BSBMKG605 Evaluate international marketing

opportunities

Introduction:

Bounce Fitness is a multi-center provider of fitness and weight training across Australia. Two years ago
Bounce Fitness developed the Smart Weights which are a new style weight useful for toning and bulking.
It can be used in traditional settings such as fitness centers and gyms, or in the home as a productive
adjunct to the home fitness regime. This product has been a great success in Australia and the intention
is to export into New Zealand where Bounce Fitness currently has four Centers operating successfully
where the Smart Weights are being used. Customers have sought to purchase these weights for
personal use as it provides them with a point of differentiation to the routine fitness workouts and
equipment. In the past two years, demand for the Smart Weights has increased and Bounce Fitness has
chosen to capitalize on this demand.

Sales Forecast

Bounce Fitness is a multi-center provider of fitness and weight training across Australia. Two years ago,
Bounce Fitness developed the Smart Weights which are a new style weight useful for toning and bulking.
It can be used in traditional settings such as fitness centers and gyms, or in the home as a productive
adjunct to the home fitness regime.

Market Summary

Bounce Fitness possesses good information about the market and knows a great deal about the
commit attributes of the targeted customers. This information will be leveraged to better understand
who is served, their specific needs, and how Bounce Fitness can better communicate with the target
market.

http://bouncev1.precisiongroup.com.au/infrastructure/current-projects/

Project Stage 1

Review global market environment

New Zealand is the 57th largest export economy in the world and the 41st most complex economy
according to the Economic Complexity Index (ICE). In 2017, New Zealand exported $ 37.3 billion and
imported $ 36.3 billion, resulting in a positive trade balance of $ 988 million. In 2017, New Zealand's
GDP was $ 205 Billions, and its per capita GDP was $ 41.1 Thousands.

New Zealand's main exports are Concentrated Milk ($ 5.34 Billions), Sheep and Goat ($ 2.36 Billions),
Butter ($ 2.33 Billions), Rough Wood ($ 2 Billions) and Frozen Beef ($ 1.79 Billions)), using the 1992
revision of the HS (Harmonized System) classification. Its main imports are Cars ($ 3.81 Billion), Crude
Petroleum ($ 1.95 Billion), Refined Petroleum ($ 1.4Billion), Delivery Trucks ($ 1.35 Billion) and
Transmission Equipment ($ 1.02 Billion).

New Zealand's top export destinations are China ($ 8.79 billion), Australia ($ 5.61 billion), the United
States ($ 3.61 billion), Japan ($ 2.39 billion) and South Korea ($ 1.14 Billions). Top import sources are
China ($ 7.28 billion), Australia ($ 4.51 billion), the United States ($ 3.37 billion), Japan ($ 2.79 billion)

Laven basnet pr3229 1

 BSBMKG605 Evaluate international marketing
opportunities

and Germany ($ 1.88) Billion).New Zealand is an island and borders Australia, Fiji, Norfolk Island and
Tonga by sea.

New Zealand has evolved in recent years from an agrarian economy dependent primarily on the British
market to a modern market economy with a significant industrial component and able to compete
globally. Its dynamic economy results in a significant Gross Domestic Product and mainly in a high per
capita GDP (US $ 28,000 in 2010). Its main economic activities are agriculture, horticulture, fishing and
forestry. This country also has substantial manufacturing industries, tourism and services. It is important
to highlight the heavy, aluminum and steel industries concentrated in the southern and northern
regions respectively. The official currency of the country is the New Zealand dollar.

New Zealand is part of the international treaty called APEC (Asia-Pacific Economic Cooperation),an
economic bloc aimed at making the Pacific a free trade area encompassing Asian, American and
Oceanian economies.

New Zealand's economy is dependent on foreign investment. However, the coalition government
between the Labour Party and New Zealand First – a nationalist party – passed the Overseas Investment
Amendment Act of 2018 to restrict FDI in areas such as ‘sensitive’ land and housing (New Zealand
Parliament). New Zealand was ranked 1st out of 190 countries in the 2019 Doing Business Report
published by the World Bank, the same spot as in 2018.

https://www.mfat.govt.nz/en/trade/our-work-with-the-wto/

https://www.parliament.nz/resource/en-
NZ/SCR_78504/8a4060ab0694885da41dbbaa4e800a49e5a88c2b

https://www.parliament.nz/en/pb/bills-and-laws/bills-proposed-laws/document/BILL_75755/overseas-
investment-amendment-bill

Country Comparison for the Protection of Investors

NEW ZEALAND OECD UNITED STATES GERMANY

Index of 10.0 6.0 7.0 5.0
transaction
transparency
Index of Manager 9.0 5.0 9.0 5.0
responsibility
Index of 8.0 7.0 4.0 8.0
shareholder’s
power
Index of investor 8.3 6.5 6.5 6.0
protection

Laven basnet pr3229 1

 BSBMKG605 Evaluate international marketing
opportunities

About free trade agreements

A free trade agreement (FTA) between two countries or a group of countries can be used to set the rules
for how countries treat each other when it comes to doing business together. While we look to pursue
New Zealand’s trade goals through the World Trade Organization (the WTO), involving over 160
economies, the WTO’s consensus decision making process means that progress can be slow, and
agreements may not address the specific interests and issues of individual countries. FTAs offer an
additional avenue to advance our trade interests.

