultural Model 11
Table 5.1 Basis to identify segments 12
Table 5.2 Segmentation 12

List of Figures

No Title Page No.

Figure 2.1 SWOT Analysis 10

Abbreviations

 Ceylon Biscuits Limited CBL

 Power Distance Index PDI

 Individualism IDV

 Masculinity MAS

 Uncertainty Avoidance Index UAI

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Assumption and Limitation

The research would focus mainly on Confectionary segment under which prominence is given to
Biscuits under the Brand name Munchee.

Considering the cultural factors of Cambodia it is assumed to be similar to Vietnam being its
neabouring country in Asia.

1.0 Introduction on Ceylon Biscuits Limited

CBL was established in late 1960’s when it accepted a contract with CARE International to make
protean rich biscuits to the school children. Upon producing they identified excess produce which
made the company to launch its own brand named Munchee to the local market. As time passed
the organisation was compelled to export its goods to gain higher profitability. Today the company
exports biscuits to 55 plus countries (Sundayobserverlk, 2019) under its own name or been
privately ladled. The company exports around 9,000 metric tons of food products a year with over
70% confectionary falls under Munchee. (Wwwftlk, 2019) No significant market penetration has
been seen, since the products are sold via agents of the respective countries. Considering this
aspect, the assumption is that goods sold by an organisation that has a physical market presence
reach consumer’s heart much sooner than the others. Aligned with its vision we have selected
Cambodia to commence opening a factory and act as an exporting and distribution HUB to enable
entrance of Munchee in to the local market and to use the incentive scheme to export its products
from Cambodia to gain further market share and customer outreach.

2.0 Proposed Country for Expansion

As denoted in the previous chapter the proposal is to establish a presence in Cambodia and have
a factory and exporting and distribution hub established in Cambodia. The following reasons has
been accounted in considering Cambodia as the business venture.

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2.1 Country Selection Justification

Reasons accounted in considering Cambodia as the business venture.

1. Sound macroeconomic policies

2. Political stability

3. Economic growth and open investment Market

In addition to the stability of the country the following benefits prevail as an investor to enter in
to Cambodia which stands attractive from an investment entry stand point.

Benefits of investing in Cambodia is captured under Appendix Table 2.1

Cambodian government has created a special economic zone which has ready access to land,
infrastructure and other services that enables quick set-up and operation of business. Thus
Cambodia acts as a gold mine for CBL to establish a physical presence and enjoy the benefits by
its government to meet the organization objective.

It’s noted by the US Department of State, that during the recent years, Cambodia has attracted
more than USD100Mn of investment from large American companies such as Coca-Cola,
American Licorice and Tiffany & Co. (Santandertradecom, 2019).

In addition as sighted (Foodnavigator-asiacom, 2019) Cambodia market is shown a soaring

demand for overseas brands thus this is a great window to pave wave to have a business
establishment for Munchee.

2.2 Market Entry Strategy

As denoted in (Faoorg, 2019) there are many ways a company can enter in to foreign market. This
includes export, marketing subsidiary, counter trade Licensing, Joint venture and wholly owned
operations.

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The Wholly owned operation segment has been considered as a viable approach for CBL
considering the advantages and disadvantages captured under Appendix Table 2.2

Considering to follow the wholly owned operational model, the market entry strategy is been
defined as captured under Appendix Table 2.3.

Product Positioning

As sighted in (Ukabcorguk, 2019) CBL will position its products as below.

High Quality

Low Price High Price

Low Quality

2.3 Critical Success Factors

Segment for the success of new ventures is captured under Appendix Table 2.4

CBL has experience as to how to enter in to the market. Bangladesh been its first overseas
expansion and success has led to further expansion to Cambodia which provides more incentives
for CBL to sustain and grow. As Denoted under Chapter 1 Tax and Export incentives provides a
financial benefit for CBL to set foot in Cambodia while the option to have 100% foreign ownership
are some of the main reasons for consideration. CBL currently has experience in distributing to
over 55 countries this alone plays a pivotal position to enable CBL enter Cambodia to take
advantage of its Tax free export of its products to other jurisdiction and maintain higher
profitability. CBL under the brand name Munchee is a well-known brand with global recognition.

