-MARK7018

Assignment 2
Student number: 19044097

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Executive summary

Nooz Optics: an omnichannel (Chaffey and Ellis-Chadwick, 2019, p. 10), limited

liability company based in Belgium, revenues ~18.4million USD, 20 employees
(RocketReach, 2020?). Nooz trademark is owned by Binoptics SPRL (Justia, 2020).
The trademark (Justia, 2020) and the holding company Binoptics were established in
2016 (Societe, 2020).

Currently, the brand trades in 36 countries (Nooz Optics, 2020a) selling ready to
wear, reading glasses for people suffering from age related loss of near vision
(presbyopia) (Renna et al., 2016). Nooz’s target market is defined around world
demographics i.e. presbyopia sufferers globally (Hollensen, 2017, pp. 24-27).
Current product range includes ‘Original’ Nooz glasses (armless, minimalist,
frameless), ‘Nooz-Essential’ glasses (with frames and arms) and a range of
accessories (Nooz Optics, 2020b).

South Africa and Brazil are examined as potential markets for further expansion. The
proposed expansion will initially only include Nooz-Original and accessories. Based
on the external environment analysis, Brazil is selected as the country of choice.
Main reasons: Brazil’s economy is more resilient of the two, the population is older
and thus more relevant to Nooz. The positioning of Nooz will centre around ‘Price &
Quality’ and ‘Price & Compactness’, competing with brands offering ready to wear,
compact (armless) spectacles for presbyopia.

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Table of Contents

Executive summary .......................................................................................................2

1. Product overview ....................................................................................................4

2. Rationale for expansion .........................................................................................5

3. Company competencies.........................................................................................6

4. PESTLE Analysis: South Africa vs. Brazil .............................................................6

4.1. Justification of market selection ......................................................................9

5. Competitor analysis and positioning strategy ......................................................10

6. Mode of entry into the chosen market .................................................................14

References...................................................................................................................15

Appendix 1 ...................................................................................................................17

Appendix 2 ...................................................................................................................18

Appendix 3 ...................................................................................................................19

Appendix 4 ...................................................................................................................20

Appendix 5: pages 21-22.............................................................................................21

Appendix 6: pages 23-27.............................................................................................23

Appendix 7 ...................................................................................................................28

Appendix 8 ...................................................................................................................29

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1. Product overview

Nooz is a range of ready to wear, branded, reading glasses, (Nooz Optics, 2020a).
The reading glasses correct presbyopia, progressive, age-related accommodative
loss of near vision (Renna et al., 2016). Presbyopia affects over 1 billion people
worldwide (Wolffsohn and Davies, 2019) and it starts around 40 years of age (Renna
et al., 2016).

Nooz product range is narrow (Figure 1 and Appendix 2). The ‘Original’ Nooz
glasses are armless, minimalist, frameless. Nooz has recently introduced ‘Nooz-
Essential’ glasses (with frames and arms), 115.68% more expensive than the ‘Nooz-
Original’ (Appendix 2). Narrow range of accessories complement the glasses.

Figure 1: Nooz product range adapted from Nooz website (Nooz Optics, 2020b)

All products have 2-year guarantee and online eye test is available (Nooz Optics,
2020b) (Appendix 3).

Needs (as per Nooz website (Nooz Optics, 2020b)):

• Correct condition arising from presbyopia.
• Provide an alternative to traditional glasses, which are more bulky, heavier,
and fragile.

Wants (as per Nooz website (Nooz Optics, 2020b)):

• Light, ultra-slim, compact and practical glasses.
• Durability and convenience.

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 • High quality.
• Fashionable, modern, elegant and minimalist.
• Simplified wearing and use of glasses.
• Modern option (glasses don’t invoke the image of aged/old person) for middle
age people.

