Avans University of Applied Sciences - International Business (and Management) - Year 3 Quarter 2 - IBO Project - Country Selection
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Course
Project (IBO)
Institution
Avans Hogeschool (Avans)
Bachelor International Business (and Management) Year 3 Quarter 2 project of Country Selection for De Koekfabriek. Need some inspiration for your project? By receiving a grade of 7.8 for this project, it will for sure help you with yours.
, 1920-Y3Q2-IBO-Project Business Expansion-Country Selection-Valerie Kuijpers-2128722
Business Expansion
COUNTRY SELECTION
De Koekfabriek
ll Executive summary
De Koekfabriek is a social enterprise selling cookies and coffee to accomplish their social mission.
With De Koekfabriek’s vision; ‘To create workplaces for people with poor job forecasts and provide
them skills for a workplace and a feeling of price.’, the company seeks to achieve their mission;
‘Open ten locations by 2021 in the Netherlands and generate 250-300 more jobs.’, by using their
strategy. A unique selling point of the company is being a social enterprise with a socially
responsible view. The shared values include; collaborating with healthcare organizations, providing
jobs to specific individuals, creating quality cookies. As the business strategy, De Koekfabriek
labels their bakeries as separate limited liabilities where the Holding keeps the rights of intellectual
property, meaning the bakeries are self-responsible for generating profit by establishing marketing,
sales, consumer demand and other. As part of the business strategy, De Koekfabriek collaborates
with health organizations. The organizations recruit and support the employees of the bakeries,
whereas De Koekfabriek provides part of their profit to the organizations to stimulate their care.
Furthermore, the company structure in the shops consist of a team of five, including a head baker,
a second baker, a location manager, a shop employee, and a cookie delivery person. Revenue is
generated through sales of six different types of cookies sold at the shopfront, to corporate
customers and online, where orders are received as well. To acquire materials De Koekfabriek has
one supplier for production materials and sources other from social enterprises. For expanding
abroad, De Koekfabriek seeks to spread their social mission, provide more jobs for individuals with
poor job forecasts, increase cookies sold and give higher profit to their partners. Moreover, after
analyzing De Koekfabriek with an internal scan strengths and weaknesses were found.
The Corporate Social Responsibility of the company to their employees is a strength, because it
distinguishes themselves from competitors in the cookie market. The collaboration with healthcare
organizations, moreover, is identified as a strength as well due to the contribution to care
improvements. Also, the production guarantees of De Koekfabriek is recognized as a strength,
therefore the company can build up relationship with customers. Firstly, a weakness of the cookie
company is the independency of the bakeries, it could case the overall company image to damage
if one underperforms. Secondly, the assortment of cookies for consumers is limited to six, which
causes to target a small segment of the total cookie market. Thirdly, the shop employees cannot
handle changes well, which restraints De Koekfabriek. For international expansion, at last, the
company must take CSR awareness, disposable income and healthcare quality into consideration
Valerie Kuijpers
2128722 – PG06
IBO Project Business Expansion
Mr. Peters
15-11-2019
for country comparison.
The biscuit industry includes the cookie market, with a value of 30.62 billion USD and expectation
to grow with 4.1% in the upcoming years. This market is dominating in Europe and North America.
1
, 1920-Y3Q2-IBO-Project Business Expansion-Country Selection-Valerie Kuijpers-2128722
Moreover, some factors of the micro and macro environment could affect De Koekfabriek. One
being increasing competition, since more corporations become socially responsible. Further,
consumer demand is changing towards healthier products, therefore sale of cookies could be
affected is demand decreases. Besides, the external scan demonstrated opportunities and threats
for De Koekfabriek. An opportunity is to spread their social mission abroad when expanding, so
more jobs are created for individuals with poor prospects. When operating internationally, the
opportunity could arise that De Koekfabriek gains more company and concept recognition. Also, if
more profit is generated by the shops, more could be sent to the health partners to improve care,
due to growing business. As a threat, if care in a country is not on the same level as in the
Netherlands, individuals might not be allowed to work for profitable social enterprises.
Furthermore, if the quality of the healthcare organizations is perceived well, collaborating could be
restraint and the concept of De Koekfabriek could be damaged. Lastly, increasing competition is
recognized as a threat, because an increasing number of companies become socially responsible,
that impacts the company. After all, specific company variables were formed based on the results
of the external scan. The opportunity variables include; cookie consumption, height on investment
needed for starting up bakeries and bakery facilities. On the upper hand, the identified risks are;
competitiveness in a country, tax rate for calculating the amount of tax corporations are required
to pay, and inflation rates to forecasts price changes and consumer demand.
The reason for De Koekfabriek to expand internationally is to spread their social mission and create
more jobs. Since the concept has already been successful in the Netherlands, the company should
maintain broad parts of the current business strategy and only make minor changes. The entry
mode De Koekfabriek will apply is a franchise strategy, including rights of intellectual property to
the Holding, shops labeled as separate limited liabilities and collaborations with local healthcare
organizations. The company structure for expansion should consist of a head baker, a second
baker, a location manager, a shop employee, and a supervisor, hereby division of roles is changed
for some. The assortment of cookies of De Koekfabriek will endure, however, the local manager is
allowed to add one or maximal two new recipes, which are locally popular to increase demand.
Additionally, the focus of the shop will be on their corporate customers and mostly operate
business-to-business. The shopfront will generate remain to spread the mission directly to
customers. Customer orders are received at the bakeries, instead of the head office and bakeries,
to simplify the ordering system and the orders will be processed in a local bakery facility. After a
weekly or monthly period, essential information will be sent to the head office regarding shop
developments. At last, the new De Koekfabriek bakeries should source from a local supplier for a
great part of raw ingredients, for other the company should source from social enterprises. For
selection the best country for expansion, different variables are used to compare selected countries
in a grid matrix.
The selection process is focuses on countries in Europe, since cultures in European countries are
comparable to the Dutch culture, where De Koekfabriek is success. The first category contains a
variable, researching is a country allows a corporation to operate with non-wholly ownerships of
intellectual property. The second category names variables being opportunities for De Koekfabriek.
One variable being the cookie consumption per country, measuring the consumed kilograms of
cookies per capita on a yearly basis. This results in, UK with the highest rate, followed by Italy and
France and Sweden. Another variable is healthcare quality, where the quality of healthcare
organizations is measured, since De Koekfabriek acts active in care of a country. Apparently,
Sweden and the UK have high quality healthcare systems, thereafter, come Spain and Germany.
CSR awareness is another opportunity variably, hereby the awareness of corporations and
consumers is measured, since the company is a social enterprise. Leaders in this respect are
Sweden, Switzerland and Norway, followed by UK and Germany. Also, an opportunity is disposable
income per capita, this is measured because De Koekfabriek sells price premium cookies.
Inhabitants in Denmark, Sweden and France have most to spend, afterwards come UK, Italy,
Norway and Spain. The last opportunity variable is the size of investment needed, measuring the
height of investment the company should spend to start operating in a country. In the UK
investments are the highest, France and Germany come next, whereas, Italy is the cheapest and
most favorable. The opposite of the opportunities are the risk variables. The first risk variable is
2
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