8
Thus from a market acceptance for Cambodian citizen this product would not be known as an
unknown brand due to its global product presence. The success of CBL is been vested upon its
use of new technology and strong product Research and development. This pave the way to
establish a factory and distribution arm to enable further upskill its capabilities in untouched
markets. Currently CBL has over 60% market share in the domestic saturated market
(Sundaytimeslk, 2019). Thus expansion will enable CBL gain market reach and align with its
vision. It will further enable CBL to upskill its capabilities via its entrant to the new market.

The success in any market is depended on the supply and demand. Considering this, it is estimated
that by 2021 Cambodia’s retail sales to grow to USD 632Mn with a growth rate of 33.5%. Some
of the key growth areas include instant meals, Cereals, Frozen desserts Biscuits etc, thus huge
potential exists in the Cambodian market to have an internationally established set foot in
Cambodia (Foodexportorg, 2019).

Cambodia has a young population and a growing economy. This matches well with CBL success
factors in which the growing economy will provide profitability with the wealth of experience
CBL has on exporting and manufacturing. This will also enable CBL to provide training to the
young population and gain better collaboration and acceptance from the local community by
reducing unemployment and establishing better skilled employees (Foodnavigator-asiacom,
2019).

Apart from importing biscuits there is no internationally recognized business factories established
in Cambodia. There is a Malaysian based company named Julie Biscuits and some local biscuit
companies such as Lyly food industry and Angkor Cookies Company. CBL products compared
stands out in terms of quality, International recognition and Product variations. Hence from a
market competitiveness CBL could take over these small companies within a short turnaround
time (Lylyfoodcom, 2019).

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2.4 Evaluation of the Firms Current Position

SWOT analysis is under appendix Figure 2.1.

The opportunities captured above provides CBL a distinct advantage with its strong brand
positioning to take advantage of the current conducive macro-economic factors. Its strong financial
position and Cambodian Incentive scheme for overseas ventures provides a connecting bridge for
market expansion. While noting Cambodia’s current economic growth (Worldbankorg, 2019)
being on the positive signs with a young labor force, gives CBL the aspect of sustainability.

The threats captured in which a new entrant would take advantages of the incentive program, this
could be mitigated by the strength of CBL who has experience and larger country outreach in
which it has weathered these challenges. Also international brands pricing would be high due to
high reputation of its brand which will not be suitable to the middle income family. In addition
CBL can mitigate pricing by establishing the factory locally and taking advantage of the locally
produced wheat flour to reduce cost (Millermagazinecom, 2014).

Due to concentration given on expansion activities, loss of focus in its current operation is
mitigated by ensuring establishing focus group committees in which the local operations would be
focused by one team while the overseas expansion will be focused by another.

1. Single dependent on Raw Materials (Prima for wheat flour)

2. Low profit margins due to saturated market
3. Limited land capacity for factory expansion.

The dependability of local wheat flour and low profit margins and factory expansion limitations
can be mitigated by expanding its reach to Cambodia where an exporting hub is established. Profit
margins will be increased once Cambodian business commences larger market share.

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3.0 Analysis of Macro Environment Factors

3.1 PESTEL Analysis

PESTEL analysis is under appendix table 3.1.

3.2 Porter’s 5 Forces for CBL

Porters 5 forces as captured under appendix table 3.2, enables us to understand CBL position in
the market and how well it will enable its self to meet its objectives (Cgmaorg, 2013).

Considering the facts captured under the table, it is evident that CBL has an opportunity to show
case its strength in this new market and convert its opportunities to strength to meet its objectives.

4.0 Cultural Factors

As sited in (Mindtoolscom, 2019), Hofstede's Cultural Model is an internationally recognized

standard of understanding differences in culture.

Sri Lanka and Cambodia being Asian countries, it is noted that they share similarities in line with
the Hofstede’s Cultural Model. In line with the above assessment captured under Table 4.0 it is
noted that less resistance is shown on adaptability in Cambodia. Thus this will enable CBL to
seamlessly enter into Cambodia compared to entering in to a western country. There are many
significant disparities in a western country in terms of adaptability (Hofstede-insightscom, 2019).

