International Business Plan

This study focuses on developing a comprehensive international business plan for Sanitarium Health and Wellbeing Company's expansion to India. The plan includes analysis of the company's background, implications of SWOT analysis, competitive strategy analysis, market entry options, and research and development considerations.

Running head: INTERNATIONAL BUSINESS PLAN
INTERNATIONAL BUSINESS PLAN
Name of the Student
Name of the University
Author Note

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Executive Summary
The study is focused towards providing a further important analysis of the company Sanatariam
and its business prospects in India. Sanatariam is an Australian health food company that is
engaged in the provision of healthy food and beverages to the people. It is styled as a non-profit
organization. The company provides wide number of products that include Weet-Bix cereals, Up
& Go liquid beverages, dairy products and products like peanut butter. It wants to expand its
products to the market of India. The country was found to have a significant market potential.
Sanatariam has religious inclinations and is associated with the Australian Seventh Day
Adventist Church. The church was actually established the organization. This was to channelize
the provision of health products for the well-being of the people. The products are mostly made
from plants and are healthier substitutes to many of the similar products available in the market.
In India, Sanatariums reputations as a company that provides breakfast products and beverages
and milk products would have a strong market. It was found that Indians love all cuisines as well
as beverages. India has a culture of eating nutritious breakfasts. The Indian public were found to
be very fond of breakfast delicacies. There are people of diverse cultural inclinations in India.
Economically india is a large business hub. Additionally, Indian economy is one of the most
progressive in Asia and the world. India has one of the most increasing potentials for business
growth. The rate of GDP growth in India is around 7%. Hence, it can be said that India has great
market potential. There is good potential in the country for other businesses. The large
population of the country can ensure that the organization is able to reap ample profit from the
market even in the initial phases. There are the availability of other businesses that can
complement the business of the company. The important entry point was found to be local

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partnership. Providing Indian public customized products were found to be important for gaining
essential competitive advantage.

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Table of Contents
Introduction......................................................................................................................................4
Background of company and International country........................................................................4
Implications of SWOT Analysis......................................................................................................6
Additional Analysis.........................................................................................................................7
Competitive Strategy Analysis........................................................................................................8
Market entry option Analysis..........................................................................................................9
-Preferred option recommendations............................................................................................9
Research and development considerations....................................................................................10
Production Recommendations.......................................................................................................10
International HRM Issues..............................................................................................................11
Conclusions....................................................................................................................................12
References......................................................................................................................................13

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Introduction
The study is focused towards further developing upon the comprehensive international
business plan for the organization Sanitarium Health and Wellbeing Company of Australia. The
company wants to expand internationally to the markets of India. The various aspects that have
been discussed in the previous assignment would be further analyzed to develop more
comprehensive and effective strategies. Sanitarium is a company that engages in delivery of high
quality beverage and dairy products to the customers. The organization works on the principles
of a not for profit organization. This is because the owner wants to provide quality foods to the
customers that improve their health and fitness. The company provides wide number of products
that include Weet-Bix cereals, Up & Go liquid beverages, dairy products and products like
peanut butter. The company wants to expand its products to the market of India. The prevalent
market conditions are very much different in India compared with that of Australia. The focus
would be towards understanding the findings from the previous plans in better ways and forming
better strategies through deeper evaluation of the same. The strategies thus formed can help the
organization to gain better advantage in the market of India. The study is focused not only
towards discussing the findings but also towards analyzing and improving upon them as and
when possible.
Background of company and International country
The Sanitarium health Food Company was established in 1898. It is a company that has a
long history in the industry. The most important focus of Sanitarium has been towards providing
the people of Australia with a wide range of healthy beverages as well as vegetables. It was
found previously that the organization operates in the Health industry. The company has

