Case Study 1

FRENCH WINERY

Course Number : BICG9202

Section Number : 02

Date of Submission : March 24, 2020

Student Name : Mohammed Jasim

Student ID : 4381047
Instructor’s Name : Jayesh Menon
Case Study Answers
1. What are the main market entry barriers that Chateau Camargue faces in entering the
Indian wine market?
Answer : The major market entry hurdles for Chateau Camargue in India will be : -
 The high preference of Indian consumers for hard liquor and beer with high
ABV(Alcohol by volume). As a result, wine with low ABV(Alcohol by volume) possesses a
very less market share.
 There exist complicated social and cultural frameworks in different parts of the country
that prohibits consumption and sale of alcoholic beverages.
 There also exists religious and common belief moving towards the prohibition of
alcoholic beverages.
 There will be difficulty in gaining significant market share because 90 percent of the
total wine demand is already met by the existing 3 companies.
 Since the sale of alcoholic beverages is prohibited in various Indian states, the company
will face difficulty when it comes to the expansion of its consumer base across the
states.
2. In your opinion, what would be the best market entry strategy for Chateau Camargue to
overcome its financial difficulties? Explain your reasoning.
Answer : In my opinion, I feel that Chateau Camargue should enter the Indian market
through a joint venture because : -
 As we all know, the joint venture involves cooperation with existing companies and
sharing returns and risks, Chateau Camargue will be able to expand its business in the
Indian market involving a minimum amount of financial cost.
 Since there exists a sharing of profits and losses, the financial risk involved would be
low.
 In India, there exist various legislative barriers associated with the sale of alcoholic
beverages. Therefore, the company will be able to overcome these legislative barriers
easily with the help of the joint venture.
 Through a joint venture, the company will be able to gain access to a significant amount
of consumer base. This would be helpful for the company in expanding its market share
rapidly.
 After establishing significant goodwill and market share in India, Chateau Camargue will
be free to terminate its joint venture and carry on the business independently.
3.Should Chateau Camargue consider a long-term foreign direct investment strategy in
India? Explain your reasoning.
Answer : Yes, Chateau Camargue should definitely think about investing in India for a long
term period because : -
 India is unlocking its economy to foreign competition by making variations in
manufacturing and instituting measures to encourage foreign trade.
 There exists a remarkable demand for high-quality wines in India because the
domestically produced wines possess low quality. This denotes a significant opportunity
for Chateau Camargue in the Indian market with the help of its high-quality products.
 The government has encouraged the consumption of wine through duty exemptions.
Since there exists an increase in wine consumption in the country, the company will be
able to have potential growth in India.
 Since the European wine market remains saturated, it is important for Chateau
Camargue to expand to India to ensure its survival and growth.