Cultural factors are captured under Appendix Table 4.1

5.0 Segmentation

5.1 Market Segmentation

The key to success in marketing is to carry out an effective segmentation. This enables the
marketing team to concentrate on a specific segment. ie High income class, middle income class,

11
low income class etc. Once the required audience is established more focus is given in delivering
the respective commodity.

Cambodian Market consist of three income levels. They are high, medium and Low while product
affordability and buying power lays in high and medium income class. Considering biscuits are
mainly consumed as a snack in between main meals, the product reach needs to be convenient.
Our market is thus mainly focused towards retail market where product availability will be
common and targeted towards the high and middle income customer base considering the
dynamics captured under Appendix Table 5.1 as sited in (Qualtricscom, 2019).

Biscuits are consumed by all age groups. However current market focus would be on Youth and
Kids while gradually new products would be introduced to the local market to capture the entire
consumer base in an aim of quality and good brand at an affordable rate.

The close competitors been Julie’s Biscuits, S.B Food Cambodia and Lyly Food Industries are
companies mainly importing and selling biscuit to the local market. There is no established biscuit
manufacturing company in Cambodia as big as CBL. Thus the competitors have mainly looked
over the distribution network as its segmentation to enable availability. CBL focus is on the
income segment to enable purchase of goods to which this segment is primarily in the urban areas
of the country.

CBL considering its previous market experience in selling products to the overseas market has
further experience in segmenting its customer base. Thus the approach is concentrating to ensure
its product is mainly looked towards kids and youth to gain market entrance and there after the
company will differentiate it’s offering to suit each age group with verities of biscuits to reach all
parts of Cambodia.

5.2 Attractiveness of Segmentation

Captured under Appendix Table 5.2.

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6.0 Marketing Mix

The marketing mix is a set of strategies an organization would use to promote its products.

6.1 Price

Considering the economic environment in Cambodia (Santandertradecom, 2019), the product

pricing strategy is as below.

 Competitive pricing – product price is set at a reasonable level, compared to competitors.

 Product line pricing – different products will have different pricing. Ex. Heathier
products would be cheaper.

 Bundled products – This enables family packs being produced at reduced price.

 Value based pricing – will capture good quality and value added service at a competitive
price.

Considering the above CBL Biscuits would be offered at a very competitive price to enable
lower and middle class families to afford it.

6.2 Product

Nutrition benefits would be demonstrated during promotional periods of the said product. Product
variation enables consumers to try various types of biscuits, while they could be segmented to
nutrients biscuits, health biscuits etc.

6.3 Place

Product availability to enable target consumers purchasing same is looked at this junction. CBL
having experience in exporting to more than 55 countries will ensure that it has a good distribution
network established in Cambodia to meet the demands of the consumer. Once urban areas are fully
secured. CBL would consider to further penetrate to rural areas.

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6.4 Promotion

Pull strategy will be used to sell the commodity to our consumers. This will established by
aggressive marketing to campaign the new product and retail stores providing free sachets to attract
taste buds of our consumers.

7.0 Conclusion

The market entry strategy and the experience in selling the product to over 55 countries reflects
CBLs ability to look beyond new horizons. The factory established in Cambodia along with the
export hub will provide opportunities to reduce unemployment in the country and CBL to be
considered as a household product among the high and middle income families, while CBL gaining
higher market share and profitability. The incentive scheme will act as a stepping stone for CBL
to gain market leadership in Cambodia within 5 years by breakeven of initial investment.

8.0 References

 Cgmaorg. 2013. CGMA . [Online]. [1 May 2019]. Available from:

https://www.cgma.org/resources/tools/essential-tools/porters-five-forces.html

 Faoorg. 2019. Faoorg. [Online]. [1 May 2019]. Available from:

http://www.fao.org/3/w5973e/w5973e0b.htm

 Foodexportorg. 2019. Foodexportorg. [Online]. [1 May 2019]. Available from:

https://www.foodexport.org/get-started/country-market-profiles/southeast-asia/cambodia-
country-profile

 Foodnavigator-asiacom. 2019. Foodnavigator-asiacom. [Online]. [1 May

2019]. Available from: https://www.foodnavigator-asia.com/Article/2018/05/23/Food-
and-beverage-in-Cambodia-Soaring-demand-offering-huge-potential-for-overseas-brands

