Business Environment and Strategic Management in Australian Agribusiness

This report sheds light on the business environment and strategic management of Australian agribusiness, with a focus on The Australian Agricultural Company. Suitable international strategies, modes of entry, and future strategic directions are discussed.

Running head: BUSINESS ENVIRONMENT AND STRATEGIC MANAGEMENT
BUSINESS ENVIRONMENT AND STRATEGIC MANAGEMENT
Name of the Student
Name of the University
Author Note

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Executive Summary
The report has shed light on the business environment and strategic management of
Australian agribusiness. The capitalisation of economic advancement and getting benefits
from the international market is the key concern of that business. The Australian agricultural
company has taken some effective strategies in opportunities and market expansion. The
business will expand in UK and allocation of different procedure and their target market and
business opportunities are discussed in this report. Australia’s strategic location and
entrenched trade relations valued depositors pursuing to admittance fast-growing
marketplaces from a steady base.

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Table of Contents
Introduction................................................................................................................................3
Overview of Agribusiness sector in Australia...........................................................................3
International opportunities for ‘The Australian Agricultural Company’...................................4
Suitable international strategies for ‘The Australian Agricultural Company’...........................5
Appropriate and inappropriate mode of entry in international market......................................6
The future strategic direction of the company in international business expansion..................8
Conclusion..................................................................................................................................9
References................................................................................................................................11

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Introduction
Agribusiness is one of the strongest pillars of the Australian economy. The global
market demand for Australian agribusiness is high and most of the people find a good source
of income through this process. The growing potential of the agribusiness is making
communal sanguinity to expose in new marketplaces, generate occupations and advance in
new technologies. Most of the middle-class people are engaged with the food and agriculture
process in Australia and government initiation is also there for the development of current
market in agribusiness (Kiem and Austin 2013). There are some latest technologies
introduced in this field and that encourage the 12th largest economy in the world. In Asia, this
is the 5th largest economy in the Asian region and agricultural aspect is crucial in that case.
Australian GDP is $1.3 trillion and agribusiness has made enough contribution over
this. There are different reasons for that Australia has been chosen as one of the developed
countries to continue the business. Strong economy and support from the government help
the entire agribusiness in Australia. They have already selected some strategic location and
world-class research and development adoption that helps in the improved development of
the organisation.
Overview of Agribusiness sector in Australia
The agribusiness sector is very dynamic indeed and they reconfigure their supply
chain for ethnically and culturally strong industry. Australia has good large scale farming
opportunities and the land has got proper rainfall, water, and atmosphere. The agricultural
infrastructure of the nation is good and innovative touch is also there. Healthy supervisory
protection with reliable values in isolation, food security and food classification are there and
that makes the sector relevant and important for the country.

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The Australian agricultural company is one of the largest companies in terms of
operation as the company was started in 1824 so a long experience of the company persists.
Headquarter of the company is in Bowen Hills Australia (Aaco.com.au 2018). The main
focus of the company is the production of Beef, Wagyu, and Takumi. The company also
offers wheat, irrigated cotton, chickpeas in the market. The agribusiness standard has been
maintained and managed through the productivity and revenue generation.
International opportunities for ‘The Australian Agricultural Company’
The international opportunity for The Australian Agricultural Company is huge as the
experience of the company and their market reading capacity maintain a balance. The
domestic market establishment is a sign of good performance. The export processes are
strong and strong foundation in the organisation helps the process to motivate them in core
international activities. The export-market-expansion activities are developing a strong
foundation, and the UK provides that opportunity to range their products (Tan and Lester
2012). In case of addressing UK market, planning is needed with the proper financial,
economic, and legal aspects. A well deserves marketing plan encourage potential marketing
for the company and they have a good business acceleration in international arena.
International market research needs some planning activities for entering into the new
market. The UK has good business opportunities in that case. Initial export sales are also
important in case of developing the market. That enables practical experience in the market.
The path of export the success and make some necessary changes in documentation,
distribution, transportation and collection helps to find a good customer group (Mathews et
al. 2016). The regulations of the revised planning are significant and that engross in
monitoring process of international marketing. The Australian Agricultural Company is
committed to advance environmental management which guards the capitals on which our
production systems are based. Thus investment aboard process adjacent the market and set

