Diploma in Business Management

International College of Business and technology

International Business

Sayuri Hansika Welagedara

KD/HNDBSM/56/17

ICBT Kandy Campus

Submitted to: MR. Subodha Perera

18/06/2020

1|Page
KD/HNDBSM/56/17
 Assignment Cover Sheet

Qualification Module Number and Title

HND in Business Management BHND5201 International Business

Student Name & No. Assessor

Subodha Perera

Hand out date Submission Date

05.05.2020
Assessment type Duration/Length of Weighting of Assessment
Written Report Assessment Type
3000 Words 100%

Learner declaration

I, Sayuri Welagedara certify that the work submitted for this assignment is my own and research
sources are fully acknowledged.

Marks Awarded
First assessor

IV marks

Agreed grade

Signature of the assessor Date

2|Page
KD/HNDBSM/56/17
Contents
Acknowledgement ................................................................................................................................. 4
Executive Summary .............................................................................................................................. 4
Introduction ........................................................................................................................................... 5
1.0) Advantages and disadvantages of doing international trade to Dumbara Natural Foods. .......... 7
2.0) Country evaluations and there impact to the two internationalisation objectives of Dumbara
Natural foods........................................................................................................................................... 9
2.1) Marketing the product in Austria ..................................................................................................... 9
2.2)Producing and Marketing the product in India ............................................................................... 13
3.0) Modes of Entry to the evaluated countries ................................................................................ 14
4.0) An international strategy for producing and marketing overseas along with the marketing mix
for the New markets .............................................................................................................................. 16
4.1) International Strategies ............................................................................................................. 17
Conclusion ............................................................................................................................................ 23
References ............................................................................................................................................. 24

3|Page
KD/HNDBSM/56/17
Acknowledgement

I receive this chance to present my gratitude to everyone who supported me throughout this
assignment.
Firstly, I would like to thank respectably for our lecturer MR. Subodha Perera for the guidance,
encouragement and the inspiration given from the beginning of this module (International
Business) till the end of the assignment submission. Also, I’m thankful for him for tutoring us
with this IB module which is very valuable and helpful for us as undergraduates. It is a great
honor for me to write this few words to thank the lecturer.

And also, I would like to thank my parents and my friends for providing relevant assistance for
me in doing this individual report. I am sincerely grateful for them in sharing their truthful
feedbacks and views regarding this assignment.

4|Page
KD/HNDBSM/56/17
Executive Summary

This report is prepared based on a local established organisation named Dumbara Natural
Foods. a research is being conducted to evaluate countries and the possibilities for Dumbara to
expand their marketing and manufacturing overseas, so this report will be presented to the
managing director of the Dumbara Natural Foods to support by giving ideas and information
regarding selling their new product ‘ kithul jaggery pudding ‘ in the international markets. So,
firstly some benefits and Limitations have been given so that the managing director can easily
identify their gains and losses when trying to expand internationally. afterwards by considering
two countries a research is been done to find out the most appropriate country to carry out the
organisation’s two internationalization objectives. Then moving forward the mode of entry to
the evaluated country is been clearly justified.
Further, an international strategy in been recommended if Dumbara natural foods is shifting
their manufacturing and marketing overseas. And this recommendation has been given in
accordance with the marketing mix.
And finally, a description of international accounting as well as human resource management
issue’s that will arise in the new country in been specified.
At the end the report is concluded with an overall evaluation.
All information , facts and figures are taken from valid sources and referenced.

5|Page
KD/HNDBSM/56/17
 Introduction

Figure 1 Company logo

Dumbara Natural Foods was established in 2007 and manufacturers high quality, unique
organic natural sweetener “Kithul” and Jack fruit based vegan products according to EU
organic and FSSC stands . Kithul is a palm endemic to Sri Lanka’s rainforests.

Dumbara first started their manufacturing of high quality kithul pani in kengalle Sri Lanka
about 5 years ago. So, with the time as the demand for their high-quality natural foods
increased, they widen their product portfolio by adding various natural food products. So, at
this time Mr. Kumara the managing director of Dumbara natural foods planned to sell one of
their best locally selling product “kithul jaggery pudding” to the international market. And also,
he planned to get the help of the industrial development board, Sri Lanka, to make this
expansion a success.