 Foodnavigator-asiacom. 2019. Foodnavigator-asiacom. [Online]. [1 May

2019]. Available from: https://www.foodnavigator-asia.com/Article/2018/05/23/Food-
and-beverage-in-Cambodia-Soaring-demand-offering-huge-potential-for-overseas-brands

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 Hofstede-insightscom. 2019. Hofstede Insights. [Online]. [1 May 2019]. Available from:
https://www.hofstede-insights.com/country-comparison/

 Indexmundicom. 2019. Indexmundicom. [Online]. [1 May 2019]. Available from:

https://www.indexmundi.com/cambodia/age_structure.html

 Lylyfoodcom. 2019. Lylyfoodcom. [Online]. [1 May 2019]. Available from:

https://www.lylyfood.com/en/home

 Millermagazinecom. 2014. Miller Magazine. [Online]. [1 May 2019]. Available from:

http://www.millermagazine.com/english/grain-and-flour-market-in-cambodia/

 Mindtoolscom. 2019. Mindtoolscom. [Online]. [1 May 2019]. Available from:

https://www.mindtools.com/pages/article/newLDR_66.htm

 Phnompenhpostcom. 2019. Phnompenhpostcom. [Online]. [1 May 2019]. Available

from: https://www.phnompenhpost.com/business/demand-flour-rise

 Qualtricscom. 2019. Qualtrics. [Online]. [1 May 2019]. Available from:

https://www.qualtrics.com/experience-management/brand/what-is-market-segmentation/

 Santandertradecom. 2019. Santandertradecom. [Online]. [1 May 2019]. Available from:

https://en.portal.santandertrade.com/establish-overseas/cambodia/investing-3

 Scribdcom. 2019. Scribd. [Online]. [1 May 2019]. Available from:

https://www.scribd.com/doc/52232605/Strategic-Management-Practices-at-Munchee

 Searchnewworldcom. 2019. Searchnewworldcom. [Online]. [1 May 2019]. Available

from: https://www.searchnewworld.com/search/search2.html?partid=imnsknsch

 Sundayobserverlk. 2019. Sunday Observer. [Online]. [1 May 2019]. Available from:

http://www.sundayobserver.lk/

 Sundaytimeslk. 2019. Sundaytimeslk. [Online]. [1 May 2019]. Available from:

http://www.sundaytimes.lk/081019/FinancialTimes/ft319.html

 Sundaytimeslk. 2019. Sundaytimeslk. [Online]. [1 May 2019]. Available from:

http://www.sundaytimes.lk/110213/BusinessTimes/bt11.html

 Tradingeconomicscom. 2019. Tradingeconomicscom. [Online]. [1 May 2019]. Available

from: https://tradingeconomics.com/cambodia/unemployment-rate

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  Transparencymarketresearchcom. 2019. Transparencymarketresearchcom. [Online]. [1
May 2019]. Available from:
https://www.transparencymarketresearch.com/pressrelease/biscuits-market.htm

 Ukabcorguk. 2019. Ukabcorguk. [Online]. [1 May 2019]. Available from:

http://www.ukabc.org.uk/wp-content/uploads/2017/04/FMCG-in-Cambodia-Executive-
Summary.pdf

 Ukabcorguk. 2019. Ukabcorguk. [Online]. [1 May 2019]. Available from:

http://www.ukabc.org.uk/wp-content/uploads/2017/04/FMCG-in-Cambodia-Executive-
Summary.pdf

 Ukessayscom. 2019. UKEssayscom. [Online]. [1 May 2019]. Available from:

https://www.ukessays.com/essays/economics/pestel-analysis-and-diamond-theory-of-
cambodia-economics-essay.php

 Worldbankorg. 2019. World Bank. [Online]. [1 May 2019]. Available from:

https://www.worldbank.org/en/country/cambodia/overview

 Worldbankorg. 2019. Worldbankorg. [Online]. [1 May 2019]. Available from:

https://data.worldbank.org/?locations=KH-XP-XD-XT

 Worldpopulationreviewcom. 2019. Worldpopulationreviewcom. [Online]. [1 May

2019]. Available from: http://worldpopulationreview.com/countries/cambodia-
population/