2. Rationale for expansion

Nooz has global appeal and potential to serve a worldwide market (Solberg, 1997,
pp. 25-26). Nooz fits into the 8th window of ‘Solberg’s nine strategic windows model’
(Solberg, 1997) (figure 2). It’s a precocious adolescent in the global market.
Manufacturing, product design and ophthalmological expertise are outsourced
(Appendix 4). Operations are omnichannel and sales are Internet driven in 36
countries (Appendix 1). It’s therefore assumed Nooz has the skills to enter into and
manage ‘complex negotiations’ (Solberg, 1997, pp. 22-23). The rational for
expansion is to enter South America via Brazil or Africa via South Africa and grow
the business in one of those emerging markets. The expansion will initially only
include Nooz-Original and its accessories. Nooz’s target market is not referenced to
Hofstede’s cultural model (Hollensen, 2017, pp. 265-266) because it’s defined
around world demographics (i.e. presbyopia sufferers globally) (Hollensen, 2017, pp.
24-27).

Figure 2: The nine strategic windows (adapted) illustrates Nooz position. Source:
Solberg, 1997 cited in Hollensen (2017, p. 20)

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3. Company competencies

• Ability to manage upstream outsourced value chain (Appendix 4) and

downstream value chain (distribution) though complex negotiations
(Hollensen, 2017, p. 28).
• Digital competency and omnichannel (Chaffey and Ellis-Chadwick, 2019)
approach to markets.
• Management team’s skills in developing and managing strategic alliances
increase its competitiveness (Solberg, 1997)

The following weaknesses (SWOT (Dibb et al., 2016, pp. 49-52)) (Appendix 5))
should be considered when conducting PESTLE:
• No working exposure to emerging economies
• Limited resources (20 employees (RocketReach, 2020?)) to compete against
LSEs (Large Scale Enterprises) (Hollensen, 2017, p. 12)

4. PESTLE Analysis: South Africa vs. Brazil

PESTLE (Dibb et al., 2016, pp. 101-103) (Appendix 6)

South Africa
Political
Democratically elected and stable
government (Passport, 2020b).
“Income distribution is one of the
world’s most unequal” (Passport,
2020b), could lead to civil unrest.
Economic
“South Africa’s economy has been
performing too poorly…”(Passport,
2020b) i.e. may not be the right
choice for Nooz.
The economy “globally positioned,
sophisticated and diversified”
(Passport, 2020b) i.e. may be viable
to enter at a later date creating a
path into Africa.
Brazil
Recent deployment of army to
maintain law and order (Passport,
2020a) signals volatile environment
Economy becoming more diversified
(Passport, 2020a), which will render
it increasingly more resilient and
stable i.e. good for (Nooz) business.
Brazil continues to attract foreign
direct investment (Passport, 2020a),
which suggests the economy will
continue to grow in the long term.

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High government spending on debt
(60.2% of GDP) and credit agency
downgrade to junk status (Passport,
2020b); decreased currency value
increases cost imports.
Government helping to create the
African Union and NEPAD (New
Partnership for Africa’s
Development) (Passport, 2020b).
Trade co-operation with other
African countries from South Africa
may increase, creating a route into
Africa.
“Real GDP will grow by 1.3% in
2020” (Passport, 2020b). Private
consumption and disposable
income per household expected to
increase (Passport, 2020b)
however, population expanding
faster than the economy will lead to
a fall in the per capita income
(Passport, 2020b). South Africa
becomes more impoverished,
reducing the amount of value for
Nooz.
Modest growth (1.8% in 2021, 2.5%
per year till 2027 (Passport, 2020b))
projected, private consumption
expected to improve i.e. beyond
2021 South Africa economy may
improve.
Value added tax increased (from
14%-15%) to cover state
expenditure (Passport, 2020b) may
signal further tax increases e.g.
company tax.
Public spending 90.7% of GDP;
credit agency downgrade to junk
status (Passport, 2020a); currency
devaluation increases the cost of
imports.
The EU is currently negotiating a
free-trade deal with Brazil, as part
of Mercosur (MERCOSUR, 2020)
negotiations (Passport, 2020a).
Once concluded, lower trade
barriers and tariffs are expected for
the region.
The economy is improving, real
GDP is rising (2.1%) (Passport,
2020a). Investment sentiment on
the up, raising confidence in the
economy (Passport, 2020a) likely
positively impact on future
consumer spending. Interest rates
stable and low, conducive to
business growth.
Real GDP expected to increase to
2.4% between 2023-2037
(Passport, 2020a). Private
consumption expected to rise,
making Brazil an attractive country
to enter.
Financial transactions will attract
tax, it’s expected to raise USD$8
billion (Passport, 2020a) – Nooz
could incur taxation on the
repatriation of funds. High taxation
impacts discretionary spending,
driving people into the informal
economy for cheaper solutions
(Passport, 2020a).
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Low per capita expenditure Economically divided (Passport,
(Passport, 2020b) and large low- 2020a) – poor northern region (half
income population (Passport, the household expenditure of the
2020b) suggests South African southern regions). The south-east
demand for Nooz product may be and south are the most affluent
small. areas; may be worthwhile entering
Growth beyond 2020 to 2030 only these areas. 80% of rural areas
expected to rise annually by 2.4% are amongst the poorest (Passport,
only (Passport, 2020b). Highly 2020a). Targeting major cities only
unequal income distribution would be more effective and not
(Passport, 2020b) suggests small stretch Nooz’s current resources.
market for Nooz.
Social
Growing population, median age Growing population (Passport,
expected to rise to 29.6 years by 2020a), aging population to
2030 (Passport, 2020b) – increase, expanding the need for
population is young. Consumption spectacles/reading glasses – it’s a
of ready to wear reading glasses is growth market for Nooz.
age related, market will take time to “The ageing population positively
grow. impacts the consumption of
Income distribution highly skewed spectacles” (Passport, 2019a)
(10% of the households receiving
close to half of the disposable
income) (Passport, 2020b). This
suggests the market for Nooz will be
small.
Technological (same for both countries)
New treatments are being researched for presbyopia that may eliminate the
need for ready to wear reading glasses. Advances in medical research could
disrupt the market (Renna et al., 2016).
Environmental (same for both countries)
There would be no direct impact arising from the environment/sustainability,
although it is recommended plastic recycling should be considered as Nooz
product are plastics (Nooz Optics, 2020?-c).

