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III. Market Audit and Competitive Market Analysis
Guideline
I. Introduction
Regenerated yarns industry started in Europe specially Italy & Spain then moved to Turkey &
Egypt at the same time also moved to Far East China & Indonesia according to the high labor
& power cost.
Regenerated Yarns simply considered the cheapest Yarns as there is no comparison between the
cotton price & the cotton waste price.
II. The product
Chief value cotton regenerated yarn mixed with different percentages of polyester and acrylicin white and coloursAcrylic regenerated yarn in white & colours. Yarn Counts From Ne 3 (Nm 5) to Ne 12 (Nm 20.3)in single & twisted.
*. Evaluate the product as an innovation as it is perceived by the intended market
The usage of the regenerated yarns provide the blending flexibility & the yarns cost controlling
1. Relative advantageThe advantage of regenerated yarns is that it match the global trend of environmental approach as the
regenerated yarns deducting the usage of dying chemicals with the respect of the buyer quality needs.
2. Compatibility
The product match the green industry concept providing the same level of quality .
3. Complexity
No special skills needed to use the product much more its more simple than using the normal cottonyarns .
4. Trial ability
To produce the company we could offer an industrial trails .
5. Observability
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Most of end consumers appreciate the recycled products but if the final product will be exported
outside euorpe maybe we should do some educatinal actions if this concept is not a cultural
accepted.
III. The market
Our customers are the knitting & weaving producers, the strength we have & we could build a goodmarketing plan on it that our yarns is cheap with the worldwide quality standards ,the main constrainswe could face is the European competitors prices thats mean we have to make the balance of thelower price with the respect of the quality , as the European competitors quality is much better thanours but we could compete with them with our prices .
A. Describe the market(s) in which the product is to be sold
Our customers devided to two main categiories :
a- Knitting Manfacturers ( producers of sport socks and Knitting Fabrics T-shirts ).b- Weaving Manfacturers ( producers of Heavy fabrics used for tents , Furneture Fabrics)
1. Geographical region(s)
Location:
metropolitan France: Western Europe, bordering the Bay of Biscay andEnglish Channel, between Belgium and Spain, southeast of the UK;
bordering the Mediterranean Sea, between Italy and Spain
French Guiana: Northern South America, bordering the North AtlanticOcean, between Brazil and Suriname
Guadeloupe: Caribbean, islands between the Caribbean Sea and the North
Atlantic Ocean, southeast of Puerto RicoMartinique: Caribbean, island between the Caribbean Sea and North Atlantic
Ocean, north of Trinidad and Tobago
Mayotte: Southern Indian Ocean, island in the Mozambique Channel, abouthalf way between northern Madagascar and northern Mozambique
Reunion: Southern Africa, island in the Indian Ocean, east of Madagascar
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Geographic coordinates:
metropolitan France: 46 00 N, 2 00 E
French Guiana: 4 00 N, 53 00 W
Guadeloupe: 16 15 N, 61 35 W
Martinique: 14 40 N, 61 00 W
Mayotte: 12 50 S, 45 10 E
Reunion: 21 06 S, 55 36 E
Map references:
metropolitan France: Europe
French Guiana: South America
Guadeloupe: Central America and the Caribbean
Martinique: Central America and the Caribbean
Mayotte: Africa
Reunion: World
Area:
total: 643,801 sq km; 551,500 sq km (metropolitan France)
country comparison to the world:43
land: 640,427 sq km; 549,970 sq km (metropolitan France)
water: 3,374 sq km; 1,530 sq km (metropolitan France)
note:the first numbers include the overseas regions of French Guiana,Guadeloupe, Martinique, Mayotte, and Reunion
Area - comparative:
slightly less than the size of Texas
Land boundaries:
metropolitan France - total: 2,889 km
border countries: Andorra 56.6 km, Belgium 620 km, Germany 451 km,Italy 488 km, Luxembourg 73 km, Monaco 4.4 km, Spain 623 km,Switzerland 573 km
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French Guiana - total: 1,183 km
border countries: Brazil 673 km, Suriname 510 km
Coastline:
total: 4,853 km
metropolitan France: 3,427 km
Maritime claims:
territorial sea: 12 nm
contiguous zone: 24 nm
exclusive economic zone: 200 nm (does not apply to the Mediterranean)
continental shelf: 200 m depth or to the depth of exploitation
Climate:
metropolitan France: generally cool winters and mild summers, but mild
winters and hot summers along the Mediterranean; occasional strong,cold, dry, north-to-northwesterly wind known as mistral
French Guiana: tropical; hot, humid; little seasonal temperature variation
Guadeloupe and Martinique: subtropical tempered by trade winds;moderately high humidity; rainy season (June to October); vulnerable todevastating cyclones (hurricanes) every eight years on average
Mayotte: tropical; marine; hot, humid, rainy season during northeasternmonsoon (November to May); dry season is cooler (May to November)
Reunion: tropical, but temperature moderates with elevation; cool and dry(May to November), hot and rainy (November to April)
Terrain:
metropolitan France: mostly flat plains or gently rolling hills in north and
west; remainder is mountainous, especially Pyrenees in south, Alps ineast
French Guiana: low-lying coastal plains rising to hills and small mountains
Guadeloupe: Basse-Terre is volcanic in origin with interior mountains;Grande-Terre is low limestone formation; most of the seven other islandsare volcanic in origin
Martinique: mountainous with indented coastline; dormant volcano
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Mayotte: generally undulating, with deep ravines and ancient volcanic peaks
Reunion: mostly rugged and mountainous; fertile lowlands along coast
Elevation extremes:
lowest point: Rhone River delta -2 m
highest point: Mont Blanc 4,807 m
note:in order to assess the possible effects of climate change on the ice and
snow cap of Mont Blanc, its surface and peak have been extensivelymeasured in recent years; these new peak measurements have exceededthe traditional height of 4,807 m and have varied between 4,808 m and
4,811 m; the actual rock summit is 4,792 m and is 40 m away from theice-covered summit
Natural resources:
metropolitan France: coal, iron ore, bauxite, zinc, uranium, antimony,arsenic, potash, feldspar, fluorspar, gypsum, timber, fish
French Guiana: gold deposits, petroleum, kaolin, niobium, tantalum, clay
Land use:
arable land: 33.46%
permanent crops: 2.03%
other: 64.51%note:French Guiana - arable land 0.13%, permanent crops 0.04%, other
99.83% (90% forest, 10% other); Guadeloupe - arable land 11.70%,permanent crops 2.92%, other 85.38%; Martinique - arable land 9.09%,permanent crops 10.0%, other 80.91%; Reunion - arable land 13.94%,permanent crops 1.59%, other 84.47% (2005)
Irrigated land:
total: 26,950 sq km;
metropolitan France: 26,700 sq km (2008)
Total renewable water resources:
189 cu km (2005)
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https://www.cia.gov/library/publications/the-world-factbook/geos/fr.html
2. Forms of transportation and communication available in that (those)
region(s)
Freshwater withdrawal(domestic/industrial/agricultural):
total: 33.16 cu km/yr (16%/74%/10%)
per capita: 548 cu m/yr (2000)
Natural hazards:
metropolitan France: flooding; avalanches; midwinter windstorms; drought;forest fires in south near the Mediterranean
overseas departments: hurricanes (cyclones); flooding; volcanic activity(Guadeloupe, Martinique, Reunion)
Environment - current issues:
some forest damage from acid rain; air pollution from industrial and vehicleemissions; water pollution from urban wastes, agricultural runoff
Environment - international agreements:
party to: Air Pollution, Air Pollution-Nitrogen Oxides, Air Pollution-