 Wwwftlk. 2019. Wwwftlk. [Online]. [1 May 2019]. Available from:

http://www.ft.lk/article/384238/Munchee-largest-exporter-of-biscuits-in-Sri-Lanka

 Wwwftlk. 2019. Wwwftlk. [Online]. [1 May 2019]. Available from:

http://www.ft.lk/article/368316/Munchee-enters-Bangladesh--sets-up-a---3-m-factory

9.0 Bibliography

 Broadbent, , M & Cullen, J (2012). Managing Financial Resources. [Online]. (3

ed.). : Routledge. [15 January 2019]. Available from:
https://books.google.lk/books/about/Managing_Financial_Resources.html?id=vkvUJkfY
Rh4C&redir_esc=y
 Cleverismcom. 2017. Cleverism. [Online]. [15 January 2019]. Available from:
https://www.cleverism.com/strategy-implementation-process/

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 Hbrorg. 2008. Harvard Business Review. [Online]. [15 January 2019]. Available from:
https://hbr.org/2008/06/the-secrets-to-successful-strategy-execution
 Ibrahim khan, M & Rafiqul islam, M (2007). True Sustainability in Technological
Development and Natural Resource Management. [Online]. :Nova Publishers. [15
January 2019]. Available from:
https://books.google.lk/books/about/True_Sustainability_in_Technological_Dev.html?id
=GL232LKWRzgC&redir_esc=y
 Institute of leadership & management & Cullen, J (2007). Controlling Physical
Resources. [Online]. (4 ed.). : Routledge. [15 January 2019].Available from:
https://books.google.lk/books/about/Controlling_Physical_Resources.html?id=rwX0jKie
8XwC&redir_esc=y

 Insurancejournalcom. 2003. Insurance Journal. [Online]. [15 January 2019]. Available

from: https://www.insurancejournal.com/magazines/mag-
mindyourbiz/2003/07/21/31007.htm

 Jeffrey hayzlett. 2016. Entrepreneur. [Online]. [15 January 2019]. Available from:
https://www.entrepreneur.com/article/269665
 Onstrategyhqcom. 2019. OnStrategy. [Online]. [15 January 2019]. Available from:
https://onstrategyhq.com/resources/strategic-implementation/
 Pinterestcom. 2019. Pinterest. [Online]. [15 January 2019]. Available from:
https://www.pinterest.com/pin/18366310961592071/
Oxfordcollegeofmarketingcom. 2018. Oxford College of Marketing Blog. [Online]. [15
January 2019]. Available from:
https://blog.oxfordcollegeofmarketing.com/2018/04/23/what-is-mendelows-matrix-and-
how-is-it-useful/
 Slidesharenet. 2019. Slidesharenet. [Online]. [15 January 2019]. Available from:
https://www.slideshare.net/SmartAutomation/environment-day-2014-smart-home-
automation
 Sumantran , V, Fine , C & Gonsalvez, D (2017). Faster, Smarter, Greener: The Future of
the Car and Urban Mobility. [Online]. : MIT Press. [15 January 2019]. Available from:
https://books.google.lk/books/about/Faster_Smarter_Greener.html?id=jlA4DwAAQBAJ
&redir_esc=y
 Ukessayscom. 2019. Ukessayscom. [Online]. [15 January 2019]. Available from:
https://www.ukessays.com/essays/management/stakeholder-analysis-of-mendelow-
matrix-management-essay.php

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10.0 Appendix

Benefits in investing in Cambodia

1. 100% foreign ownership will enable CBL to establish its presence without having a
Joint Venture operation.
2. Tax free holiday periods up to eight years and thereafter a 20% corporate tax
3. Option to bring down manufacturing goods via duty-free import on capital goods
4. No restrictions on capital repatriation
5. Exports been exempted from taxes

Authors work Table 2.1

Advantages of a wholly owned operation Disadvantages of a wholly owned operation

 Reduced Cost and Capital expenditure-  Reduced market information.
Existing and tested product marketing
material and machinery can be used  Higher degree of coordinating
without re developing strategies and
new products
 Controlling reduced expenditure on
 Reduced Risk and high local
market development
knowledge and Credibility- due to
experience in local market and been an