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religious inclinations and is associated with the Australian Seventh Day Adventist Church. The
church was actually established the organization (Sanitarium Health Food Company Australia,
2019). This was to channelize the provision of health products for the well-being of the people.
The products are mostly made from plants and are healthier substitutes to many of the similar
products available in the market. It is part of the belief of the Church that dietary regimens that
are made from plants actually have the capacity to enhance the multifaceted health factors of
people. Sanitarium has hence created their brands to work in accordance with the belief of the
Church. The organization is charitable in its work and focuses on providing maximum quality
products to the customers without charging more. This is what was found to be an interesting
part about the Brand. The company is established as a charitable not-for-profit organization with
welfare oriented organizational outlook. It is important for the company to provide service to the
customers in the form of health products that can help them lead healthier lives. Some of the
most important products that are offered by the company are Weet-Bix, the gluten free cereals;
Up & Go, a series of healthy liquid beverages that are focused on the Australian people, Dairy
products made from organic and pure milk; spreads that mostly include peanut butter which is
another Australian favorite.
The market that has been chosen for the expansion of the company is India. The current
operating market of Sanataruim is only in the various provinces of Australia (Sanitarium Health
Food Company Australia, 2019). The company now wants to move operations to India for
various reasons. The company’s market portfolio is well established, which will give it an
advantage while entering the market of India. In India, Sanatariums reputation as a company that
provides healthy breakfast products and beverages and milk products would have a strong
market. India is the largest South Asian Country with the world’s second largest population. It

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was found that Indians love all cuisines as well as beverages. India has a culture of eating
nutritious breakfasts. The Indian public were found to be very fond of breakfast delicacies. There
are people of diverse cultural inclinations in India. Economically india is a large business hub.
Additionally, Indian economy is one of the most progressive in Asia and the world. India has one
of the most increasing potentials for business growth. The rate of GDP growth in India is around
7%. Hence, it can be said that India has great market potential. There is good potential in the
country for other businesses. The large population of the country can ensure that the organization
is able to reap ample profit from the market even in the initial phases (Paul & Mas 2016). There
are the availability of other businesses that can complement the business of the company.
Politically the country is focused on creating better environments for the foreign businesses.
Socially, the upper and the upper middle classes would be attracted to the product.
Implications of SWOT Analysis
The SWOT analysis of Sanatariam brought to light some of the important external and
internal factors that can affect the business. The implications generated from analysis of these
factors can create scope for better strategy formation for the future endeavors of the company.
The strengths of the company were found to be high-quality product value, skilled workforce and
tax-exempt status. All three can improve the productivity of the company. The high quality of
product can ensure good demand. The huge employee base can ensure that the company would
have optimal production capability. The tax-exempt status ensures that the cost of production
remains low. The weaknesses that were however identified were, limited market penetration and
separation of the branches of New Zealand and Australia. This is a problem if the expansion is
considered as low penetration also means low experience in the market which can later cost the
company. The separation of the branches can cause significant difficulty while operating.

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The opportunities were found to be considerable expansion potential and exploitation of
global untapped market. The global niche health market is not yet discovered but has tremendous
growth potential. Moreover investment potential was also found that can help the company to
take in more monetary benefit in the long term. Investment value was found to be profitable in
the long run. This means that the growing niche market has a very good growth potential and can
be utilized for gaining further future growth. Likewise it was also found that engaging in charity
as per its normal operational process can ensure far better reach. However, at the same time
significant threats were found like growing competition, increased hostile competitive situation
and similar factors. The operational procedures of the company can come under threat from the
larger competitors than can try to outrun the product offerings of the company. It is important to
remember that that the company has to keep in line with its product value while focusing on
gaining more customer base. Especially, this has to be the operational procedure that is utilized
in the new market.
Additional Analysis
India as the focus country is growing in market potential. The market evaluation revealed
that the country provides good business opportunity to the new foreign organizations that are
coming to the country with newer products. It can be said that the market for the products that
are manufactured by the company Sanatarium has increased significantly in India. In the recent
years there has been the growth of the educated and informed upper middle class of India. This
can be an essential target market. This customer segment is usually not happy with the product
offerings that are present in India. This group is focused towards more hygienic and organic
food. Hence, this growing population of upper middle class urban and suburban families can be
targeted to gain higher growth. The market potential of Sanatarium can also increase. Especially,