Persistent Organic Pollutants, Air Pollution-Sulfur 85, Air Pollution-Sulfur 94, Air Pollution-Volatile Organic Compounds, Antarctic-Environmental Protocol, Antarctic-Marine Living Resources, Antarctic
Seals, Antarctic Treaty, Biodiversity, Climate Change, Climate Change-Kyoto Protocol, Desertification, Endangered Species, Hazardous Wastes,Law of the Sea, Marine Dumping, Marine Life Conservation, OzoneLayer Protection, Ship Pollution, Tropical Timber 83, Tropical Timber
94, Wetlands, Whaling
signed, but not ratified: none of the selected agreements
Geography - note:
largest West European nation
Airports - with paved runways:
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total: 297
over 3,047 m: 14
2,438 to 3,047 m: 27
1,524 to 2,437 m: 98
914 to 1,523 m: 83
under 914 m: 76 (2010)
Airports - with unpaved runways:
total: 177
914 to 1,523 m: 69
under 914 m: 108 (2010)
Heliports:
1 (2010)
Pipelines:
gas 15,276 km; oil 2,939 km; refined products 5,084 km (2010)
Railways:
total: 29,640 km
country comparison to the world:9
standard gauge: 29,473 km 1.435-m gauge (15,361 km electrified)
narrow gauge: 167 km 1.000-m gauge (63 km electrified) (2009)
Roadways:
total: 951,200 km (metropolitan France; includes 11,100 km of expressways)
country comparison to the world:8
note:there are another 5,100 km of roadways in overseas departments (2008)
Waterways:
metropolitan France: 8,501 km (1,621 km accessible to craft of 3,000 metrictons) (2010)
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3. Consumer buying habits
We have two main segments in our market :
1- The industrial (factories).2- The traders.
Buying habitsThe consumer buying habits depend on his production plans so usually its a long term contracts
with huge quantities
4. Distribution of the product
Traditional distribution channels recommended . . Product sales by other middlemen
Traders or middlemen will be useful in market penetration
5.Advertising and promotion
. Sales promotions customarily used (sampling)Only the sampling could be useful
6. Pricing strategy
We will use our normal strategy as there is no need for change.
country comparison to the world:16
Merchant marine:
total: 167
country comparison to the world:38
by type: bulk carrier 2, cargo 8, chemical tanker 36, container 25, liquefiedgas 12, passenger 11, passenger/cargo 44, petroleum tanker 17,
refrigerated cargo 1, roll on/roll off 11
foreign-owned: 57 (Belgium 7, China 5, Denmark 12, French Polynesia 12,Germany 1, New Caledonia 3, Norway 1, NZ 1, Singapore 3, Spain 1,
Sweden 6, Switzerland 5)
registered in other countries: 146 (Bahamas 19, Belgium 5, Bermuda 1,
Canada 1, Cyprus 16, Egypt 1, Hong Kong 3, Indonesia 1, Italy 2,Luxembourg 16, Malta 13, Morocco 4, Netherlands 2, Norway 4, Panama13, Saint Vincent and the Grenadines 2, Singapore 3, South Korea 1,Taiwan 1, UK 33, US 4, unknown 1) (2010)
Ports and terminals:
Calais, Dunkerque, Le Havre, Marseille, Nantes, Paris, Rouen
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B. Compare and contrast your product and the competitions product(s)The competition could be divided into two main groups:1- The quality. Our product is in the second category of quality after the European
product & after it the Turkish on the 3rd grade then finally the Asian2- The price. Our product & the Turkish are in the second category after the Asian
products
1. Competitors product
The following description ofcompetitors products (European ,Turkish & Asian )
a. Brand name
No sounded names in the yarn industry.b. Features
Regenerated color yarns From Ne. 3/1 to Ne. 12/1 , cotton / Polyester Blends from 70/30 to 50/50
c. Package
Wooden Pallets / Plastic Bags.
2. Competitors prices
European products 20% higher. $3.00 to $2.50
Turkish products same price. $2.50 to $2.50
Asian products 20% less .$ 2.00 to $2.50
3. Competitors promotion and advertising methods
Exhibitions are the Basic advertising methods & promotions only could happened in sampling
4. Competitors distribution channels
Direct B2B sales + trading agents.