18
 exporter for 55 plus countries the risk
is minimized in terms of knowledge

Authors work Table 2.2

Market Entry Strategy

1. CBL to be listed in the Colombo stock exchange.
Expansion to overseas ventures requires sizeable funding. Thus in order to secure funding
arrangements of an entity which is currently boasting of been over LKR12Bn worth is to be
listed in the local stock exchange. This is to enable the client via its initial public offering to
secure funding arrangements for the proposed factory and distribution HUB (Scribdcom,
2019).
2. Market Study in Cambodia
Consumer pulse check is a key for success. Thus a study on confectionary consumer buying
patterns in Cambodia along with a study on the pros and cons in having a factory and distribution
HUB is needed to be evaluated prior to entering the market.
3. Creation of a Research and Development Team
The research team will enable to provide, in-depth guidance on consumer needs and wants to
enable creation of tailored products to meet local requirements.
4. Establish Manufacturing and Export HUB
Taking in to consideration the incentive scheme of the government, enables proceeding with the
plant establishment.
5. Position the product
The product would be positioned at the middle income earning market. Considering they are
more towards quality and would not be much price sensitive.
6. Brand Ambassadors

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 CBL symbolic representatives in Cambodia will help gain market acceptance by contributing
to the economy of Cambodia by creating jobs (Tradingeconomicscom, 2019).
7. Creation of Strong sales team
Cambodian market is filled with young and tech savvy blood which could be used to create a
strong sales force to enable reach the entire market in Cambodia to distribute its products
locally. As sighted in (Worldpopulationreviewcom, 2019) and (Indexmundicom, 2019).
Authors work Table 2.3

Segments for the success of new ventures

1. Experience in establishing factories locally as well as Overseas. (Wwwftlk, 2019)
2. Experience in distributing confectionary products to around 55 plus countries.
3. None requirement to have a Joint Venture operation in Cambodia
4. International recognition awards
5. Strong brand positioning and image
6. Use of sophisticated technological innovations
7. Strong Product Research and Development capabilities
Authors work Table 2.4

PESTEL Analysis

Political
Cambodia acts as a conducive environment for manufacturing and as an exporting hub. The
government has provided incentives such as 100% ownership, tax free holiday periods along
with exceptions from export tax. Considering these, it is well noted that, most of the emerging
countries such as Sri Lanka having an established presence in Cambodia with stable political
environment acts as a conducive environment for business development (Worldbankorg, 2019).
Economic
Cambodia compared to Sri Lanka has doubled the economic growth and is one of the fastest
growing economics in the world. Focusing on the gross domestic products, being at the range

20
 of 7 encourages any investor to invest in a stable economy like Cambodia (Worldbankorg,
2019).
Social Factors
Considering the Social background of Cambodia, it is noted that Cambodians are more
conscious on quality than purchasing cost effective consumables. Their spending patterns on
food items are relatively higher than non-consumable items. This is an encouraging factor to
CBL where although locally its products are high in pricing, the quality of biscuits are better
compared to Cambodian market. This would further encourage CBL to penetrate the market
with quality products (Ukabcorguk, 2019).
Technological Factors
Manufacturing plants imported from Europe as well as the Cambodian youth been tech savvy
will help CBL take advantage in manufacturing. CBL further ensures quality is consistent and
thus use of similar equipment provides comfort and ease in manufacturing.
Environmental
Cambodia’s business environment is conducive and is well defined by its policies and
incentive programs made available to new investors. This acts as a conducive environment to
establish business presence in Cambodia.
Legal
The constitution written in 1993 has established stable political environment, compared to past
decades of war and internal strife (Ukessayscom, 2019).
Authors work Table 3.1

Porter’s 5 Forces

Competitor Rivalry
CBL has market leadership above 62% in the current market it operates. The market in
Cambodia does not reflect a key threat in terms of competitor rivalry considering the players in
the current market does not have an extensive product offering to meet the client expectations.
While this would be a distinct advantage for CBL it should keep close track of any new market
entrants that might be able to veer off CBL form its advantage it holds.

