Analyzing Market Entry to Ivory Coast Term Paper

Market Entry to Ivory Coast

Company Profile and Background

Market Analysis- Ivory Coast

Risk Analysis

Social and Cultural Analysis

Economic Analysis

Political and Legal Analysis

Market Entry Strategies

Marketing Mix

Product

Promotion

Price

Place and Distribution

Branding

Market Entry to Ivory Coast

Company Profile and Background

Barilla Group is an Italian food company whose headquarters are located in the city of Parma. The company also has its operations in various nations in Europe. Barilla was established in the year 1877, initially as a bakery shop and was set up as a family business. In the present, the company is still controlled by the Barilla family. The company is renowned and has established itself as a multinational pasta maker. In particular, the group undertakes the production of numerous kinds of pasta and is actually the leading pasta maker across the globe. The company has a market share of about 45% in Italy and also 25% of the market share in the United States. The Group produces pasta that is of more than 120 different sizes and shapes as well. The pasta of the Barilla brand is retailed in several restaurants across the world (Barilla Website, 2016).

Barilla Group has extensively expanded its business operations across Europe and also in the United States. The international company has great proficiency and expertise in this aspect and therefore is well poised into entering the African Market. In this case, Ivory Coast is selected as a good prospect and market for the Group to bring its operations and products. The Barilla group has a number of brands across the world. As pointed out, the company is the leading pasta maker and brand in the world and is also the leading sauce brand in Europe. In this case, the product in consideration that the company will introduce in Ivory Coast is its well renowned pasta (Barilla Website, 2016).

Market Analysis- Ivory Coast

General Information

Cote d'Ivoire, also referred to as Ivory Coast, is one of the fastest growing economies in the globe and also one of the highly potent economies in West Africa. The capital city of the nation is Yamoussoukro and the country's largest city is the port of Abidjan. It is imperative to note that during the 1960s and 1970s, Ivory Coast was an economic driving force and livewire in West Africa, owing to the production of cocoa and coffee. Important statistics include the fact that the economic growth of the country in the 2014 fiscal year was 7.8% with an inflation rate of 0.4%. In addition, the Gross Domestic Product (GDP) per capita of Ivory Coast was $3,100. The country's foreign direct investment in the same financial year was 1.19. Ivory Coast has a population of over 23 million people. It is appealing to several investors. In accordance to Euromonitor International (2014), the country is considered to be one of the twenty markets of the future that will offer the most prospects for consumer goods companies across the world.

Risk Analysis

In undertaking the risk assessment of Ivory Coast, there are a number of factors that have to be taken into consideration with Barilla making its entry into the market. For starters, there is great corruption. For instance, in the 2015 fiscal year, the nation scored just 32 points out of 100 in the Corruption Perceptions as pointed out in a report done by Transparency International (Trading Economics, 2016). This is an all-time high compared to the score of 19 in the 2004 fiscal year. This can make it difficult for the company in setting up its business. Another factor is that there is a high prevalence of crime in the country. This in turn increases the level of difficulty in doing business, particularly foreign companies. Another aspect is that there is a high tax burden in general that is laid on foreign companies.

Social and Cultural Analysis

Ivory Coast is a nation that is socially intricate. Having more than 20 million people, it is approximated that roughly 5 million of them are immigrants coming from Burkina Faso and Mali. In addition, the country has more than 50 various local ethnic groups, which are categorized into four particular groups, including the Akan, Krous, the Voltaiques and the Mande. The most populated city in Ivory Coast is Abidjan, which consists of approximately 4 million inhabitants, with the other cities Yamoussoukro, Bouake and San Pedro following closely. More so, with regard to the nation's religious affiliation, the population subsisting in the northern half of the nation is for the most part Muslim, encompassing just over 38%, while the southern half of the nation is largely made up of Christians, who represent just over 32%. The remaining 28% or so is made up of tribal religions that are predominant over the entire nation's territory (Linn, 1977).

Taking into consideration that Ivory Coast has set itself as one of the most prosperous and successful West African countries, approximately 20% of the populaces, roughly 3.4 million people, is made up of workers who come from the neighboring nations of Guinea, Burkina Faso and Liberia. Statistics indicate that 4% of the populace is of non-African lineage. It is imperative to take note that a great deal and majority of the adult inhabitants, especially women, are illiterate. More so, a great deal of the students in secondary schools, are made up of male individuals. Generally, in Ivory Coast, there are more than 60 native ethnic groups, but can be decreased into seven main ethnic groups, with regard to common historical and cultural features and individualities (Linn, 1977).

Economic Analysis

The economy of Ivory Coast in the 21st Century is for the most part market-oriented and largely depends on agriculture, with the cash crop production of the smallholders being prevalent. In particular, the agricultural sector takes into account 60% of the labor force. A great deal of the labor force in the country is connected to agriculture and forestry. The main cash crops in Ivory Coast are cocoa, coffee, bananas, sugar cane, pineapple and cotton. In particular, it is imperative to note that Cote d'Ivoire is amongst the largest producers as well as exporters of palm oil, coffee and cocoa beans in the world (Ovalle, 2012).

The production of wood is of massive economic significance in the nation. Some of the most significant exports of timber consist of the obeche, mahogany, the SIPO, iroko and makore. Every year, it is projected that Ivory Coast produces roughly more than 10 million cubic meters of wood. Another important economic activity is fishing, which is carried out largely along the coastline that stretches more than 500 kilometers. It is projected that Ivory Coast has an annual catch amount number of more than 55,000 tonnes. Minerals are another substantial economic activity that boosts the nation. In the year 1977, the nation discovered oil fields and three years later, started oil extraction. By 2005, the nation was producing about 12 million barrels of oil every year. In addition, it is estimated that the nation has an annual production of approximately 600,000 metric carats of diamond (Ovalle, 2012).

Relative economic stability has in the contemporary returned to Cote d'Ivoire, which in turn, has caused the economy of the country to grow at about 9% in the 2013 fiscal year and 8% in the 2014 fiscal year. In the 2014 financial year, the gross domestic product per capita of the nation was documented to be 1,154 U.S. dollars. Taking this into consideration, the GDP per capita of the nation is equal to 9% of the world's average. In accordance to a report outlined by the World Bank, it was indicated that the simplicity and comfort in undertaking business in Ivory Coast had an improvement going up to 147 in the 2015 fiscal year down from 158 in the preceding 2014 fiscal year (Raza, 2015). France is considered to be by far and large the most significant foreign investor, with high ranking numbers in foreign direct investment. Lastly, with respect to labor, there is a massive availability of labor as a result of its huge working-age populace; workforce migrated from neighboring nations and large rates of urbanization in the country's regions. Therefore, there is a large quantity of low and semi-skilled labour (Raza, 2015).

Political and Legal Analysis

Ivory Coast is a nation that has a strong executive power vested in the President of the nation. In particular, Cote d'Ivoire is split into nineteen regions and eighty-one departments. One of the worrying aspects in this setting is the prevailing civil war. In the year 1999, the country experienced a Coup d' tat and three years later in 2002, a civil war broke out in the country. However, the private sector has since then regained confidence in the economy of Ivory Coast. In the past year, there were presidential elections and through the voting in of Alassane Ouattara, the general public indicates that they had a desire to cement the nation and to be able to overcome a past that…