C. Market size
According to personal invistgations with our european agents we found that france is a good potentialfor our product & there is a good chance to penetrate this market.
*. Estimated sales for your company for the planning year
720 Tons of Yarns
D. Government participation in the marketplace
* . Agencies that can help you
The French chamber of commerce
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IV. Preliminary Marketing Plan
Guideline
I. The marketing planOur plan to penetrate this market is to contact customer direct through our Marketing team + findingout 2 agents , also we should increase our presence in the European textile exhibitions
A. Marketing objectives
1. Expected sales 2012
720 Tons.
2. Profit expectations 2012
$ 712,000
3. Market penetration and coverage
Market Coverage is impossible but penetration is possible
B. Promotion mix
A. PromotionsOnly sampling
B. AdvertisingOnly Through exhibitions
D. Distribution: From origin to destination
1. Port selection
Final selection depends on customer preferences.a. Origin port
Alexandriab. Destination port
Marseille& Paris
2. Mode selection: Advantages/disadvantages of each modeA. Ocean carriersMost of the European ports have The Same shipping costB. Motor carriersTruck available with the same prices we have in the European area
3. Packing
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Wooden Pallets covered with stretcha. Marking and labeling regulationsThe standard required labeling for the global trade.b. Containerization
Goods must be loaded carefully in a way which insure that the discharging of the container will go
without any problems with mechanical equipments .c. Costs
The normal cost will be enough & no need to add any additional costs.
4. Documentation required
a. Bill of ladingb. Commercial invoice
c. Pro forma invoiced. Shippers export declaratione. Statement of origin
f. Euro 1 certificate
E. Channels of distribution (micro analysis)
Only agents are the available & required distribution channel.
1. Import/export agents
Agents useful for business introducing as they already have customers with previous business relations& it will be easier to convince new buyers to try our products.Good agent could distribute at least 100 tons monthly .
F. Price determination
To penetrate this market we dont have to change prices what we have to do is sending industrial
samples free of charge to the customers.
1. Cost of the shipment of goods
From $ .10 to $.11 per Kg.
2. Insurance costs
About .005 % from the goods value.
3. Customs duties
Duty Free
4. Companys gross margins
$ 720,000 for the first year.
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G.Terms of sale
Always the term of sales negotiable & we have to
1. EX works, FOB, C&F, CIF
2. Advantages/disadvantages of each
All the same For our product
H. Methods of payment
In markets penetrations & new business LCs is the most preferred method of payment.
1. Cash in advance
Not applicable
2. Open accounts
Not applicable.
3. Sight, time, or date drafts
Not applicable.
4. Letters of credit
Required & comfortable for all parties.
II. Pro forma financial statements and budgets
A. Marketing budget
Total needed budget $ 10,000
1. Advertising/promotion expense
Around $3,000 as a sampling cost.
2. Distribution expense
3% commission from the total sales
B. Pro forma annual profit and loss statement (first year and fifth year)
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This data is confidential.
III. Resource requirements
A. Finances
No finance needed.
b. Production capacity
11 tons daily.
IV. Executive summary
From reviewing the country data we found that its a good potential market , we could compete &
penetrate this market for the following reasons :
1- We have the (Euro - 1) Agreement, thats mean that our product will be much cheaper thanother countries by 19.6% which is the VAT rate.
2- We have the chance to convince a lot of buyer using the environmental approach as ourproduct is recycled & there is a strong demand on these products in Europe.
3- The quality we will offer will be in the European acceptance zone.4- The faster delivery than the Asian competitors will give advantage to satisfy the customers.5- Also the distance gives us another advantage in the ocean freight rates.6- We have the same packing criteria as the European producers.7- Understanding the cultural background could give us the credibility needed to penetrate this
market.
8- We dont have to change our pricing policy or make any modifications in our product . 9- The profit margins we will achieve from penetrating this market is reasonable comparing withthe cost of this penetration.