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some effective marketing strategy for the development of the business. The research and
development approach of the company help this business to run in the long-term process
(Lindgreen and Hingley 2012). The innovative product meeting helps to understand the target
market and the UK have a segmented market, those love to have beef and their recipes, thus
better business opportunities in the international market of UK persists.
Suitable international strategies for ‘The Australian Agricultural Company’
There are three major international strategies that companies have taken like Multi-
domestic, Global and Transnational. Each strategy has different responses and it depends on
the market condition and customer preferences.
Multi-domestic detriments competence in favour of highlighting receptiveness to
local supplies within each of its marketplaces. Local preferences are the key approach in
strategy and companies will serve their service or product as the people love to have those.
Survey process determines the choice of native people and the target market is being set
afterwards (Banson et al. 2015). UK people like to have more sausage with beef, and beef
International
Strategies
Multi-domestic
Strategy
Global Strategy
Transnational
Strategy

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with different ingredients also make the recipe different. So people taste will encourage the
company to change the taste and also change in the international market.
On the other hand, the Global strategy is completely opposite of the multi-domestic
strategy. This is the process that ensures the same product or service quality in the parental
market. The success rate of that kind of service or product is good in the previous market so,
in case of international penetration of product and service, companies are not willing to
change the process (Jie, Parton and Cox 2013). Products can be modified a little to gain some
economic advantages but the product and service will remain the same at most of the markets
in the international arena. In the case of consumer good products brand modification and
target customer view can allow a nominal change in business but most of the times local
preferences are not considered in global strategy. In the case of, The Australian Agricultural
Company has some beef products that they need not change wherever they go for their
business expansion. These products have come under the global strategy in business.
The last strategy that companies can avail for their market enhancement is to maintain
a balance between global and multi-domestic, which means the approach of both the
strategies are persist in this mixture. There are some cases where the recipe or item name is
the same from the same brand but some of the core ingredients are adjusted due to the taste of
the international nation. This is the safe process of maintaining both administrative control
over the brand and make necessary changes in international market (Schroeder and Tonsor
2012). It is astonishing to note that in the attendance of such an important agribusiness
speculation chance, Australia is viewing a complete deteriorating level of venture related to
GDP, alike to other OECD nations such like US and UK. The process of maintaining both the
parts will help in strategic innovation that The Australian Agricultural Company wants to
form the international market.

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Appropriate and inappropriate mode of entry in international market
The economic reform in Australia has happened in 1960 and there are different
policies that companies are adopted for their reformation of organisation culture and
development. The economic infrastructure and population growth in Australia help business
opportunities also. The Australian Agricultural Company takes advantage and serve more
than millions of people in the nation and now in international arena. However, the process of
making move in other nations is not that easy as there are some specific policies used by the
nations so as the legislative changes for business acceleration (Felzensztein et al. 2014). So,
modes of entry, in that case, are important and relevant for the company.
There are different modes of entry in the international market. Strategic alliances,
Joint ventures, Exporting, Outsourcing, Franchising, and Foreign direct investment along
with Merger and acquisition processes of business expansion is there.
The strategic alliance is a relationship with the marketing process of the company
with international market. The distribution alliance and marketing agreements are there in
that case. Joint ventures process is a sharing ownership and management with another
company and they are directed in the same objectives in international operation (El-Gohary
2012).
The foreign market entry is suitable in the case and risk and rewards are also shared in
this case. This is a good entry process to collaborate with any other food industries in the UK
and stable the business initially.
Outsourcing product is another appropriate mode of business acceleration. The mode
reduces the cost and transfer the work portion outside from suppliers and completes it
internally. The domestic and foreign contracting is good in that case and good swiftness in
work persist in that case.

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The form of semi-independent business is also useful in case of the mode in entry.
The process is considered as Franchising. Owners of those small business pay fees and
royalty to the head company and in return, they sell product and services of the parental
company with the same logo or brand name (Sandhu, Nidumolu and Sandhu 2012). As this is
very small initiate to expand the business, thus internationally this is a good step to enter. It
needs small investment and less risk persists in that case.
In case of the inappropriate mode of entry foreign direct investment is not suitable in
case of marketing in the UK. The pattern of the economy of that particular country helps the
process. But this is the depending process of bestowing over the different economy. The
economic allowanced of that country is the crucial aspect and that is the reason purchasing
shares of the company along with the property and assets are subjected to the government.
Though this is an easy way to enter the market but the government policies are not helpful in
all the times (Sandhu, Nidumolu and Sandhu 2012). The return on investment is very low in
that case so this is one of the risk-taking processes to enter in the UK.
The process of merger and acquisition in two or more district entities in one section
accumulate the assets and distinct entities. The tax benefit process and fast growth of
diversification is the key benefit from this process but the share market flow in business helps
the entire scale of merging and servicing entity is the key confrontation in that case. Some of
the native companies are not willing to work and that considered a loss for the penetrating
company.
The future strategic direction of the company in international business expansion
The strategic direction of The Australian Agricultural Company moves their business
process in brand recognition and wants to maintain a good customer partnership with global
capabilities. As per the FY17, the company enters and sells their products in USA, South

