GrainCorp Company Analysis

This report provides an in-depth analysis of GrainCorp Company, a leading agribusiness enterprise in Australia. It covers the company's strategies, operations, and future recommendations for growth in the local and global market.

Running head: GRAINCORP COMPANY ANALYSIS
GRAINCORP COMPANY ANALYSIS
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1GRAINCORP COMPANY ANALYSIS
Executive Summary
The sector of Agribusiness in Australia is one of the most important pillars of industry of the
nation. Australia’s prosperity and wealth has been directly as well as indirectly connected to the
present condition and future condition of the Agribusiness sector of the nation. The respective
paper is a report of internal as well as external analysis of agribusinesses of Australia. The report
focuses on an agribusiness enterprise, namely, GrainCorp Company of Australia, introspecting,
analyzing and interpreting its strategies and modes of operations in details. The report also
provides future recommendations for the respective company for its growth and development in
the local as well as global market.

2GRAINCORP COMPANY ANALYSIS
Table of Contents
Executive Summary.....................................................................................................................................1
Introduction.................................................................................................................................................3
Discussion...................................................................................................................................................3
Overview of the Company.......................................................................................................................3
Objectives................................................................................................................................................4
Business Units.........................................................................................................................................4
Products and Services of the company....................................................................................................5
PEST Analysis of the company...............................................................................................................5
International Strategies............................................................................................................................7
Mode of Entry of the Company...............................................................................................................8
Recommendation.........................................................................................................................................9
Conclusion.................................................................................................................................................10

3GRAINCORP COMPANY ANALYSIS
Introduction
The sector of Agribusiness in Australia is one of the most important pillars of industry of
the nation. Australia’s prosperity and wealth has been directly as well as indirectly connected to
the present condition and future condition of the Agribusiness sector of the nation. A plethora of
local as well as global market places have been putting their attention into the respective sector.
The agribusiness arena of Australia, with the growing consumer consumption behavior all
around the world, has been changing unprecedentedly (Moshin 2015). Therefore, the
agribusiness sector of the nation is important to learn and comprehend. The respective paper is a
report of internal as well as external analysis of agribusinesses of Australia. The report focuses
on an agribusiness enterprise, namely, GrainCorp Company of Australia, introspecting,
analyzing and interpreting its strategies and modes of operations in details. The report also
provides future recommendations for the respective company for its growth and development in
the local as well as global market.
Discussion
Overview of the Company
The company GrainCorp limited is a company that comes under the public sector of
Australia. The core business tasks of the company are receiving and storage of grain and other
related commodities in their warehouses (Graincorp.com.au.2019). The company also provides
logistic support as well as helps in marketing those grains and food products that have been
stored in its warehouses. The company has been listed in the Australian Securities Exchange,

4GRAINCORP COMPANY ANALYSIS
having its headquarters at Sydney, Australia. The company has negotiated and came to an
agreement with United Malt Holdings group of companies and has expanded its operations in
North America since 2009.
Objectives
The vision of GrainCorp limited company is to become a leading international
agribusiness and as a reliable partner for the international customers of the company. The core
values of GrainCorp limited are that the company is committed to safety and health of their
employees, contractors, visitors and community. The company has taken up the principles of “no
harm” and proactively manages heath, safety and environmental risks and also recognizes that
individual safety is the most important step for the organization in achieving goals. The company
is highly customer centric in its approach and code of conduct in the market. The company
works relentlessly for a perfect and maximum customer experience and satisfaction. The
company GrainCorp pursues excellence, is an innovation enthusiast, considers variety of
perspective when it comes to take decisions and strategies regarding their operations and and
works in order to develop a sustainable performance with courage to accept and adjust with
changes, thereby, learning to develop with the help of their mistakes and lessons.
Business Units
The GrainCorp Company undertakes the duties and responsibilities of proper production
of different grains, oils and malts at various parts of Australia into a larger extent. Through its
extensive operations, GrainCorp Company has been able to gain competitive advantage against
the other competitors in the local as well as global agribusiness market. The company not only
functions in Australian market, but also in international markets as well. The GrainCorp limited

5GRAINCORP COMPANY ANALYSIS
company has been considered to be one of the best performance driven agribusiness company in
Australia.
Products and Services of the company
The products that are produced by the company GrainCorp limited are grains, oil and
malt which are also exported from the company along with the logistics support and marketing
segmentation and support that are being provided by the company itself. The company
GrainCorp offers a wide range of specialist fats and oils which are utilized to meet the requisites
of food manufacturers, bakers and caterers to a large extent all over Australia and New Zealand.
GrainCorps is considered to be the largest refiner of edible oils and fats in the nation of Australia
and New Zealand with capacity of 280000 tons of products every year. It also produces infant
special oil blends for infant nutrition. The company has a strong supply chain management
service that provides logistics support and supply along with marketing support for the products
as well (Graincorp.com.au.2019).
PEST Analysis of the company
In order to understand the international opportunities of the company GrainCorp limited, a
PESTLE Analysis has been provided hereafter.
Political Aspect: GraincCorp limited has been operating in the field of food, beverages and other
food products in different countries; therefore, it is exposed to different types of political
conditions. In order to gain success in this field, the company needs to revisit and diversify the
systematic risks of political environment. Level of corruption, military invasion are certain
factors that has to be kept in mind before plunging into aggressive business.