10-As France considered from the biggest fashion & textile countries its a big gain to put ourbusiness position with French companies in our company profile.
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III. Market Audit and Competitive Market Analysis
Guideline
I. Introduction
Regenerated yarns industry started in Europe specially Italy & Spain then moved to Turkey &Egypt at the same time also moved to Far East China & Indonesia according to the high labor &power cost.
Regenerated Yarns simply considered the cheapest Yarns as there is no comparison betweenthe cotton price & the cotton waste price.
II. The product
Chief value cotton regenerated yarn mixed with different percentages of polyester and acrylic
in white and coloursAcrylic regenerated yarn in white & colours. Yarn Counts From Ne 3 (Nm 5) to Ne 12 (Nm
20.3) in single & twisted.
*. Evaluate the product as an innovation as it is perceived by the intended marketThe usage of the regenerated yarns provide the blending flexibility & the yarns cost controlling
Relative advantageThe advantage of regenerated yarns is that it match the global trend of environmental approach
as the regenerated yarns deducting the usage of dying chemicals with the respect of the buyer qualityneeds.
2. CompatibilityThe product match the green industry concept providing the same level of quality .
3. Complexity
No special skills needed to use the product much more its more simple than using the normalcotton yarns .
4. Trial abilityTo produce the company we could offer an industrial trails .5. Observability
Most of end consumers appreciate the recycled products but if the final product will beexported outside euorpe maybe we should do some educatinal actions if this concept is not a culturalaccepted.
III. The market
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Our customers are the knitting & weaving producers, the strength we have & we could build agood marketing plan on it that our yarns is cheap with the worldwide quality standards ,the mainconstrains we could face is the European competitors prices thats mean we have to make the balanceof the lower price with the respect of the quality , as the European competitors quality is much better
than ours but we could compete with them with our prices .
A. Describe the market(s) in which the product is to be sold
Our customers devided to two main categiories :Knitting Manfacturers ( producers of sport socks and Knitting Fabrics T-shirts ).b- Weaving Manfacturers ( producers of Heavy fabrics used for tents , Furneture Fabrics)
1. Geographical region(s)
Location:
metropolitan France: Western Europe, bordering the Bay of Biscay and English Channel,between Belgium and Spain, southeast of the UK; bordering the Mediterranean Sea, between Italyand Spain
French Guiana: Northern South America, bordering the North Atlantic Ocean, betweenBrazil and Suriname
Guadeloupe: Caribbean, islands between the Caribbean Sea and the North Atlantic Ocean,southeast of Puerto Rico
Martinique: Caribbean, island between the Caribbean Sea and North Atlantic Ocean, northof Trinidad and Tobago
Mayotte: Southern Indian Ocean, island in the Mozambique Channel, about half waybetween northern Madagascar and northern Mozambique
Reunion: Southern Africa, island in the Indian Ocean, east of Madagascar
Geographic coordinates:
metropolitan France: 46 00 N, 2 00 EFrench Guiana: 4 00 N, 53 00 WGuadeloupe: 16 15 N, 61 35 WMartinique: 14 40 N, 61 00 WMayotte: 12 50 S, 45 10 EReunion: 21 06 S, 55 36 E
Map references:
metropolitan France: Europe
French Guiana: South AmericaGuadeloupe: Central America and the CaribbeanMartinique: Central America and the CaribbeanMayotte: AfricaReunion: World
Area:
total: 643,801 sq km; 551,500 sq km (metropolitan France)
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country comparison to the world: 43land: 640,427 sq km; 549,970 sq km (metropolitan France)water: 3,374 sq km; 1,530 sq km (metropolitan France)note:the first numbers include the overseas regions of French Guiana, Guadeloupe,
Martinique, Mayotte, and Reunion
Area - comparative:
slightly less than the size of Texas
Land boundaries:
metropolitan France - total: 2,889 kmborder countries: Andorra 56.6 km, Belgium 620 km, Germany 451 km, Italy 488 km,
Luxembourg 73 km, Monaco 4.4 km, Spain 623 km, Switzerland 573 kmFrench Guiana - total: 1,183 kmborder countries: Brazil 673 km, Suriname 510 km
Coastline:
total: 4,853 kmmetropolitan France: 3,427 km
Maritime claims:
territorial sea: 12 nmcontiguous zone: 24 nmexclusive economic zone: 200 nm (does not apply to the Mediterranean)continental shelf: 200 m depth or to the depth of exploitation
Climate:
metropolitan France: generally cool winters and mild summers, but mild winters and hotsummers along the Mediterranean; occasional strong, cold, dry, north-to-northwesterly wind
known as mistralFrench Guiana: tropical; hot, humid; little seasonal temperature variationGuadeloupe and Martinique: subtropical tempered by trade winds; moderately high
humidity; rainy season (June to October); vulnerable to devastating cyclones (hurricanes) everyeight years on average
Mayotte: tropical; marine; hot, humid, rainy season during northeastern monsoon(November to May); dry season is cooler (May to November)
Reunion: tropical, but temperature moderates with elevation; cool and dry (May toNovember), hot and rainy (November to April)
Terrain:
metropolitan France: mostly flat plains or gently rolling hills in north and west; remainderis mountainous, especially Pyrenees in south, Alps in east
French Guiana: low-lying coastal plains rising to hills and small mountainsGuadeloupe: Basse-Terre is volcanic in origin with interior mountains; Grande-Terre is low
limestone formation; most of the seven other islands are volcanic in originMartinique: mountainous with indented coastline; dormant volcanoMayotte: generally undulating, with deep ravines and ancient volcanic peaksReunion: mostly rugged and mountainous; fertile lowlands along coast
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Elevation extremes:
lowest point: Rhone River delta -2 mhighest point: Mont Blanc 4,807 mnote:in order to assess the possible effects of climate change on the ice and snow cap of
Mont Blanc, its surface and peak have been extensively measured in recent years; these new peakmeasurements have exceeded the traditional height of 4,807 m and have varied between 4,808 mand 4,811 m; the actual rock summit is 4,792 m and is 40 m away from the ice-covered summit
Natural resources:
metropolitan France: coal, iron ore, bauxite, zinc, uranium, antimony, arsenic, potash,feldspar, fluorspar, gypsum, timber, fish
French Guiana: gold deposits, petroleum, kaolin, niobium, tantalum, clay
Land use:
arable land: 33.46%permanent crops: 2.03%
other: 64.51%note:French Guiana - arable land 0.13%, permanent crops 0.04%, other 99.83% (90%forest, 10% other); Guadeloupe - arable land 11.70%, permanent crops 2.92%, other 85.38%;Martinique - arable land 9.09%, permanent crops 10.0%, other 80.91%; Reunion - arable land13.94%, permanent crops 1.59%, other 84.47% (2005)
Irrigated land:
total: 26,950 sq km;metropolitan France: 26,700 sq km (2008)
Total renewable water resources:
189 cu km (2005)
Freshwater withdrawal (domestic/industrial/agricultural):
total: 33.16 cu km/yr (16%/74%/10%)per capita: 548 cu m/yr (2000)
Natural hazards:
metropolitan France: flooding; avalanches; midwinter windstorms; drought; forest fires insouth near the Mediterranean
overseas departments: hurricanes (cyclones); flooding; volcanic activity (Guadeloupe,Martinique, Reunion)
Environment - current issues:
some forest damage from acid rain; air pollution from industrial and vehicle emissions;water pollution from urban wastes, agricultural runoff
Environment - international agreements:
party to: Air Pollution, Air Pollution-Nitrogen Oxides, Air Pollution-Persistent OrganicPollutants, Air Pollution-Sulfur 85, Air Pollution-Sulfur 94, Air Pollution-Volatile OrganicCompounds, Antarctic-Environmental Protocol, Antarctic-Marine Living Resources, AntarcticSeals, Antarctic Treaty, Biodiversity, Climate Change, Climate Change-Kyoto Protocol,
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Desertification, Endangered Species, Hazardous Wastes, Law of the Sea, Marine Dumping, MarineLife Conservation, Ozone Layer Protection, Ship Pollution, Tropical Timber 83, Tropical Timber94, Wetlands, Whaling
