Term Paper on "Profiling X-Quisite, an International Firm Organization"

Term Paper 9 pages (2302 words) Sources: 5 Style: APA

[EXCERPT] . . . .

Profiling X-Quisite, an International Firm

Organization Type

Planning

Market Assessment

Marketing Strategy

Organizational Structure

Organizational Culture

Locations of the Organization

Business Operations

Company's approach to issues such as: environment, political, social, economic, legal and labor forces of the international economy

The present paper aims at creating the profile of an International Firm that the author would like to establish as an entrepreneur. This Firm will be thus analyzed from the perspective of various, such as: organization type, strategy, planning, market assessment, marketing strategy, organizational structure and culture, locations of the organization, and business operations.

The company projected is a "Natural Body Care" company, named "X-Quisite," and that has at its most defining characteristic the sustainable use of natural ingredients in order to deliver well-being to persons it touches - its consumers.

Organization Type

As previously stated, the organization created is a manufacturer of natural body care products, whose products enter in categories such as skin and hair care, make-up, solar protection, among others.

X-Quisite will be launched at first as a private company, with the possibility to have its listing with the Stock Exchange after reaching the necessary size and of course, if at the moment the entrepreneur desires this.

X-Quisite will have its own laboratories that will be using natural ingredients coming from 100% natural sources, one of them being most probably the Amazonian Forrest. For this reason, the sustainability related concerns will be further detailed inside the "Business Operation" chapter.

Strategy

X-Quisite will enter on a world market that desires more and more natural products, (Passariello, 2008) but that needs to obtain them in a matter that takes care of the environment. This makes corporate social responsibility (CSR) a must for the strategic approach of X-Quisite.

Besides its Headquarters and distribution network in the U.S., the company will have its own laboratories and research centers and will work at least at the beginning on the "consultant" system used by other firms in the market, such as Avon and Oriflame, having thus a better penetration power with relatively lower costs.

Depending on a study to be developed previous to its creation, should be decided where to be located. Latin America will be the target for such investments given the abundance of such natural resources. Most probable, taking into account Brazil's natural conditions (contains most of the Amazonian Forrest on its territory) and, with the exception of Chile, has one of the most positive outlooks for economic growth on long-term, it might just become the destination of these first investments. Nevertheless, Chile is also a good target country, especially given the recent Free Trade Agreements with the U.S. entered in force, which thus give support to developing businesses in the region (Barrett, 2008). Also, one must take advantage that Latin America is now a market of more than half a billion people, with less daunting language barriers and cultural differences than other interesting destinations such as Asia... And this is especially valid for most Americans. Latin American combined economies are expected to know a growth of 5.45% in 2008, three times higher than U.S.'s 1.3% (Barrett, 2008)

With the development of business, other future markets for product commercialization can be Eastern Europe and Asia, observing that the economic growth of the last two regions has been forecasted to 7.8% (without Japan - with forecasted growth of 2%) and respectively 6.2% for 2008 (Young, 2007). Additionally, countries in emerging Europe and China, for example, present significantly growth in skin care products. (Passariello, 2008)

Planning

For the beginning of the business, planning will be based largely on the feedback from the market studies to be developed in the U.S. And Latin America. Once the business is functional, a long-term planning meeting should have place every 5 years in order to decide on long-term goals that should be therefore implemented at local level (depending on the units to be created). Local annual planning meetings will be established, in order to keep track of the long-term goals and the way these are being achieved or not and therefore decide strategic actions for the following year.

Market Assessment

The main markets to be assessed in view of the establishment of X-Quisite are the U.S. market and the Latin American market, with a strong focus on Brazil, given the opportunities presented in the "Strategy" section.

As a 2007 study of Research and Markets analyzing the body care market in the United States, one can notice an increase of 10% of sector market value from 2004 until 2006, from $2 Billion up to $2.2 Billion. (Research and Markets, 2007). The same study reports a continuous growth of the body care market between 2001 and 2006. The two channels used by the market were: premium retailers and mass channels, both of them having registered significant growth from client groups that want to ward off the effects of aging, that have interest in natural or active ingredients, and that become every day more interested in personal health and wellness.

The market was reinforced in the years 2004 and 2006 by various new products entering the market, each of them advertising scientific positioning or innovation as strengths. Most of these products were anti-aging, pampering, herbal/botanical, self-tanning and of similar purposes, the same study comments.

The body care industry's core customers continue to be the aging consumers and especially women, even though ethnic consumer, men and teenagers begin to represent viable demographic niches, as long as the firms on the market know ho to keep pace with their particular needs (Research and Markets, 2007).

The future of the U.S. body care market appears to be a strong one, especially because its consumers are searching for specialized products to be found easily and at more affordable prices - especially in the case of anti-aging effect products (Research and Markets, 2007).

In the case of Latin America and especially Brazil, the latter has placed itself - from a cosmetic and personal care market point-of-view - as one of the fastest growing and promising markets. It is the largest cosmetics and personal care products market in Latin America and one of the top five such markets in the world, offering thus great investment opportunities. The upward trend is set to continue, as the rising cosmetic consumption couples with the continuous increase in income levels (Bharat Book Bureau, 2008).

Besides its positive consumption premises, Brazil offers also low cost for manufacturing facilities, and government support aiming at development of infrastructure. The same study presents for Brazil, in the period between 2008 and 2011, a CAGR rate of growth for the per capita consumption of cosmetics and personal care products of 15.49% - a quite significant number (Bharat Book Bureau, 2008)

Marketing Strategy

On the U.S. market, X-Quisite should approach each target market in a dedicated manner. Mainly TV commercial and freely distributed catalogues can be the starting point of the marketing approach, with specific presence in specific ethnical TV or radio station (for Hispanic, Asian or Black population) and materials to be adequately translated into the target costumer's language. Free samples of the products should also be distributed.

Involvement in Sustainable Development practices (which, in any case will be part of the company's day-to-day practices) should be also used as a Marketing Tool.

In the Latin American market, contact with regionally specialized marketing and advertising companies should be started, in order to adapt the approach to the particularities of the consumers.

Very briefly, the image that X-Quisite should transmit about its products and its personality as a personal care company should be based on the idea that the wild nature combines its little miracles in order to bring new energy and the feeling of well-being to its consumer, and that X-Quisite is just the instrument to help in this transfer of energies.

Organizational Structure

The most adequate structure for an organization of X-Quisite's type could be the Matrix structure, which would combine the line of products and geographical divisions. matrix structure that combines geographical with product divisions. In this way, the product line-based structure would allow X-Quisite to take advantage of global economies of scale, while the geographic structure will allow the know-how to be retained close to the needs of individual regions or countries.

Organizational Culture

The employees are essential to the creation of a company's brand, in our case, X-Quisite. They are the ones that give a certain shape to the internal culture and, along with other means, will transmit the values of the company to the outer world. Therefore, special attention should be taken care regarding internal climate and approval index. This could be obtained by insuring open dialogue between the employees and the top management as well as facilitation of regular feedback, and therefore insuring a lower level of power distance (Hofstede, 80).

Technical and personal training should support the preparation of X-Quisite's employees, with a minimum goal of 80 annual training hours in average.

Ideally, the organization should construct a sense of cohesion, with its goals and vision strongly shared… READ MORE

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