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 Legal
The “…regulatory environment not Brazil Judiciary is dysfunctional
conducive to private investment…” (Passport, 2020a), it may be difficult
(Passport, 2020b). Stringent labour to seek legal remedy. For Nooz this
laws and unproductive workforce means stringent screening of
presents a challenge for a start-up potential distributors / business
business. Using local, established partners.
agent or distributor, who knows this
environment, would reduce the risk.
The Supreme court of Appeal ruling
that the ex-president should face
charges of corruption, money
laundering etc. (Passport, 2020b)
signals a strong, independent
judiciary lowering the risk of having
unenforceable contracts.
Ethics
Corruption (Passport, 2020b) is an Corruption is an issue (Passport,
issue and Nooz must make it clear 2020a) and Nooz must make it clear
to potential distributors/partners that to potential distributors/partners that
it works within the laws of the land it works within the laws of the land
in which it conducts its business. in which it conducts its business

4.1. Justification of market selection

Based on the above PESTLE, the decision is to expand into Brazil. Key reasons
below:
- Brazil’s economy shows potential to be stronger and more resilient compared
to South Africa’s economy.
- Population in Brazil is older than in South Africa, therefore Brazil is larger and
more relevant for Nooz.
- Potential for lower trade barriers/tariffs in future resulting from the
MERCOSUR negotiations

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Additionally:
- Sales of readymade reading glasses are projected to increase in Brazil
(Passport, 2019a) whilst in South Africa the projection is downwards
(Appendix 7).
- Readymade, reading glasses post the fastest growth of 2% in current value
terms in 2019 in Brazil (Passport, 2019a)

5. Competitor analysis and positioning strategy

Spectacles market in Brazil consists of three main categories (Figure 3 below

(Passport, 2019a)). Readymade, reading glasses constitute only 0.68% (137.8m
BRL – Brazilian Real) of the total retail value (20,154.5m BRL) for spectacles in
2019. The positioning focuses only on brands offering ready to wear, compact
(armless) spectacles for presbyopia.

Figure 3: Sales of Spectacles by Category (Brazil) (Passport, 2019a)

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The analysis identified the following brands as the competition-set for Nooz in Brazil:

Figure 4: Nooz competition-set in Brazil. Data compiled from: (Nooz Optics, 2020?-
b), (Clic Magnetic Glasses, 2020?-a), (Banggood, 2020?-a), (Banggood, 2020?-b)

The positioning of Nooz in Brazil will centre around ‘Price & Quality’ and ‘Price &
Compactness’. In the perceptual ‘Price & Quality’ map below (figure 5), Nooz is
perceived as priced below Clic and above brand examples representing ‘Others’ in
the gathered data (Passport, 2019a). It suggests clear positioning of Nooz and Clic
as high-quality brands.