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Korea, and Japan along with native Australia. Hence, they have a good sense of the market in
the international arena presents in this market (Felzensztein et al. 2014). In case strategic food
selection luxury branded beef from the highest quality cattle products are chosen by the
company. There is some future strategic implementation that airmailed through the company
for the development of delivering results.
 Brand exclusivity and investment of larger amount to showcase the establishment of
the company to the world.
 Better control in products and deliver good food through experienced chef and
nutritionists.
 The brand driven pricing process is significant for the changes in global business
aspect. Branding is driven by the marketing and promotion and as much as people
know about the service or product, output or result will come through the process.
 There is some successful mode of entry for the company and in most of the cases, the
operation in joint business planning supports supply chain optimisation.
 4% increase in cattle inventory will help to maintain the resource and this 4% will
gear up to the 15.6% increase after two years (Felzensztein et al. 2014).
These future recommended process delivers the improvement of efficiency of the
company and to advance the capital and focus on operational control of the company.
Agricultural economists have contradicted with the estimation that hazards and reservations
also happen in approximately every supplementary scheme, contingent on the nature of the
business, which obligation and impartiality capital contractors are enthusiastic to income
through the process.

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Conclusion
Therefore it can be concluded that agribusiness in Australia has the good opportunity
and employment, expenditure, exports and turnover of the business is huge. The Australian
Agricultural Company has a good future indeed as they have good business experience and
they serve high-quality beef to their customers. There is some unprocessed range of beef and
through the company, people enjoyed this. The experiential indication has yet to confirm
which intuitional funding arrangement, market-based, bank-based or cross system, will
unsurpassably aid the expanded requirements of the agribusiness business in Australia.

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References
Aaco.com.au 2018 The Australian agricultural company retrieved from:
https://aaco.com.au/about-us [Accessed on 12th October, 2018]
Banson, K.E., Nguyen, N.C., Bosch, O.J. and Nguyen, T.V., 2015. A systems thinking
approach to address the complexity of agribusiness for sustainable development in Africa: a
case study in Ghana. Systems Research and Behavioral Science, 32(6), pp.672-688.
El-Gohary, H., 2012. Factors affecting E-Marketing adoption and implementation in tourism
firms: An empirical investigation of Egyptian small tourism organisations. Tourism
management, 33(5), pp.1256-1269.
Felzensztein, C., Stringer, C., Benson-Rea, M. and Freeman, S., 2014. International
marketing strategies in industrial clusters: Insights from the Southern Hemisphere. Journal of
Business Research, 67(5), pp.837-846.
Jie, F., Parton, K.A. and Cox, R.J., 2013. Linking supply chain practices to competitive
advantage: An example from Australian agribusiness. British Food Journal, 115(7), pp.1003-
1024.
Kiem, A.S. and Austin, E.K., 2013. Drought and the future of rural communities:
opportunities and challenges for climate change adaptation in regional Victoria,
Australia. Global Environmental Change, 23(5), pp.1307-1316.
Lindgreen, A. and Hingley, M.K. eds., 2012. The new cultures of food: marketing
opportunities from ethnic, religious and cultural diversity. Gower Publishing, Ltd..
Mathews, S., Bianchi, C., Perks, K.J., Healy, M. and Wickramasekera, R., 2016. Internet
marketing capabilities and international market growth. International Business Review, 25(4),
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Sandhu, H., Nidumolu, U. and Sandhu, S., 2012. Assessing risks and opportunities arising
from ecosystem change in primary industries using ecosystem-based business risk analysis
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Schroeder, T.C. and Tonsor, G.T., 2012. International cattle ID and traceability: Competitive
implications for the US. Food Policy, 37(1), pp.31-40.
Tan, Y. and Lester, L.H., 2012. Labour market and economic impacts of international
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