Figure 2 Dumbara kithul jaggery product

6|Page
KD/HNDBSM/56/17
1.0) Advantages and disadvantages of doing international trade to Dumbara
Natural Foods.

International trade is defined as all commercial transactions between two parties that takes
place in two or more countries. Therefore, international trade will help a country to obtain
goods and services which are not available in that country. examples can be Sri Lanka can
import oil, gas, gold or copper while exporting tea or rubber.

So, Dumbara natural foods as an organic food manufacturer trying to expand their products to
the international market will bring them number of benefits. So, in the recent world organic
food is increasingly becoming an active topic in international trade due to the increase in
peoples living standards worldwide, improved transportation , and urbanisation. in developed
countries we see that people consume more organic food now as a result of higher income.
So, if Dumbara sells their kithul jaggery pudding product in other countries they can gain huge
profits by selling their high-quality product because even if they sell it at a higher price, high
income earners in those countries will purchase this product because of its unique organic
quality.
Another benefit for Dumbara when expanding internationally will be they can increase their
sales over time. Because when Dumbara sells a product that is not available in that particular
country, people will be persuaded to buy and see what this product is. So, there are examples
in the real world, where local food companies such as Maliban biscuit manufacturers have
exported their products overseas and have gain large profits and awareness among people in
35 countries. And also, Maliban has gained an award for the best exporter of the year. This is
proved according to Maliban exports information.
Therefore, with the help of that example if Dumbara Natural foods export their newest kithul
jaggery pudding to overseas markets, with the time they can increase their sales and profit
targets and also in future if the demand for their products increase they can even expand
international trading by exporting and selling more Dumbara products in other countries.
Moreover, if Dumbara Natural foods sell their kithul jaggery pudding in international markets
as well, they can easily maintain and continue their product life cycle. So, product life cycle
is a diagram which shows the different stages a product will go through when it is launched
into the market.

7|Page
KD/HNDBSM/56/17
 Figure 3 Product life cycle

Therefore, as you can see, when considering the above image, the kithul jaggery pudding
product manufactured by Dumbara natural foods is still in the growth stage of the local market
because the product is new. So, in order to reach the maturity stage and increase their sales they
can expand this to the international markets, and also if the demand for their jaggery pudding
increases in order to continue this life cycle they can give a product extension by adding more
value and features to the product. So due to this they can gain sales and profits for a longer
period of time to this product.

However, there can also be some disadvantages if Dumbara natural foods sell their new kithul
jaggery pudding to the international markets. This is because doing international trade will be
costly for Dumbara. There will be extra costs that is incurred such as tariffs, embargos also
implementation cost will be high if Dumbara produce and market their products in an overseas
market.
And also control over the local company will sometimes go down because when Dumbara
natural foods sells their product to other countries they will start depending on that sale and
automatically the local company’s development will fall. And they will lose the local sales
which will lead to a loss of profit. So, in order to overcome this, they have to have strong
management teams in the mother country as well as in other countries.
Moreover, sometimes when doing international trading Dumbara natural foods will have to
bear loss because time to time there will be currency appreciations and deprecations in
countries which will directly affect their incomes.

8|Page
KD/HNDBSM/56/17
2.0) Country evaluations and there impact to the two internationalisation
objectives of Dumbara Natural foods

Objectives of internationalisation makes a company’s products become recognizable in others

market, not just in the local market. So, Dumbara natural foods also have developed two
objectives as one country for marketing their products and another country for production and
marketing both.

Figure 4 Country selection

2.1) Marketing the product in Austria

Austria is a landlocked country situated in Europe, which has a population of nearly 9 million people.
The Austrian economy is highly internationalized. And total Austrian imports have reached $184 billion
in 2019 according to the statistical facts given. So , this is one of the main reasons to market the
Dumbara kithul jaggery pudding in the country Austria. As they are depending more on imports, they
have less trade barriers which means the exporting costs for Dumbara natural foods will be
lower.