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Figure 5: Price & Quality perceptual map

In the perceptual ‘Price & Compactness’ map below (figure 6), Nooz is perceived as
priced below Clic and above brand examples representing ‘Others’ in the gathered
data (Passport, 2019a). It suggests clear positioning of Nooz and ‘Others’ brands as
compact products where price is the differentiator. Clic is positioned as less compact
and more expensive.

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Figure 6: Price & Compactness perceptual map

Both perceptual maps indicate Nooz is a high quality, compact and medium-priced
product in comparison to Click and ‘Others’.

Based on the available secondary data (Appendix 8), it appears Clic Readers (ready
to wear reading glasses) would be the closest, branded competitor in Brazil. The
data shows Clic has 0.3% of the total brand shares in Brazil. Other, similar products
are unbranded and appear ‘hidden’ in the ‘Others’ section of the data (Appendix 8).
Nooz lenses are certified as a medical device (Nooz Optics, 2020b). Clic has optical
competences and an in-house lab for its lenses (Clic Magnetic Glasses, 2020?-b)
indicating both products are high quality – point of parity. The points of difference
between the brands are:
- Price: Clic is ~50% more expensive (Figure 4 above)
- Compactness: Clic has no arms, it has a rubberised headband resulting in a
less compact design than Nooz

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6. Mode of entry into the chosen market

As identified in section 2 above, Nooz is in the 8th window of Solberg’s nine strategic
windows model (Hollensen, 2017, p. 20), which indicates the strategic direction of
seeking out global alliances (Solberg, 1997).
Based on the countries Nooz has expanded to (Appendix 1), it would appear it’s
following an incremental strategy of a waterfall approach (Hollensen, 2017, p. 301). It
expanded to advanced countries; the next step would be expansion into developing
countries e.g. Brazil and continue using distributors to build its market.
The following mode of entry is recommended:
- Entry into the major cities of the south-east area of Brazil (affluent areas as
identified in PESTLE – section 4 and Appendix 6): Sao Paulo and Rio de
Janeiro.
- Based on global consumer behaviour, pharmacies are a significant
distribution channel for readymade, reading glasses (Passport, 2020c). It’s
recommended to enter into a distribution alliance with a large pharmacy chain
with access to the market. Nooz will make better use of its current resources
(20 employees (RocketReach, 2020?).
- Opening a local/Brazil website to promote the product locally and recruit local
distributors (same model as currently used in Nooz current markets)