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the demand for dairy products and beverages are very high in India. There has also been the
growth of supermarket in Urban, Sub-urban and even small townships of India (Paul & Mas
2016). The company can utilize these centers for gaining even better penetration for their product
in the country. It is important however to keep a track of the local firms as they would be the
largest competitors of the company.
Competitive Strategy Analysis
The competitive strategy of the company as of now is the provision of herbal optimized
and organic food and beverages. This strategy is likely to work in India as far as the product
provision is concerned. In the market there is significant concern about the product that are to be
provided. There are a large number of synthetically optimized and artificial products. This leads
to the rise of speculation among the customers concerning the authenticity and effectiveness of
these products. There is high demand for organically enhanced natural and healthy products.
This is especially among the higher and middle income groups of the country. The urban and
suburban middle income customer segment is usually not happy with the product offerings that
are present in India. This group is focused towards more hygienic and organic food. Hence, this
growing population of upper middle class urban and suburban families can be targeted to gain
higher growth. The product strategy should be kept simple and effective by the company. The
demand for organic product is due to rise in the future in the country. However, the supply has to
be sourced from the Indian markets. India has a significantly large agricultural and dairy farm
base that can be used to optimize the product as per the Indian standards. The packaging needs to
be done in a way that depicts the organic and healthy aspects of the product. There is high
demand for health oriented products in the country that can be utilized properly for greater
benefit.

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Market entry option Analysis
The best market entry option initially would be to partner with an established Indian firm.
Partnering becomes a necessary action when a completely new business tries to enter a new
market. Franchising can also be implemented in the country. There are many food and restaurant
joints that have taken the franchising option to open their shops in India. Joint venture is an
option however after initial success there is the risk of market loss for the company in this case.
There is an option of buying a company but that would be a more financially challenging
prospect especially in the Indian market (Rothaermel, 2013).
-Preferred option recommendations
Given the situation one of the best options will be partnership with any established
business in India. In this case the partnership that needs to be focused more is a sophisticated
strategic partnership with an India based organization, most probably either Dairy based or a
FMCG company. This is more so because India has a culture that is very different to the culture
of Australia. For example- In Australia one of the more important products that were sold by the
company was peanut butter. However, in India there is much lesser demand for peanut butter and
there is much lesser mass consumption of the product (Block et al., 2015). The partners will have
essential local knowledge that they can pass on to the company. This would also create a better
knowledge base that can be utilized for better strategic approach towards the market. A dairy
company in India can bring much better supply chain functions. An FMCG company would be
very good for marketing functions. Hence, an important choice needs to be made in this regards
by the organization. Both can however be significantly profitable choices with slight variations.

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Research and development considerations
Research and development of the marketing functions are very much important given the
scope of operations of the organizations. Hence, research needs to take place at a ground level.
India is a vast country with a large number of urban conglomerations, sub0urban areas and small
towns. It becomes important that all the essential factors that can affect the business potential of
the company are analyzed effectively. Some of the important R&D techniques that can be
implemented are market segmentation, product testing, advertising testing and pricing research
(Block et al., 2015). All these factors would actually contribute towards understanding the
market in better ways. Segmentation would help to know the types of customers, product testing
would give a better idea of the customer wants, advertising would help in finding more effective
communication mediums and pricing research would help to know the best process to tackle
competitor threat. Observation and focus group research can be more important in this case given
the scenarios present in the countries. The competitive strategy should be more inclined towards
the differentiation focus. In this strategy the company focuses on differentiating its products from
the competitor products (Namada, 2018). The aim is to make the product different as customers
can get the value that they usually do not get with the competitors. A slight cost focus should
also be there in order to gain further market advantage. The aim is to give a more natural and
healthier product to the customers at reasonable prices. This will help to gain more
understanding from the part of the customers. The product proposition would be far more
effective.
Production Recommendations
The production process needs to take place in India. It would be very difficult for the
company to actually bring in the supplies from Australia. If required the Dairy farms can be