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 CBL would be able to sustain in the market via the use of a low cost execution taking in to
account the incentives provided by the Cambodian government and by operating in a more
efficient mode in the proposed market.
Threat of new entrants
Due to the incentives provided by the government is conducive this will open doors to new
entrants. However considering the lack of skilled resources, infrastructure and high cost of
energy will delay or act as road blocks for new entrants. As sited in (Santandertradecom, 2019)
CBL keenness for investment would pave in a positive aspect.
Power of Suppliers
Survival of CBL in Cambodia is mainly dependent over the raw material of Wheat floor. The
limitation in Sri Lanka is that it’s solely dependent over one supplier while as sited
(Phnompenhpostcom, 2019) in Cambodia there is two wheat mills. Thus the power of suppliers
would remain marginally high. However this will provide an opportunity for better bargaining
with the suppliers to obtain wheat at a competitive price.
Power of Buyers
Historically Cambodia was a country in which its citizen enjoyed their rice. However with the
western world influence the demand for wheat products has risen since 2015
(Phnompenhpostcom, 2019), demarcating a shift in consumer buying patterns. Thus the
bargaining power of the consumer is in the constant rise. With multiple confectionary companies
establishing presence in Cambodia along with importing of confectionary items, has shown an
increase to meet consumer demands. This reflects a demand for a quality biscuits at a
competitive price.
Authors work Table 3.2

Hofstede's Cultural Model

Power Distance Individualism Masculinity Vs Uncertainty Long Vs Short-

Index Vs Collectivism Femininity Avoidance Term
Index Orientation

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 High PDI Score Low IDV Score Low MAS Score Low UAI Score Long Term
More complex People work for More focus on Openness to Orientation
hierarchies. rewards. quality of life. change / Modest
innovative. behavior.
Acknowledge Suppress Success is
Leaders. feelings and achieved through Titles are not Avoid bosting of
Being aware that emotions to collaboration. important. own –self.
answers are maintain peace. Flexibility in Respects people Less cross
given by the top. workplace and who cope with questions on
Avoids negative work-life all “Why”.
feedback. balance is circumstances.
important.
Supportive to
open-ended
learning /
decision making.
Authors work Table 4.1

Basis to identify segments

Demographic Behavioral
Age – Youth and Kids Brand Loyalty - Promotional offers
Income - Middle and High income earners
Geographic Psychographic
Urban Areas Life Style -Packaging Attractiveness
Retail Markets Social and Class -Use of Brand Ambassadors
Authors work Table 5.1 (as sited in (Qualtricscom, 2019).)

Segmentation

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 Measurable
The segment selected is measurable based on the below calculation by validation of market data
(Searchnewworldcom, 2019).
Size of a segment = Number of possible middle income families x Size of purchase x Rate of
purchase
Accessible
The product could be only sold if it is freely available to the general consumers. Accessibility
to rural areas reflects transport difficulties. However at initial stages, considering our customer
base is the middle income customers, the product will be accessible in the urban areas.
Substantial
The initial segment of approach been the middle income population accounts to Circa 8 Bn from
a population of 16Bn as sited in (Worldbankorg, 2019). Considering the high income population
been 1Bn there will be a substantial proportion of income generated via this segment considering
the fact that we target more than 50% of the customer base.
Differentiable
Customer segmentation has been made by identifying the purchasing power, which is the high
and middle income individuals. This does not overlap to the lower income individuals. Hence
they would not be in a position to purchase the commodity more often.
Actionable
The segment identified being the youth and children of the middle income families would seek
a mid-time snack and here the affordability would play a pivotal role to purchase the
commodity. Thus creating a link between the seller and the consumer.
Authors work Table 5.2

SWAT Analysis

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 • Established market • Single dependent on Raw
leadership Materials (Prima for wheat
• Local and Overseas well flour)
planned distribution • Low profit margins due to
network saturated market
• Strong brand image • Limited land capacity for
• State of the art technological factory expansion.
innovation
• Product innovation Strength Weakness

Oppertunities Threats

• Overseas expansions • New entrants to Cambodia

• Positive signs for trade taking advantage of incentive
agreements with Cambodia schemes
• Incentive based programs • Price competition in new
for overseas establishments market
in Cambodia • Loss of focus due to
• Growing economic market expansion to overseas market
in Cambodia

Figure 2.1

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