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References

Banggood (2020?-a) KCASA Carteira de bolso portátil com suporte de nariz Leitura
hipermetrópica presbítica Óculos - 2.0. Available at:
https://br.banggood.com/KCASA-Nose-Resting-Portable-Pocket-Wallet-Presbyopic-
Hypermetropic-Reading-Glasses-p-1147216.html?rmmds=detail-bottom-
alsobought__7&ID=511562&cur_warehouse=CN (Accessed: 2 May 2020).
Banggood (2020?-b) Lente destacável Soft Silicone Leitura de quadro Óculos Pendurado de
pescoço Design Preso de reposição de nariz - Cinza 2.0. Available at:
https://br.banggood.com/Detachable-Lens-Soft-Silicone-Frame-Reading-Glasses-
Neck-Hanging-Design-Nose-Resting-Presbyopic-p-1250435.html?rmmds=home-
recommendation&ID=236511562&cur_warehouse=CN (Accessed: 2 May 2020).
Chaffey, D. and Ellis-Chadwick, F. (2019) Digital Marketing. 7 edn. Harlow, United Kingdom:
Pearson.
Clic Magnetic Glasses (2020?-a) Clic Magnetic Glasses. Available at:
https://www.clicmagneticglasses.com/clic-compact-reading-glasses-in-black-frame-
with-black-headband/ (Accessed: 2 May 2020).
Clic Magnetic Glasses (2020?-b) Clic Magnetic Glasses. Available at:
https://www.clicmagneticglasses.com/lens-info/ (Accessed: 2 May 2020).
Craven, M., Liu, L., Mysore, M. and Willson, M. (2020) COVID-19: Implications for business.
McKinsey & Company Available at: http://www.amcham-
egypt.org/bic/pdf/corona1/McKinsey_Co%20-%20COVID-19-
Implications%20For%20Business.pdf (Accessed: 26 April 2020).
Dibb, S., Simkin, L., Pride, W. M. and Ferrell, O. C. (2016) Marketing : concepts and
strategies. Seventh edition. edn. London: Cengage Learning.
Hollensen, S. (2017) Global Marketing. Seventh edn.: Pearson Education Limited.
Ixiade (2020) Ixiade Home Page. Available at: http://www.ixiade.com/en (Accessed: 27 April
2020).
Justia (2020) Justia Trademarks[website]. Online: Justia Available at:
https://trademarks.justia.com/791/80/nooz-79180744.html (Accessed: 25 April
2020).
MERCOSUR (2020) MERCOSUR in brief. online: MERCOSUR Available at:
https://www.mercosur.int/en/about-mercosur/mercosur-in-brief/ (Accessed: 30
April 2020).
Nooz Optics (2020a) Do you deliver to my country? online Available at:
https://nooz.zendesk.com/hc/en-gb/articles/360005459057-Do-you-deliver-to-my-
country- (Accessed: 25 April 2020).
Nooz Optics (2020b) Nooz Optics Home Page. online Available at: https://nooz-
optics.com/gb/en-gb/ (Accessed: 26 April 2020).
Nooz Optics (2020?-a) Diopter Test. Available at: https://www.nooz-optics.com/gb/en-
gb/eye-test (Accessed: 3 May 2020).
Nooz Optics (2020?-b) Eyewear Collections. Available at: https://www.nooz-
optics.com/us/en-us/collection/original/shop (Accessed: 2 May 2020).
Nooz Optics (2020?-c) Nooz Optics Instagram account_France [Instagram]. Available at:
https://www.instagram.com/p/B5C2DELo_AV/ (Accessed: 27 April 2020).
Nooz Optics (2020?-d) Nooz Optics Instagram account_Belgium [Instagram]. Available at:
https://www.instagram.com/p/B5C2R-GI3El/ (Accessed: 27 April 2020).
Nooz Optics (2020?-e) Nooz Optics Instagram account_Belgium and Netherlands
[Instagram]. Instagram Available at: https://www.instagram.com/p/B5C2j51opJQ/
(Accessed: 26 April 2020).

15
Passport (2019a) 'Spectacles in Brazil. Country Report.'. Available at: https://www-portal-
euromonitor-com.oxfordbrookes.idm.oclc.org/portal/analysis/tab (Accessed 30
April 2020).
Passport (2019b) 'Spectacles in South Africa. Country Report.'. Available at: https://www-
portal-euromonitor-com.oxfordbrookes.idm.oclc.org/portal/analysis/tab (Accessed
30 April 2020).
Passport (2020a) 'Brazil: Country Profile. Country Report.'. Available at: https://www-portal-
euromonitor-com.oxfordbrookes.idm.oclc.org/portal/analysis/tab (Accessed 30
April 2020).
Passport (2020b) 'South Africa: Country Profile. Country Report.'. Available at: https://www-
portal-euromonitor-com.oxfordbrookes.idm.oclc.org/portal/analysis/tab (Accessed
30 April 2020).
Passport (2020c) 'Where Consumers Shop for Eyewear'. Available at: https://www-portal-
euromonitor-com.oxfordbrookes.idm.oclc.org/portal/Analysis/Tab (Accessed 2 May
2020).
Renna, A., Vejarano, L. F., De la Cruz, E. and Alió, L. J. (2016) 'Pharmacological Treatment of
Presbyopia by Novel Binocularly Instilled Eye Drops: A Pilot Study', Ophthalmology
and Therapy, 5(1), pp. 63-73. doi: 10.1007/s40123-016-0050-x
RocketReach (2020?) Nooz Optics information. Available at: https://rocketreach.co/nooz-
optics-profile_b5668058f662c94d (Accessed: 25 April 2020).
Societe (2020) Binoptics SPRL. Societe SAS Available at:
https://www.societe.com/societe/binoptics-sprl-821549516.html (Accessed: 29
April 2020).
Solberg, C. A. (1997) 'A Framework for Analysis of Strategy Development in Globalizing
Markets', Journal of International Marketing, 5(1), pp. 9-30.
Wolffsohn, J. S. and Davies, L. N. (2019) 'Presbyopia: Effectiveness of correction strategies',
Progress in Retinal and Eye Research, 68, pp. 124-143. doi:
10.1016/j.preteyeres.2018.09.004.