In addition to that Austria is being recognized as the 4th most sweet food consuming country
in the world. According to statistical figures around 24.7 pounds of sweet food are consumed by
Austrians. ( Xuanyan Iris Ouyang, Staff Writer Oct. 31, 2016, )Therefore as the kithul jaggery
pudding manufactured by Dumbara is basically a sugary product which means it is more into the sweet

9|Page
KD/HNDBSM/56/17
foods, if this product is marketed in Austria there is a possibility of majority of the countries people
liking this product because it is also a high quality sugary product.
Moreover, Austria is also a country which has a demand for organic food. There is also evidence that
Austria also benefit from organic food campaigns as people nowadays strive to know what they
consume in their daily life therefore Austria is highly demanding on importing organic food. So, as the
Dumbara company is a company manufacturing food products using 100% high quality natural
ingredients If they export and market this product in Austria, we can assume that Austrian people will
purchase this product due to its organic kithul ingredient and in the meantime Dumbara can expect to
reach higher sales.

Civil strife, war and terrorism in Austrian economy

Austria was involved in world war which continued for thirty years, and billions of people were
killed at that time. Afterwards their economy, resources, trading everything went down and it
took so many years for them to develop their country and to make their country stable in line
with other countries. They have started importing goods from year 1953. And this have
continued until today. After the tragic war that took place all resources in the country were
damaged therefore Austria depended on imports for a longer time, mainly their imports were
machinery, equipment, oil products and food products. So, after that great war, until today there
has been no such wars taken place and with recent records it shows the country is doing
international trade among 150 worldwide countries. So, we can assume that if Dumbara natural
foods engage in international trading with Austria there is a very low risk of war occurrence
which will affect their trading.
But however, even though there is less or no risk of civil war, terrorism in the sense crimes
such as robbery and vandalism takes place across the country. But the Austrian government
has taken necessary legal actions in order to reduce them and also, they have imposed strict
rules and have guaranteed their security towards their international trading which means that
countries which are involved in international trading with Austria is highly protected.

10 | P a g e
KD/HNDBSM/56/17
Trade Analysis of Austria

Austria is a rich market with 27th largest GDP end 14th highest per capita GDP in the world .
Its economy is diversified and highly international. Austria's economy is dependent on foreign
trade and closely linked to the economies of other EU countries, particularly Germany. Austria
trades with some 150 countries, with the European Union accounting for about two-thirds of
the total.
Currency used by Austria is Euro. Which today amounts to 209 Sri Lankan rupees. So Dumbara
natural foods have a great opportunity of getting more profits with this currency changes which
happens day to day.
In addition, according to given information Austria mostly imports food items such as organic
foods, meat and sea food. So, if Dumbara export their sweet food such as the kithul jaggery
pudding it possible that they can catch up a niche market in Austria’s international trading. and
because as the majority of Austrian people are craving sweet food it is easy to attract customers
and make their product aware in the Austrian market.
For instance – Austria is importing food items such as cakes, biscuits and confectionaries from
countries like Australia, Switzerland and brazil, therefore if Dumbara sells their natural sweet
food to this country it is a competitive advantage because no other country is exporting a food
item like kithul jaggery pudding to Austria so trading will be easy and Dumbara can easily
capture this niche market.

Culture, political and social environment in Austria

culture can be defined as the specific learned norm sofa society that reflect attitudes, values
and beliefs. so, it is important to consider about cultural dynamics when doing international
trading. culture consists of societies where homogeneous groups of people who share their
attitudes values and customs . Culture can also result on the change of taste and preference of
the people.
Austrian culture is greatly influenced by the centuries-long Catholic tradition. Daily life and
legislation are however strictly secular. Social cohesion and tolerance are of the highest
significance in Austrian society. In Austria, people share a friendly culture.

11 | P a g e
KD/HNDBSM/56/17
Austria’s government has a president and a parliament. Earlier, the parliament has not allowed
more imports to the country, but it was changed with the new parliament. Now Austria is highly
depending on imports.
So, as Austrian people’s taste and preference is more into sweet food Austrian government is
concerned in importing more sugary food to their country. It is evidenced that more than 165
million is spent on sweet foods per year in Austria.

Opportunity, Risk Analysis

When do an international trade there are always opportunities and risks that are involved.
Opportunities for Dumbara Natural foods when exporting their kithul jaggery pudding to
Austria can be the niche market for this product. Even though Austria has a high demand and
sales for natural foods, this type of a sweet food product is not available in Austria still. So, if
Dumbara markets this product in Austria there is a great opportunity in capturing the market.
Another thing can be as this product will be unique in the Austrian market Dumbara can charge
a premium price due to its natural high-quality ingredients so with the time Dumbara can earn
high profits.
However, the risks can be, with the time competitors might enter to the market and there is a
risk of sales going down. And also, if our currency value depreciates Dumbara will have to
bear losses. Moreover, if the government changes there is a risk of imposing more trade barriers
on international trading and also restricting the number of imports that can be imported to the
country, so if this happens it will affect Dumbara.