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Economic aspect: To operate internationally, in dozens of countries with various economic
conditions and policies, GrainCorp limited has to comprehend and understand certain factors,
such as types of economic system in the countries where it is operating, government intervention
in the free market related goods, exchange rates and stability of host country currency,
comparative advantages of the host countries where it is operating in the sector of food, inflation
and interest rate of the respective country where it is operating.
Social aspect: It has apparently been researched and found out that the culture of the society
affects the culture of the organization as a whole. Since GrainCorp is functioning internationally,
or rather, globally, therefore, it operates in nations which possess different social backgrounds.
In order to operate internationally, cultural aspects such as demographic composition and skills
possessed by the demography in a particular nation where it is operating should be noted down.
Class structure, hierarchy and power structure of the particular society, leisure interests and
attitudes towards health and environmental consciousness must be kept in notice while
formulating corporate responsibility strategies and other policies.
Technological aspects: As an international firm, GrainCorp limited is considered to research ana
analyze the technological factors in the different countries it is about to operate or is functional,
the technological advancements of the respective countries and technological progression among
the international peers of the firm as well. Recent technological development and rate of
technological diffusion on the basis of international platforms are certain factors that are needed
to be checked and constantly revisited by the firm in order to operate successfully in an
international basis.

7GRAINCORP COMPANY ANALYSIS
International Strategies
The international strategies taken up by GrainCorp limited company in order to survive
and thrive in the fierce competitive local as well as global market are provided hereafter. The
strategy the respective company has taken up in order to drive shareholder value are delivering
on strategic growth initiatives which would facilitate growth and diversification of earnings and
cash flow with an expectation of stronger returns from their investment. The core strategies of
GrainCorp limited company are pursuing growth opportunities, delivering a prolific return to
their own capital investment, expanding their grain origination footprint and improving their
efficiency within as well as outside the organization (Graincorp.com.au.2019).
In October 2016, the company GrainCorp limited constructed almost 200 elevators and
an export terminal to connect the grains of New South Wales to the world which signified that
the company had planned to operate internationally and had also implemented the plans
(Worldgrain.com.2016). The diversification strategy of GrainCorp limited company has played
the role of an extremely significant support unit in case of company’s underlying performance
with all the other business units, except for GrainCorp oils. The diversification strategy carried
out by the company has one of the most customary objectives, which is, reaching with its
products and services to as many customers as they can and also reach the international
customers. In order to deliver their strategic growth initiatives successfully, the company has
taken certain policies and schemes, such as, focusing on successful implementation of the growth
projects taken up by the company. Certain growth projects that have been taken up by the
company are Edible Oils Network Optimization that had been taken up by the Australian head
branch, Bulk liquid storage capacity expansion that has been taken up by their franchise in
Brisbane, Reshaping of country network, and 50- 50 JV in Canada as a marketing strategy. One

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of the corporate objectives of the company which are aligned with shareholder interests is
managing variability. Variability in supply chain management can be clearly defined as
measurement of how much variability can occur in the demand for customers. In other words, it
can approximately be stated that the measurement is the variability between what is expected to
happen and what really happens in the market when a product is newly introduced and supplied.
The measurement is important because before a particular product or a service enters into the
market, theoretical speculations are done in order to understand the trend. When the product or
service gets launched in the market, the pragmatic market behavior is then determined by
observation and calculation. Therefore, to carry out business of supply chain management, such
initiatives are indeed necessary.
Mode of Entry of the Company
There are six kinds of Mode of Entry of a firm in the international market or business arena that
are defined hereafter.
Firstly, Selling on the internet: Marketing with the help of internet is considered to be the
fastest and the easiest way to enter into the international market as internet itself is a global
portal which allows any individual or collective group to propagate and practice all kinds of
activities. Secondly, Export: A firm, which aspires to operate internationally, should begin
exporting its goods and services to the foreign countries to directly come in contact with the
foreign markets and their whereabouts. Thirdly, Franchising and licensing: with the help of
franchising and licensing systems, a firm can assure its identity in a foreign land without having
the fear of any kind of casualties or inconvenience. Franchising allows a business entity to pay
the respective firm for the usage of their names or patent trademarks, which is the best way of
entering into the market. Fourthly, Joint Venture: Joint venture of a particular firm with a