16
Appendix 1

All Nooz items are delivered to the following countries:

1. Germany 19. Latvia

2. Austria 20. Liechtenstein
3. Australia 21. Lithuania
4. Belgium 22. Luxembourg
5. Bulgaria 23. Malta
6. Canada 24. Norway
7. Croatia 25. New Zealand
8. Denmark 26. The Netherlands
9. Spain 27. Poland
10. Estonia 28. Portugal
11. United States 29. Czech Republic
12. Finland 30. Romania
13. France 31. United Kingdom
14. Greece 32. Singapore
15. Hungary 33. Slovakia
16. Ireland 34. Slovenia
17. Iceland 35. Sweden
18. Italy 36. Switzerland

Nooz markets – adapted from Nooz website (Nooz Optics, 2020a)

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Appendix 2

Product range

Ready to wear reading glasses:

Accessories:

Figure 7: Nooz product range adapted from Nooz website (Nooz Optics, 2020b)

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Appendix 3

Nooz eye test available online (Nooz Optics, 2020?-a).

Figure 8: Nooz diopter test (Nooz Optics, 2020?-a)

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Appendix 4
Upstream, outsourced value chain (Hollensen, 2017, pp. 28, 131)
Source: adapted from Nooz Optics
Instagram (Nooz Optics, 2020?-c)
Source: adapted from Nooz Optics
Instagram (Nooz Optics, 2020?-d)
Source: adapted from Nooz Optics
Instagram (Nooz Optics, 2020?-e)
Manufacturing
Product design is done by a French
company Ixiade (Nooz Optics,
2020b) – an
innovation agency located in Paris
(France) (Ixiade, 2020).
Nooz’s ophthalmological expertise
is derived from a relationship with a
French ophthalmology company
(Nooz Optics, 2020b).
Polycarbonate frames are injection
moulded in France, in the region
known as Auvergne-Rhone-Alpes.
From here it is shipped within hours
for an anti-scratch coating
treatment near Bordeaux (Nooz
Optics, 2020?-c).
Once treated it sent to Belgium and
fitted with an injection moulded
elastomer that gives the Nooz
product its “unique nasal adherence
and flexibility” (Nooz Optics, 2020?-
d).
Lastly the case is produced
injection moulded and sent to the
Netherlands where it receives a
‘soft touch’ treatment that gives it a
‘Peach skin’ finish (Nooz Optics,
2020?-e) .
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Appendix 5: pages 21-22

SWOT Analysis (Dibb et al., 2016, pp. 49-52)

Strengths: Weaknesses:

• Digital marketing competency and • Limited working

omnichannel business model (Chaffey and knowledge outside of
Ellis-Chadwick, 2019) the existing markets
• Strong strategic management skills: • Limited resources – 20
• the ability to manage the upstream employees – to compete
outsourced value chain and the against LSEs (Large
downstream value chains(distribution) Scale Enterprises)
though complex negotiations (Hollensen, 2017, p. 12)
(Hollensen, 2017, p. 28). expansion to additional
• skilled in the development and markets may require
management of strategic alliances expansion of the
that enables it to compete in the existing workforce and
markets it enters (Solberg, 1997). opening new offices in
• Optical quality product designed by new locations
ophthalmologists in France – certified
medical device (Nooz Optics, 2020b) -
strong, reliable and competent supply
network
• Legally registered intellectual property /
trademark (Justia, 2020) i.e. exclusive use of
brand protected by law (Dibb et al., 2016, p.
319) – competency in global brand
management
• Entrepreneurial management style and
decision making – power to control the
company (Hollensen, 2017, p. 12) – owner
managed. Being a small, privately-owned
business decisions can be made quickly in
response to opportunity.
• Small size company employing 20 people
(RocketReach, 2020?) – high flexibility with
regards to decision making