Figure 5 Opportunity Risk Matrix

12 | P a g e
KD/HNDBSM/56/17
2.2)Producing and Marketing the product in India

India is a country in South Asia, and it is the second most populous country and the most
populous democracy in the world. India used to be a protectionist state for a long time, but the
country has become progressively more open to international trade. Currently, trade represents
43.3% of the country's GDP. India is also importing goods and services but not as much as
Austria. This because India has given priority to their own goods and services which are
produced in their country itself. So, India is trying their best to develop their trade within the
country. India is also a country which consumes high sugary food. As we all know India has
number of festivals each year therefore, they make various types of sweet foods in these
seasons. And also, people consume so much of sweet foods at this time.

So, there are many reasons for choosing the country India for the kithul jaggery pudding
production and marketing both. As there are only very few countries which produce kithul
jaggery India is one country for producing it like Sri Lanka. And also, as India is very close to
Sri Lanka it is easy to involve in international trading with India.

So Indian farmers are producing this kithul jaggery in large quantities every year. And mostly
they export it to other countries. However, even though India produces kithul jaggery they are
not manufacturing any kind of food products with them so this will be an added advantage if
Dumbara natural foods started producing their kithul jaggery pudding in India and marketing
there as well. So, as the main ingredient is available in India which is kithul jaggery it will be
easy for Dumbara to go there and start manufacturing.

Moreover, Dumbara can also take their employees from here such as product manufactures, so
that there will be no change in the original product. So, there is a higher possibility of Indians
liking this kithul jaggery pudding product because it contains more sweetness and we can also
assume that Indians will purchase this in festive seasons because it represents one of their main
ingredient which is the jaggery. So consequently, Dumbara natural foods can aim for higher
sales and profits.

Unlike for marketing only. If establishing a branch in India and manufacturing the product
there it will cost less because there will be no tariff costs and also as India’s currency rate is
lower Dumbara ca n enjoy extra incomes.

13 | P a g e
KD/HNDBSM/56/17
Opportunities and risks can be layed out when trading with India. There are number of
opportunities. If Dumbara natural foods produce and sell their kithul jaggery pudding in India,
they can increase their sales as well as this product will be recognized in a large country like
India. Which will increase our countries reputation as well. Because this product will be
manufactured from their own kithul jaggery they will demand for this product.

Moreover, as Indians are highly attracted to their culture and beliefs sometimes, they might not
consume products which are manufactured from an overseas country. But this can be exploited
if Dumbara manufactures their kithul jaggery pudding by using India’s high quality jaggery.

3.0) Modes of Entry to the evaluated countries

Foreign market entry modes differ in the degree of risk they present, the control and
commitment of resources they require, and the return on investment they promise.

Types of modes of entry

 Merchandise exports and imports

 use of assets licencing agreements
 foreign investment
 acquisition
 partnering and strategic alliance

Exporting

exporting is a typically the easiest way to enter an international market and therefore most firms
begin their international expansion using this mode of entry. exporting is the sale of products
and services in foreign countries that are sourced from the home country. so the advantage of
this mode for Dumbara can be, they can avoid the expense of establishing operations in the
new country, which they typically do through contractual agreements with a local company or
distributed. In addition, when exporting the Dumbara must give thought to labelling, packaging
and pricing the offering appropriately for the market . In terms of marketing and promotion the
firm will need to let potential buyers . Exporting is the best mode of entry for Dumbara when
marketing their products in Austria. If Dumbara enter to the Austrian market as exporters They

14 | P a g e
KD/HNDBSM/56/17
can get fast entry at a lower risk. Moreover, Dumbara can select their foreign representatives
in the overseas market and also direct exporting will help them better to protect their patents,
goodwill , trademarks and other intangible assets, also Dumbara natural foods can utilize the
direct exporting strategy to test their products in international markets before making a bigger
investment in the overseas market.

however, the disadvantage can be there will be lower control low local knowledge and potential
negative environmental impact of transportation. But Dumbara company can overcome this if
they send a proper management and marketing team to Austria to market this product.