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foreign firm allows each other to share their risks as well as rewards, thereby, making it easier
for a particular firm to enter and operate internationally or globally up to certain extent. Fifthly,
acquiring foreign companies; By purchasing a foreign company, which is indeed an expensive
process, a firm can enter into international market, Sixthly, by following Porter’s diamond model
theory of national advantage where the company can select a country where they would be
possessing international competitive advantage and would have an opportunity to thrive their
business in the respective country(Forsgren and Johanson 2014).
The respective Ausralian agribusiness firm GrainCorp limited can has a brilliant
opportunity to enter into the international market. It can successfully enter, survive and thrive in
the international market with the help of internet. Aggressive campaigning of the export of the
products and services respective firm regarding their products and services through effective
digital marketing and search engine optimization techniques can help the firm harness benefits of
entering into the international market. With the usage of Porter’s diamond model theory, the
company can research and understand which nation would be risky for them and which one is
not. Based on the analysis, they might carry on their export tasks taking the aid of digital portals
in the specified country, Germany. Porter’s diamond model theory include firm strategies,
structures and rivalries, demand conditions, factor conditions and related support industries that
can be taken into account while analysis.
Firm strategy, structure and rivalry: it consists of concentration of market power, degree of
competition and ability of rival firms to enter into the market. Germany is known for its
technological research, development and advancement (Shin 2013). Therefore, with the help of
innovative strategies in technological sphere, GrainCorp can increase its credibility if it places its
business in Germany.

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Related supporting industries: related supporting industries are the suppliers and customers,
upstream and downstream industries that can be threat as well as opportunity to GrainCorp.
Germany is known for its horticultural industries and products (Rombach and Bitsch 2015).
GrainCorp company, which is an agribusiness company, might find itself comfortable as an
agribusiness in the arena of horticulture with comparatively less dangerous peers and competitors
(Luhmann, Schaper and Theuvsen 2016).
Demand conditions: demand conditions include size and nature of customer base of products.
The demand of agribusiness products in Germany varies from one region to the other. The
German consumers are prolific and can be influenced as they are flexible and experimental
(Smith et al. 2013). Therefore, GrainCorp can gain advantage for setting up their business in the
flexible areas of Germany.
Factor conditions: Factor conditions include large pool of skilled and unskilled labor,
technological innovation, infrastructure and capital. Germany is known for abundance of
workers with strong and prolific engineering and other professional skills with a strong base in
capital (Rinne and Zimmermann 2013). Therefore, GrainCorp has opportunities to gain profit in
placing its business in Germany.
GrainCorp limited can also fall in problems for its inappropriate entry into the
international market. GrainCorp is has been recommended to avoid Joint Venture while trying to
enter into the arena of international business because there are certain limitations in joint venture,
such as clash in different objectives, insufficient leadership and poor integration and cooperation
in management and culture (Kraus et al. 2015). Joint venture might be proven to be a huge risk in
terms of finances and resources, therefore, the company is recommended not to apply it.

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Recommendation
From the overall strategic analysis as well as PEST analysis of the company GrainCorp limited
provided in the paper, strategic recommendations based on the analysis of the company are given
hereafter.
1. More expansion of market and product/services technique with the help of internet and
digital assistance portals and platforms are needed to be carried out by the company in
order to be more competitive.
2. Various innovative techniques in the usage of technologies and other facilities should be
carried out inside as well as outside the organization in order to improve itself as a
company.
Conclusion
The respective paper is a report that concludes with internal as well as external analysis
of agribusinesses of Australia. The report focuses on an agribusiness enterprise, namely,
GrainCorp Company of Australia, introspecting, analyzing and interpreting its strategies and
modes of operations in details. The report also concludes by providing future recommendations
for the respective company for its growth and development in the local as well as global market.

12GRAINCORP COMPANY ANALYSIS
References:
Forsgren, M. and Johanson, J., 2014. Managing networks in international business. Routledge.
Graincorp.com.au.2019. Available at: http://www.graincorp.com.au/about-graincorp
Graincorp.com.au.2019. Available at: http://www.graincorp.com.au/investors-and-media/
Kraus, S., Ambos, T.C., Eggers, F. and Cesinger, B., 2015. Distance and perceptions of risk in
internationalization decisions. Journal of Business Research, 68(7), pp.1501-1505.
Luhmann, H., Schaper, C. and Theuvsen, L., 2016. Future-oriented dairy farmers’ willingness to
participate in a sustainability standard: evidence from an empirical study in Germany.
International Journal on Food System Dynamics, 7(3), pp.243-257.
Moshin, M., 2015. Agribusiness financing in Australia: issues and research agenda. International
Journal of Economics and Finance, 7(7), pp.1-18.
Rinne, U. and Zimmermann, K.F., 2013. Is Germany the north star of labor market policy?. IMF
Economic Review, 61(4), pp.702-729.
Rombach, M. and Bitsch, V., 2015. Food movements in Germany: slow food, food sharing, and
dumpster diving. International Food and Agribusiness Management Review, 18(1030-2016-
83042), p.1.
Shin, J.S., 2013. The Economics of the Latecomers: Catching-up, technology transfer and
institutions in Germany, Japan and South Korea. Routledge.

13GRAINCORP COMPANY ANALYSIS
Smith, R., Deitz, G., Royne, M.B., Hansen, J.D., Grünhagen, M. and Witte, C., 2013. Cross-
cultural examination of online shopping behavior: A comparison of Norway, Germany, and the
United States. Journal of Business Research, 66(3), pp.328-335.
Worldgrain.com.2016. Available at https://www.world-grain.com/articles/7302-graincorp-
relying-on-its-integrated-supply-chain