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supplied with Australian livestock and managed in Indian conditions. The company also makes
products such as the Cereal Weet-Bix. The raw materials for the cereals would be easily
available in India as the country has a booming agricultural sectors with ready availability of
various types of pulses and cereals. The raw materials for the peanut butter are also easily
available in India. The production facilities need to be located in the country as that will give the
organization essential strength to maintain a smooth manufacturing and production framework.
This will in turn help to improve the supply chain functions of the organization. The cultural
factors should be taken into consideration with making products with which the Indian consumer
base can identify. As mentioned previously partnership is an important option for market entry.
Hence, a significant partner organization can be utilized for production facility in the initial
stages. The partners will have essential local knowledge that they can pass on to the company.
This would also create a better knowledge base that can be utilized for better strategic approach
towards the market. This knowledge base would be used to optimize both the production quality
and potential.
International HRM Issues
Human resource issues significantly affect the proposition of the companies especially
during times of international expansions. The three predominant human resource issues are host
country, home country and other country issues. Host country issues are related to hiring
individuals from the country of operation. Home country means sending people hired from the
home country to work in the international location. Third country is gaining human resources
from another country to work on the international location. This can mainly be any nearby or
neighboring countries. The most preferred people in case of Sanatariums expansion into India are
the Host-country nationals. Employing host country nationals are however a significant

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challenge as the hired people are not well versed with the kind of skills that are required for the
work. Hence, it is important that proper training functions are implemented. Host country
national hiring can be said to be the predominant option as it would be the most cost effective for
Sanatarium given the scenario (Sahoo & Klasen, 2018). Some of the other considerations would
be to make the larger part of the hiring process based on the country. Some foreign nationals can
be utilized for the training process as it is much important initially to create a better environment.
Conclusions
The implications that can be derived from the study is that despite the proposition of
Sanatarium to start its new venture in India, it is important that certain important aspects of the
Indian market are essentially considered. India was found to be an effective market as per the
potential to deliver profitability. However, the threats from the local competitors cannot be
overlooked. It is far more important to create products that appeal to the Indian audiences as their
tastes are quite different from the Australian publics. The business potential of Sanatarim is
improved however as it provides food and beverages that are much healthier than the rival
products even in an Indian context. This can be the one factors that if focused on effectively, can
bring better levels of productivity. Hiring expertise from the Indian HR market is important for
bringing in fresh local talent.

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References
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competitive strategy. Small Business Economics, 44(1), 37-54.
Herrera, M. E. B. (2015). Creating competitive advantage by institutionalizing corporate social
innovation. Journal of Business Research, 68(7), 1468-1474.
More, D., & Basu, P. (2013). Challenges of supply chain finance: A detailed study and a
hierarchical model based on the experiences of an Indian firm. Business Process
Management Journal, 19(4), 624-647.
Namada, J. M. (2018). Organizational learning and competitive advantage. In Handbook of
Research on Knowledge Management for Contemporary Business Environments (pp. 86-
104). IGI Global.
Noe, R. A., Hollenbeck, J. R., Gerhart, B., & Wright, P. M. (2017). Human resource
management: Gaining a competitive advantage. New York, NY: McGraw-Hill
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Paul, J., & Mas, E. (2016). The emergence of China and India in the global market. Journal of
East-West Business, 22(1), 28-50.
Rothaermel, F. T. (2013). Strategic management: concepts. New York, NY: McGraw-Hill Irwin.
Sahoo, S., & Klasen, S. (2018). Gender Segregation in Education and Its Implications for Labour
Market Outcomes: Evidence from India.

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Sanitarium Health Food Company Australia. (2019). Retrieved from
https://www.sanitarium.com.au/
Visconti, P., Bakkenes, M., Smith, R. J., Joppa, L., & Sykes, R. E. (2015). Socio-economic and
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