signed, but not ratified: none of the selected agreements
Geography - note:
largest West European nation
https://www.cia.gov/library/publications/the-world-factbook/geos/fr.html2. Forms of transportation and communication available in that (those)region(s)
Airports - with paved runways:
total: 297over 3,047 m: 142,438 to 3,047 m: 27
1,524 to 2,437 m: 98914 to 1,523 m: 83under 914 m: 76 (2010)
Airports - with unpaved runways:
total: 177914 to 1,523 m: 69under 914 m: 108 (2010)
Heliports:
1 (2010)
Pipelines:
gas 15,276 km; oil 2,939 km; refined products 5,084 km (2010)
Railways:
total: 29,640 kmcountry comparison to the world: 9standard gauge: 29,473 km 1.435-m gauge (15,361 km electrified)narrow gauge: 167 km 1.000-m gauge (63 km electrified) (2009)
Roadways:
total: 951,200 km (metropolitan France; includes 11,100 km of expressways)
country comparison to the world: 8note:there are another 5,100 km of roadways in overseas departments (2008)
Waterways:
metropolitan France: 8,501 km (1,621 km accessible to craft of 3,000 metric tons) (2010)country comparison to the world: 16
Merchant marine:
total: 167
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https://www.cia.gov/library/publications/the-world-factbook/geos/fr.html3. Consumer buying habitsWe have two main segments in our market :
The industrial (factories).The traders.Buying habitsThe consumer buying habits depend on his production plans so usually its a long term
contracts with huge quantities4. Distribution of the productTraditional distribution channels recommended .. Product sales by other middlemenTraders or middlemen will be useful in market penetration
5.Advertising and promotion. Sales promotions customarily used (sampling)
Only the sampling could be useful6. Pricing strategyWe will use our normal strategy as there is no need for change.Compare and contrast your product and the competitions product(s)
The competition could be divided into two main groups:The quality. Our product is in the second category of quality after the European product & after
it the Turkish on the 3rd grade then finally the AsianThe price. Our product & the Turkish are in the second category after the Asian products1. Competitors productThe following description ofcompetitors products (European ,Turkish & Asian )
a. Brand name
No sounded names in the yarn industry.b. FeaturesRegenerated color yarns From Ne. 3/1 to Ne. 12/1 , cotton / Polyester Blends from 70/30 to
50/50c. Package
country comparison to the world: 38by type: bulk carrier 2, cargo 8, chemical tanker 36, container 25, liquefied gas 12,
passenger 11, passenger/cargo 44, petroleum tanker 17, refrigerated cargo 1, roll on/roll off 11foreign-owned: 57 (Belgium 7, China 5, Denmark 12, French Polynesia 12, Germany 1,
New Caledonia 3, Norway 1, NZ 1, Singapore 3, Spain 1, Sweden 6, Switzerland 5)
registered in other countries: 146 (Bahamas 19, Belgium 5, Bermuda 1, Canada 1, Cyprus16, Egypt 1, Hong Kong 3, Indonesia 1, Italy 2, Luxembourg 16, Malta 13, Morocco 4,Netherlands 2, Norway 4, Panama 13, Saint Vincent and the Grenadines 2, Singapore 3, SouthKorea 1, Taiwan 1, UK 33, US 4, unknown 1) (2010)
Ports and terminals:
Calais, Dunkerque, Le Havre, Marseille, Nantes, Paris, Rouen
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Wooden Pallets / Plastic Bags.2. Competitors pricesEuropean products 20% higher. $3.00 to $2.50Turkish products same price. $2.50 to $2.50Asian products 20% less .$ 2.00 to $2.50
3. Competitors promotion and advertising methodsExhibitions are the Basic advertising methods & promotions only could happened in sampling4. Competitors distribution channelsDirect B2B sales + trading agents.C. Market sizeAccording to personal invistgations with our european agents we found that france is a good
potential for our product & there is a good chance to penetrate this market.*. Estimated sales for your company for the planning year720 Tons of YarnsD. Government participation in the marketplace* . Agencies that can help you
The French chamber of commerce
IV. Preliminary Marketing Plan
GuidelineThe marketing planOur plan to penetrate this market is to contact customer direct through our Marketing team +