Licencing agreement and franchising

Companies which want to establish a retail presence in an overseas market with minimum risk,
the licencing and franchising strategy allows another person of business assume the risk on
behalf of the company. therefore, in licencing agreement and franchise , an overseas based
business will pay a business royalty or Commission to use their brand name, manufacturing
process, products , trademarks and intellectual properties.
So, if Dumbara natural foods is planning to produce and sell their kithul jaggery pudding in
India, licensing and franchising agreement is the most appropriate mode of entry. This is
because as this product is a niche in the Indian market, they can franchise Dumbara company
and fill that product gap in that country. So, this license will easily allow Dumbara to establish
their branch in India, get raw materials and to produce the product.
If Dumbara have natural foods enter to India with licencing and franchising agreement they
will benefit because this will be a low cost of entry into an international market. moreover,
licencing and franchising will provide partners which has knowledge about the local market
and in addition India will offer a passive source of income and also, they will allow expansion
in multiple regions with minimum investments. Further, this will reduce political risk as in
most cases the licencing or franchising partner is a local business entity
However, the disadvantage can be in some cases the business might not be able to exercise
complete control on its licencing and franchising partners in the overseas market and it will
lead to risk of tarnishing its brand image and reputation in the overseas market due to the
incompetence of their licencing and franchising partners.

15 | P a g e
KD/HNDBSM/56/17
4.0)An international strategy for producing and marketing overseas along with
the marketing mix for the New markets

International business strategy refers to plans that guide commercial transactions taking place
between entities in different countries. So before selecting an appropriate strategy we should
identify when this product is going to be standardized in India or Adapted. When doing in
international marketing the marketeers are required have to come up with a decision as to
whether they are going to standardise the product or to modify the existing product and sell it
there. this decision can make impacts on the organisation in terms of research and development
expenses, finance, production and marketing mix.

Standardization

Products standardisation refers to the process of maintaining uniformity of products and

services sold in different markets . For an example, if a particular company comes up with the
decision of standardising the product then the product is being Manufactured using the same
materials, same processors and even sold under the same name. So, standardization is the best
option for Dumbara natural foods when producing and marketing their product in India.
Because as this is the first time ever Dumbara is going to make their product available in
another country, it is better to produce and sell their original product without changing it and
without taking any sort of risks.
Benefits Dumbara will get if they standardize their product in India will be, list cost in
standardisation and identical product is produced using the same material same processors so
if Dumbara purchasers Kithul jaggery in large quantities from Indian farmers they will get
discounts and at the same time standardising the product will cause less wastages in material
usage leading to reduced extra costs . Moreover, as Dumbara has experience in producing the
kithul jaggery product in Sri Lanka they can easily increase production in India if the product
is standardized with their natural and original ingredients. But this will not be achieved if the
product is adapted because it takes time to change the product and market.

16 | P a g e
KD/HNDBSM/56/17
Adaption
Product adaption refers to the process of modifying the existing products in order to reach to
each market. there are several adaption strategies that entity can use such as
 product target market
 product package and design
 ingredients
 language and culture
Organisations need to come up with different ways so that they can cater different markets in
a way where the customer needs and requirements are addressed.
So, as the kithul jaggery pudding manufactured by the Dumbara natural foods is basically a
product that included natural ingredients, if it is adapted the original taste and quality will be
harmed. So, it is better for Dumbara to standardize their product in India than adapting.

3.1) International Strategies

Due to increasing globalisation the past decades, even smaller companies have been able to
cross national borders and do business abroad. Consequently, many terms have been given to
companies operating in multiple countries: multinationals, global businesses, transnational
companies, international firms. There are four main international strategies –

 Multidomestic strategy

 global strategy

 international strategy

 transnational strategy

17 | P a g e
KD/HNDBSM/56/17
Multidomestic strategy

companies with a multidomestic strategy have as aim to meet the needs and requirements of
the local markets worldwide by customising men tailoring their products and services
extensively. In addition, they have little pressure for global integration. Consequently,
multidomestic firms often have a very decentralized and loosely coupled structure where
subsidiaries worldwide are operating relatively autonomously and independent from the
headquarter. Multidomestic strategy adapts its products to local tastes by offering different
products in different markets. A popular example for multidomestic company is Nestlé. Nestlé
uses a unique marketing and sales approach for each of the markets in which it operates.