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Opportunities: Threats:

• “In 2015, more than 2.5 billion people around • Presbyopia

the world were aged 40 years or older; given correcting eye drops
that the global population is growing and (Renna et al., 2016)
ageing, presbyopia will affect even more may disrupt
people in the future” (Renna et al., 2016, p. business by
64) reducing the
• Opportunity to expand using existing skills demand for reading
acquired from operating internationally glasses.
(Solberg, 1997) • Risks of trade
disruptions and
slowing economic
growth arising from
COVID-19 pandemic
and the possible
onset of a global
recession /
economic slowdown
could compromise
expansion into new
markets (Craven et
al., 2020)

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Appendix 6: pages 23-27
PESTLE Analysis (Dibb et al., 2016, pp. 101-103)
South Africa
Political
Democratically elected and stable
government (Passport, 2020b).
Income distribution is one of the
world’s most unequal” (Passport,
2020b), if not addressed could
potentially lead to civil unrest.
Economic
“South Africa’s economy has been
performing too poorly…”(Passport,
2020b), signalling it may not be the
right choice for Nooz.
Although performing poorly, the
economy is described as being
“globally positioned, sophisticated
and diversified”(Passport, 2020b).
This suggests it may be viable to
enter this market later as a part of a
long-term plan for the region to
establish a foothold and potentially
create an opportunity to enter other
African markets in future.
Government spending on debt is
high at ”60.2% of GDP (Passport,
2020b) and has resulted in a credit
agency downgrade to junk status
(Passport, 2020b) which has the
effect of driving down the value of
its currency, increasing the cost of
foreign goods.
Government helping to create the
African Union and NEPAD (New
Brazil
Recent requirement to deploy the
army to maintain law (Passport,
2020a) and order signals a
potentially volatile environment for a
business.
Economy is becoming more
diversified (Passport, 2020a), which
will render it increasingly more
resilient and stable. A stable
economy attracts risk averse
investment and the ensuing growth
would be good for (Nooz) business.
Brazil continues to attract foreign
direct investment (Passport, 2020a),
which suggests the economy will
continue to grow in the long term.
Public spending is 90.7% of GDP
and the country has been
downgraded to junk status
(Passport, 2020a). This has the
effect of devaluation of the currency
- which has the knock-on effect of
increasing the cost of imported
goods making them unattractive for
consumption at the lower end of the
market.
“The EU is currently negotiating a
free-trade deal with Brazil, as part
of its negotiations with Mercosur
23
Partnership for Africa’s
Development) (Passport, 2020b). It
is likely that trade co-operation with
other African countries from South
Africa will increase, creating a route
into Africa.
“Real GDP will grow by 1.3% in
2020, up from 0.3% in 2019”
(Passport, 2020b) .Private
consumption and disposable
income per household is expected
to increase (Passport, 2020b)
however, as a result of the
population expanding faster than
the economy it will lead to a fall in
the per capita income (Passport,
2020b). Ergo South Africa becomes
gradually more impoverished over
time reducing the amount of value
Nooz can derive from this country.
Modest growth (1.8% in 2021 and
2.5% per year till 2027(Passport,
2020b)) is projected and private
consumption is expected to
improve, which suggests that
beyond 2021 South Africa economy
may improve.
Value added tax has been
increased (from 14%-15%) to cover
state expenditure (Passport, 2020b)
and may signal further tax
increases in other areas of the
economy e.g. company tax, which
would drive down profits.
There is low per capita expenditure
(Passport, 2020b) and the country
(MERCOSUR, 2020)
countries”(Passport, 2020a). Once
concluded, lower trade barriers and
tariffs are expected for the region.
The economy is improving and real
GDP is rising (2.1%) (Passport,
2020a). Investment sentiment is on
the up, raising confidence in the
economy (Passport, 2020a) which is
likely to positively impact consumer
spending in the future. Interest rates
are stable and low, which is
conducive for business growth and
private consumption is on the rise.
Beyond 2021 an economic recovery
is forecasted that envisages an
annual growth of real GDP at 2.4%
between 2023-2037 (Passport,
2020a). Private consumption is
expected to rise on the back of the
recovery which makes Brazil an
attractive country to enter.
Financial transactions will attract tax
and is expected to raise USD$8
billion (Passport, 2020a) – if Nooz
opens up operations inside of Brazil
it could incur taxation on the
repatriation of funds. Currently,
taxation is high and impacts
discretionary spending in the
market and drives people into the
informal economy for cheaper
solutions (Passport, 2020a).
Brazil is economically divided
(Passport, 2020a) – the northern
region is poor with half the
24
has a large low-income population
(Passport, 2020b), suggesting that
the South African demand for Nooz
product may be small.
Growth beyond 2020 to 2030 is
expected to rise at an annual rate of
2.4% only (Passport, 2020b).
Income distribution is highly unequal
(Passport, 2020b) suggesting a very
small market for Nooz.
Social
Population is growing with the
median age rising to 29.6 years by
2030 (Passport, 2020b) indicating
that the population is youthful. The
consumption of ready to wear
reading glasses is age related so
the market will grow but is will take
time.
The income distribution is highly
skewed with 10% of the households
receiving close to half of the
disposable income (Passport,
2020b). This suggests that the
market for Nooz will be small.
household expenditure of the
southern regions. The south east
and south Brazil are the most
affluent areas and it may be
worthwhile entering only these
areas. In addition, 80% of rural
areas are amongst the poorest
(Passport, 2020a), suggesting that it
may be prudent for Nooz to target
major cities only. This would not
stretch the current resources of
Nooz.
Chinese involvement in the
economy is increasing(Passport,
2020a), which may lead to the
introduction of low priced reading
spectacles, which may disrupt the
market.
The population is growing
(Passport, 2020a). Aging population
also expected to grow, 13.6% of
total population expected to be over
65 years old by 2030 (Passport,
2020a) – this will increase the need
for spectacles/reading glasses – it’s
a growth market for Nooz.
“The ageing population positively
impacts the consumption of
spectacles” (Passport, 2019a)
25
 Technological
New treatments are being New treatments are being
researched for presbyopia that researched for presbyopia that
could in future eliminate the need could in future eliminate the need
for ready to wear reading glasses. for ready to wear reading glasses.
Advances in medical research could Advances in medical research could
disrupt the market (Renna et al., disrupt the market (Renna et al.,
2016). 2016).