The focus of an FTA is primarily on economic benefits and encouraging trade between the countries by
making it more efficient and profitable. Agreements usually remove tariffs on goods, simplify customs
procedures, remove unjustified restrictions on what can or can’t be traded, and make it easier for
businesspeople to travel or live in each other’s country. But FTAs may also have political, strategic, or aid
benefits.

Taxes in New Zealand are collected at a national level by the Inland Revenue Department (IRD) on behalf
of the Government of New Zealand. National taxes are levied on personal and business income, and on
the supply of goods and services. There are no capital gains tax, although certain "gains" such as profits
on the sale of patent rights are deemed to be income – income tax does apply to property transactions
in certain circumstances, particularly speculation. There are currently no land taxes, but local property
taxes (rates) are managed and collected by local authorities. Some goods and services carry a specific
tax, referred to as an excise or a duty, such as alcohol excise or gaming duty. These are collected by a
range of government agencies such as the New Zealand Customs Service. There is no social security tax.

Types of taxable income

 salary and wages

 business and self-employed income

 income from investments

 rental income

 overseas income

New Zealand has a unique and dynamic culture. The culture of its indigenous Māori people affects the
language, the arts, and even the accents of all New Zealanders. Their place in the South Pacific, and their
love of the outdoors, sport, and the arts make New Zealanders and their unique culture in the world.
New Zealanders are largely sophisticated and highly educated urban dwellers. Members of a unique and
vibrant multicultural society, New Zealanders are embracing 21st century technology and culture in
record numbers. But New Zealanders also have a background of quiet but rugged individualism, self-
reliance, and a genius for invention - qualities still evident in the population today. Customer service is
the way a business or individual understands and meets his customers 'needs. When a company

Laven basnet pr3229 1

 BSBMKG605 Evaluate international marketing
opportunities

provides effective customer service, clients will continue to do business with that company and may
recommend it to others.

Many factors of customer service are vital to a business' survival and growth.

 Team

 Effective Communication

 Compassion

 Professionalism

 Reliability and Responsibility

To keep customers satisfied with your business, show that your company is reliable and responsible.
Follow through with promises and always strive to correct mistakes in any way possible. Keeping the
customer happy with your company is one of the most important factors of customer service. In 2017,
New Zealanders spent approximately $ 10 billion buying products online, an increase of 9%. And while
we've been tracking online purchasing across specific categories for some time, we're starting to see this
take shape in the fast-moving consumer goods (FMCG) sector. Online grocery, which currently accounts
for 3% -4% of total grocery sales in New Zealand, continues to drive growth, and we expect growth to
accelerate in 2019 as retailers meet rising consumer demand with continued rollout of their e-
commerce programs.

Many shoppers are growing more comfortable with buying online, particularly with respect to previous
barriers to adoption: they trust that they are purchasing genuine products, using secure payment
methods, that their purchases will arrive safely, and that their items will arrive on time and in good
condition. Within the FMCG broader sector, we've seen an increase in shoppers' likelihood to buy
packaged groceries, household cleaning products and paper products, and wine and alcoholic beverages
online compared with last year. As a result, dollar sales across FMCG supermarket are growing at a rate
of 37% (in dollar terms vs. last year), while total grocery sales are growing at 3%. Consequently,
ecommerce represents approximately 59% of supermarket dollar growth, compared to brick-and-mortar
sales, which represents 41% share of dollar growth. Given the sales growth and future potential, head-
to-head competition among global players, local vendors and meal kit providers in the FMCG sector will
intensify. To stay ahead, fresh food manufacturers will need to continue offering solutions to help
shoppers overcome their hesitations to buy online. Impulse category manufacturers will need to find
new ways to maintain relevance in an online basket. In an increasingly competitive landscape, we
predict that in 2019, manufacturers and retailers will increase their focus on supply chain efficiencies,
assortment optimization, price and promotion efficiencies and profitability analytics.New Zealand
Government signed off on a reform package aimed at improving the Telecommunications Act and
modernizing the telecom sector. Telecommunications in New Zealand are fairly typical for an
industrialized country.

Spark New Zealand, Vodafone New Zealand, 2degrees and Vocus provide most services. Mobile
telephone services are provided by Spark, Vodafone and 2degrees, although several smaller mobile
virtual network operators also exist. Fixed-line broadband and telephone services are largely provided

Laven basnet pr3229 1

 BSBMKG605 Evaluate international marketing
opportunities

through copper-based networks, although fiber-based services are increasingly common.Fixed-line

broadband and telephone services are largely provided through copper-based networks, although fiber-
based services are increasingly common. Australia-New Zealand Trade Agreement on Economic
Relations (ANZCERTA; Closer Economic Relations, CER), established in 1983, has become the principal
instrument for managing economic relations between Australia and New Zealand. New Zealand. It was
planned to become an agreement between the two countries, whose main objective is the creation of a
free trade area. Trade barriers are government policies and regulations that favor local suppliers. These
might include unjustified standards, testing or certification procedures, investment or visa restrictions.