Global strategy

global companies are the opposite of multi domestic companies . They offer a standardised
product worldwide and have the goal to maximise efficiencies in order to reduce costs as much
Their main role is to implement the parent company’s decisions and to act as pipelines of
products and strategies as possible. Global companies are highly centralized, and subsidiaries
are often very dependent.

International Strategy

An international strategy using company has little need for local adaption and global integration
therefore it is placed in the low integration and lower responsiveness at the matrix. the majority
of the value chain activities will be maintained at the headquarter . This strategy is also referred
to as an exporting strategy. products are produced in the company’s home country and sent to
customers all over the world. If any are functioning in this case more like local channels
through which their products are being sold to the end consumer large wine producers from
countries such as France and Italy are great examples of international companies

Transnational strategy

This transnational company has characteristics of both the global and multi domestic firm . Its
aim is to maximise local responsiveness but also to gain benefits from global integration.
transitional companies often try to create economies of scale move upstream in the value chain
and be more flexible and locally adaptive in downstream activities such as marketing and sales.
In terms of organisational design, a transitional company is characterised by integrated and
interdependent network of subsidiaries all over the world.

18 | P a g e
KD/HNDBSM/56/17
 Figure 6 international strategies

Transnational strategy for Dumbara natural foods

This strategy is the most suitable for Dumbara natural foods because here business can focus
both on increasing local responsiveness ,as well as increase global integration. The biggest
advantage of transnational strategy Is that it helps the company in expanding its business
because once company adopts this strategy then the whole world is the market for companies’
products and wider the market higher are the chances of company generating high sales
volumes resulting in higher profits for the business. And another advantage for Dumbara will
be since the company has decentralized the business it can employ as well as using cheap
labour and raw material from the country in which it is operating and hence company will be
able to save a lot of money on the production side of the business. Moreover, transnational
strategy can implement good things such as quality ingredients from India and culture of India
into its own country business and can reap benefits of good things or quality of that country.

19 | P a g e
KD/HNDBSM/56/17
 3.2) Marketing mix

According to Philip Kotler Marketing mix is the mixture of controllable marketing variables
that the firm users to pursue the sought level of sales in the target market. the marketing mix
indicates the appropriate combination of four Ps. These are

 Product
 Price
 Place
 Promotion

Product

A product is anything that is capable of satisfying customer needs. a product would contain
features as well as it should give functional benefits. So, the jaggery pudding manufactured by
Dumbara natural foods is basically a product based on kithul jaggery.

Product quality - Quality is an important factor to consider when developing a product. The
kithul jaggery pudding is made of 100 % natural kithul taken from Srilankan rain forests. So,
this has a very high quality.

Product features/ ingredients – Main ingredients used in the product is kithul jaggery, vanilla,
cinnamon sugar, gelatine, water, salt and a small amount of permitted colouring.

So, as these ingredients are organic people in countries like Austria and India will get attracted
to the unique taste that this product is having.

Product brand name – Brand name is a term or logo designed to identify its product from the
rival products. So, this kithul jaggery pudding is produced by the Dumbara natural foods
company in Sri Lanka.

Product Objective - The objective is to create better awareness on this hidden valuable
ingredient Kithul is consider as "Liquid Gold" because of its unique taste and low glycaemic
index value.

Product Package – Packaging of a product is also important to attract customers. This product
is covered with paper wrapper which has its name, ingredients and product look printed in the
front of the package.

20 | P a g e
KD/HNDBSM/56/17
Price

Price is the amount of money charged for a product or service. Price has been the major factor
affecting buyer choice. The price a company will set to their product should be affordable to
the target customers. so, there are number of pricing methods used by businesses to price their
products. There are factors to consider when pricing a product that is exported overseas.

 cost of transport
 tariffs or import duties
 exchange rate fluctuations
 personal disposal incomes of the target market

Figure 7 pricing strategy matrix

Penetration Pricing strategy

This involves setting a low price when launching a new product in order to get established in
the market. So , as the kithul jaggery pudding is new product that is going to sell in the Indian
market Dumbara will firstly have to charge a low price for their high-quality product. And also,
as there are more lower income earners in India, charging a lower price for a new product can
attract those customers. Moreover using this pricing strategy there is less risk of competitors
entering to the market. However, with the time when sales grow Dumbara must increase the
price on their kithul jaggery pudding because they have to cover all the incurred costs.