Environmental
There would be no direct impact There would be no direct impact
arising from the arising from the
environment/sustainability, although environment/sustainability, although
it may be recommended that if it may be recommended that if
entering this market plastic recycling entering this market plastic recycling
should be considered as the Nooz should be considered as the Nooz
product is made of plastics. product is made of plastics.
Legal
The “…regulatory environment not Brazil Judiciary is dysfunctional
conducive to private investment…” (Passport, 2020a) and it may be
(Passport, 2020b). Stringent labour difficult to seek legal remedy in the
laws and unproductive workforce event of a commercial dispute. For
will present a challenge for a start- Nooz this means stringent
up business. Using local established screening of potential distributors /
agent or distributor, who knows how business partners.
to operate in this environment,
would reduce the risk.
The Supreme court of Appeal ruling
that the ex-president should face
charges of fraud, corruption, money
laundering etc. (Passport, 2020b)
signals a strong independent
judiciary in South Africa. This
signals a strong rule of law and
lowers the risk of having contracts
that are not upheld.

26
 Ethics
Corruption (Passport, 2020b) is an
issue in this business environment
and Nooz should make it clear to
potential distributors or partners that
it works within the laws of the land
in which it conducts its business.
Corruption is an issue in this
business environment (Passport,
2020a) and Nooz should make it
clear to potential distributors or
partners that it works within the laws
of the land that it conducts its
business
27
Appendix 7

Sales trends and forecast of readymade reading glasses in Brazil (Figure 8) and
South Africa (Figure 9) in respective local currencies.

Brazil

Figure 9: Sales of Readymade Reading Glasses (Passport, 2019a)

South Africa

Figure 10: Sales of Readymade Reading Glasses (Passport, 2019b)

28
Appendix 8

Brand shares of spectacles in Brazil (Passport, 2019a) – red circles indicate brands
used in the analysis of Nooz competitive set in Brazil.

Figure 11: Brand shares of spectacles in Brazil adapted from (Passport, 2019a)

29