Likely impact on Bounce Fitness:

In developing countries, IT and communication or rather e-commerce growth is substantial. Technology

effectiveness is essential in E-Commerce success. However, human, economic, and other organizational
issues must be considered as well. In this study, we evaluated the current status of E-Commerce in
Developing countries. The evaluation of current status reveals opportunities that should be seriously
tackled by organizations, if they are to survive the consequences of globalization and open markets.
There should be an immediate implementation of a governmental infrastructure to support e-
commerce. This thesis explored the areas enabling and huddles to the development of ecommerce.
Online consumers face problems concerning security and privacy. They are exposed with online risk such
as hacker mischiefs.

Moreover, when buyers make payment using credit cards, they are exposing their banking information
which could also be manipulated by hackers. The results of this research showed that majority of the
respondents felt that internet shopping is risky due to the same reason. Amongst the perceived risks is
financial, product performance, social, psychological and time convenience loss. Other than stolen credit
card information, there are also risks in delivery. The time taken for delivery may take quite some time,
therefore, anything could happen in the process of delivery. Buyers may lose the item. Online vendors
might not be responsible for the loss, and this leaves the buyers to bear all the consequence. When the
perceived risk is greater, the relationship between intention and online purchasing will be weakened.
factors influencing e-commerce.

The implementation of an effective Internet e-commerce solution in Developing countries or other

country that want to develop its e-commerce system can consider the following key steps: Developing
strategy; before implementing Internet e-commerce, an organization must clearly define its goals. Many
companies create goals that are not measurable or specific. Assessing readiness; before taking on the
complexities (and risks) associated with implementing Internet e-commerce, an organization and its
management should take stock of their current systems and capabilities. Four key drivers predict an
enterprise’s ability to succeed in e-commerce. These four drivers are: leadership, governance;
competencies; and technology. Designing the project; Although projects will differ greatly in the details,
there are some common requirements for implementing Internet e-commerce, including: managing the
project, developing an outsourcing strategy, selecting an Internet service provider, selecting e-
commerce service providers; and designing website security. Integrating the solution; In developing an
Internet e-commerce platform, an organization must also consider how to integrate its e-commerce
applications with its other business processes. For example, the richness of corporate intranet
applications positively affects e-commerce capabilities. Extending intranet applications into the Internet

Laven basnet pr3229 1

 BSBMKG605 Evaluate international marketing
opportunities

permits an organization to provide more value to customers in several ways: real-time access to
information; and ability to perform business transactions. Measuring effectiveness: Given the major
investment that implementing e-commerce entails, it is only common sense to measure the return.
Successful e-commerce companies have serious and accountable metrics and clear agreements about
using them across the organization. It is in the appropriateness and completeness of the metrics
selected that typically set successful e-commerce implementations apart from the ones that are
unsuccessful.

Project Stage 2

Assess international business and electronic commerce market factors

Political and Legal Factors:

Factors to consider Effect on Bounce Fitness

1. Trade control A very tight trade control would make it difficult
to export goods.
2. Government Government involvement with unions could
involvement in trade create restrictions on the distribution and sale of
unions and
products.
agreements
3. Fiscal Policy A very strict fiscal policy would create obstacles
to the export process.
4. Bureaucracy Bureaucracy would impact the export process
5. Tax increase or Tax increases would directly impact product /
decrease service values

Economic Factors:

Factors to consider Effect on Bounce Fitness

1. Exchange Rate High rates drive up product costs making sales
difficult
2. Tax Rate High rates drive up product costs making sales
difficult
3. Labor If the Labor force in the country is expensive the
company will need to outsource cheaper Labor in
another country
4. Inflation Inflation hits product prices directly
5. Wages High wages impact on hiring skilled Labor

Laven basnet pr3229 1

 BSBMKG605 Evaluate international marketing
opportunities

Socio-cultural factors:

Factors to consider Effect on Bounce Fitness

1. Role and Status in Social issues can directly affect product sales
Society
2. Education and The average level of education in a society affects
Language theinterests and sophistication of consumers.
3. Social organization People's level of acceptance for fitness products
can be a determining factor in company actions.
4. Country Culture Country culture may not accept this type of product
5. Reference Group and The product may not be well accepted if a group of
Family people do not use it.

Technological Factors:

Factors to consider Effect on Bounce Fitness

1. Cybercrime increase People may be afraid to shop online due to
cybercrime, and this can impact sales
2. technological If people in the country do not have access
obsolescence to current technology, sales may not reach
expected levels.
3. Influence of Using the wrong technology for branding
technology on can damage sales.
marketing
4. Internet A bad internet can make online sales
difficult
5. Information security People may be afraid of your data being
exposed because it is a foreign company.

Laven basnet pr3229 1