21 | P a g e
KD/HNDBSM/56/17
Place

The Place element of the marketing mix is about distributing a product or service to the
customer, at the right place and at the right time.
In an overseas market there will be more parties involved because the goods need to be moved
around a foreign market where business practices will be different to national markets.
If Dumbara natural foods is expanding to India to produce and sell their standardized product
they can produce them in a factory and afterwards they can distribute them to large scale and
Dumbara natural foods will need to investigate distribution chains for each country they would
like to operate in. example – Austria and India, They will also need to investigate who they
would like to sell their products and services to businesses, retailers, wholesaler or directly to
consumers. Medium scale supermarkets as well as they can sell them to superstores.

Promotion

Promotion is the activities that communicate the value of the product and persuade customers
to buy it. As with international product decisions an organisation can either adapt or standardise
their promotional strategy and message. Advertising messages in countries may have to be
adapted because of language, political climate, cultural attitudes and religious practices.

Television advertisements – Dumbara will have to place advertisements in popular Indian TV

channels in order to make the new product aware for customers

Leaflets, and flyers – Dumbara have to hire people to distribute leaflets and flyers which have
persuasive and informative information about the new imported product that is available in the
Indian market.

Even though promotion methods are costly Dumbara will have to implement various
promotional strategies in order to capture the Indian customers.

22 | P a g e
KD/HNDBSM/56/17
Conclusion

Dumbara as a natural foods producing company in Sri Lanka is doing a good job in the local market.
And is now trying to expand to the international market by marketing and producing and marketing
their kithul jaggery pudding.

Dumbara aims at supporting the rural farmers in Sri Lanka, uplift the farming community's living
standards and offering their children a better education. The company assists in maintaining organic
plantations, providing relevant knowledge and guarantees to take in their Kithul sap and natural
ingredients. Therefore, the company ensures a steady income for the farmers.

There are several advantages and disadvantages that Dumbara will have to face when doing
international trading. But most of these can be controlled if choosing the most appropriate country that
fits their company. And it is a must to choose the best mode of entry so that Dumbara can easily enter
to an international market. However, the international strategies implemented, and product
standardization and adaption will affect the marketing mix of the kithul jaggery product of Dumbara.
And in future if they are doing good in international trading Dumbara can even export their other
products in their product portfolio to India, Austria and other countries.

Overall, Dumbara natural foods is doing a good job so if they carefully start with international trading,
they can earn high sales and profits from the local market and from the international market as well.

23 | P a g e
KD/HNDBSM/56/17
References

Austria International trade, Information about International trade in Austria. 2020. Austria International
trade, Information about International trade in Austria. [ONLINE] Available at:
https://www.nationsencyclopedia.com/economies/Europe/Austria-INTERNATIONAL-
TRADE.html#:~:text=Austria%20%20International%20trade,twothirds%20of%20the%20tota.
[Accessed 02 June 2020].

Austria - Market Overview | export.gov. 2020. Austria - Market Overview | export.gov. [ONLINE]
Available at:
https://www.export.gov/article?series=a0pt0000000PAtDAAW&type=Country_Commercial__kav.
[Accessed 02 June 2020].

Super Heuristics. 2020. Modes of Entry into International Business [Advantages & Disadvantages] -
Super Heuristics. [ONLINE] Available at: https://www.superheuristics.com/5-modes-of-entry-into-
international-markets/. [Accessed 05 June 2020].

India International trade, Information about International trade in India. 2020. India International trade,
Information about International trade in India. [ONLINE] Available at:
https://www.nationsencyclopedia.com/economies/Asia-and-the-Pacific/India-INTERNATIONAL-
TRADE.html. [Accessed 12 June 2020].

International Marketing Mix. 2020. International Marketing Mix. [ONLINE] Available

at: https://www.learnmarketing.net/internationalmarketingmix.htm. [Accessed 18 June 2020].

Pressbooks. 2020. Types of International Strategies – Mastering Strategic Management – 1st Canadian
Edition. [ONLINE] Available at: https://opentextbc.ca/strategicmanagement/chapter/types-of-
international-strategies/. [Accessed 22 June 2020].

24 | P a g e
KD/HNDBSM/56/17