finding out 2 agents , also we should increase our presence in the European textile exhibitions
A. Marketing objectives1. Expected sales 2012720 Tons.2. Profit expectations 2012$ 712,0003. Market penetration and coverageMarket Coverage is impossible but penetration is possibleB. Promotion mix
PromotionsOnly sampling
AdvertisingOnly Through exhibitions
D. Distribution: From origin to destination1. Port selectionFinal selection depends on customer preferences.a. Origin portAlexandria
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b. Destination portMarseille& Paris2. Mode selection: Advantages/disadvantages of each modeA. Ocean carriersMost of the European ports have The Same shipping cost
B. Motor carriersTruck available with the same prices we have in the European area
3. PackingWooden Pallets covered with stretcha. Marking and labeling regulationsThe standard required labeling for the global trade.b. ContainerizationGoods must be loaded carefully in a way which insure that the discharging of the container will
go without any problems with mechanical equipments .c. Costs
The normal cost will be enough & no need to add any additional costs.
4. Documentation requireda. Bill of ladingb. Commercial invoicec. Pro forma invoiced. Shippers export declaratione. Statement of originf. Euro 1 certificate
E. Channels of distribution (micro analysis)
Only agents are the available & required distribution channel.
1. Import/export agentsAgents useful for business introducing as they already have customers with previous business
relations & it will be easier to convince new buyers to try our products.Good agent could distribute at least 100 tons monthly .
F. Price determinationTo penetrate this market we dont have to change prices what we have to do is sending
industrial samples free of charge to the customers.1. Cost of the shipment of goodsFrom $ .10 to $.11 per Kg.2. Insurance costsAbout .005 % from the goods value.3. Customs dutiesDuty Free4. Companys gross margins
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$ 720,000 for the first year.
G.Terms of saleAlways the term of sales negotiable & we have to1. EX works, FOB, C&F, CIF
2. Advantages/disadvantages of eachAll the same For our product
H. Methods of paymentIn markets penetrations & new business LCs is the most preferred method of payment.1. Cash in advanceNot applicable2. Open accountsNot applicable.3. Sight, time, or date draftsNot applicable.
4. Letters of creditRequired & comfortable for all parties.
II. Pro forma financial statements and budgets
A. Marketing budget
Total needed budget $ 10,000
1. Advertising/promotion expenseAround $3,000 as a sampling cost.
2. Distribution expense
3% commission from the total sales
B. Pro forma annual profit and loss statement (first year and fifth year)
This data is confidential.
III. Resource requirements
A. FinancesNo finance needed.b. Production capacity11 tons daily.
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IV. Executive summary
From reviewing the country data we found that its a good potential market , we could compete
& penetrate this market for the following reasons :
We have the (Euro - 1) Agreement, thats mean that our product will be much cheaper thanother countries by 19.6% which is the VAT rate.We have the chance to convince a lot of buyer using the environmental approach as our
product is recycled & there is a strong demand on these products in Europe.The quality we will offer will be in the European acceptance zone.The faster delivery than the Asian competitors will give advantage to satisfy the customers.Also the distance gives us another advantage in the ocean freight rates.We have the same packing criteria as the European producers.Understanding the cultural background could give us the credibility needed to penetrate this
market.We dont have to change our pricing policy or make any modifications in our product .
The profit margins we will achieve from penetrating this market is reasonable comparing withthe cost of this penetration.
As France considered from the biggest fashion & textile countries its a big gain to put ourbusiness position with French companies in our company profile.