Strategic Management for Batlow Apples in the International Market

This report discusses the international opportunities for Batlow Apples, the international strategies implemented by the company, and the appropriate and inappropriate modes of entry for the company. The report also provides recommendations for the company's future strategic direction.

Strategic management
10/14/2018
Batlow Apples

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Executive Summary
Strategic management includes the formulation and implementation of the major goals and
initiatives that are taken by the top level management of the company on behalf of their owners.
The aim of this report is to understand and appreciate the strategy implementation for the
selected company in Assessment 1. This report is the continuation of the previous assessment
which is based on Batlow Apples, Australia. The findings of the report include the identification
of the international opportunities for the company. The company has the opportunity in the
market of India where people are becoming health conscious. This paper also talks about the
international strategies that the company follows in the market. These strategies include global
strategy, transnational strategy and multi-domestic strategy. The mode of entry that has been
selected by the company also matters a lot for the company due to which the discussion related
to the most appropriate and inappropriate mode of entry has been done. This includes exporting
as the appropriate mode of entry and franchising as the inappropriate mode of entry. In the end,
the recommendation related to the selected market for the company has been done.

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Contents
Introduction......................................................................................................................................3
Australia Agribusiness sector..........................................................................................................4
International opportunities for Batlow apples.................................................................................5
Demographic profile....................................................................................................................5
Growth in agribusinesses.............................................................................................................6
The rise in expansion opportunities.............................................................................................6
International strategies.....................................................................................................................6
Multi-domestic strategy...............................................................................................................6
Global strategy.............................................................................................................................7
Transnational strategy..................................................................................................................7
Mode of market entry......................................................................................................................7
Appropriate mode of entry- Exporting........................................................................................8
Inappropriate mode of entry- Franchising...................................................................................8
Recommendations..........................................................................................................................10
Conclusion.....................................................................................................................................11
References......................................................................................................................................12

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Introduction
In the current era, the companies need to implement the strategies which are required to survive
in the competitive market across the world. Moreover, these strategies are linked to the growth of
the business across the world. The report is based on the Batlow Apples which was already taken
in the previous assessment. The company has a huge presence in the market of Australia and
customers can easily access the products through supermarkets and greengrocers (Batlow, 2018).
This report will talk about the growth of Australia's agribusiness sector. This leads to the
opportunities for the business in other markets across the worlds which are discussed with the
international strategy that is implemented by the company. The entry modes that are appropriate
or inappropriate are discussed with the future suggestion for the chosen market. The market
where the opportunities for the company are available in India.

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Australia Agribusiness sector
Agribusiness in Australia is and will always be working as the pillar support of the country. This
sector is diverse which is evident as it involves agricultural services and products across the food
supply chain. The sector is currently on the mature stage with a large number of companies who
are dealing in this sector. This has been found that the value of the agribusiness sector is
predicted to increase with the annualised of 2.5% in the coming 10 years which means 2022-23
(IBIS World, 2018). In addition, the food and agribusiness sector is an essential part of the
economy of Australia as it is able to contribute to the economies of regional areas. This sector
contributes with the help of employment, business and service opportunities that are present
within the market (Australian Government, 2018). The sector of Australia agribusiness and food
is considered as the iconic part of the identity. Accordingly, the industry is predicated as $256
billion dollars which are further expected to grow. Agribusiness is expanding their business
operations in other markets. In the international rise, the major focus is in Asia in the middle
class because it is growing in food and fibre demands. There are certain opportunities and
challenges which have been found in 2017 for the Australian food and agribusiness sector.
 Farms that are present in Australia produce enough food which helps in meeting the
needs of 80 million. Further, they have the opportunity to export the agribusiness and
food products in the overseas market (Minter Ellison, 2018).
 Increase in regulations related to the food raises a concern related to the safety/purity
which is important in this sector. This is the reason due to which it is considered as the
fundamental value proposition for exporters of Australia.

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 Ag Tech is an essential part of Australian agribusiness directions in future which arise
through GPS tracking, sensors and many others.
International opportunities for Batlow apples
Over the last 95 years, Batlow has grown to become one of Australia's most elite producers of
fresh and fruit-derived products. The company follows their rich heritage which is apple growing
due to which the company still offer a delicious range of fresh apples that are grown in the farms
of Australia (Batlow, 2018). The company is currently making their all the products available in
Australia and with this company is exporting their products in 100 countries. Though, this is the
fact that they don’t have the physical presence in these markets (Pedersen, 2017). Batlow apples
have vast business opportunities for expanding their business operations in the countries of Asia.
According to the analysis, this has been found that with the population of 132.42 crores there is
the presence of the large and growing market of the food products in India. Accordingly, the
market of India is appropriate for the Batlow (Rabo Equity, 2018). Some of the opportunities that
are present in the market include: -
Demographic profile
The demographic profile of the country includes younger population, increase in the income, an
increase in urbanisation with the changes in the lifestyles pattern of the country. Along with this,
there are changes in the patterns of food consumption as people are steadily changing in favour
of the branded and packed food with the easy kitchen solution and the health foods (Agribusiness
Australia, 2018). This leads to the rise in the food and agribusiness with the rise in demand for
healthy products which include apple, cherries, juice and cider which is suggested by every
doctor.

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Growth in agribusinesses
In the market of India, agribusinesses are predicated to contribute more than 30% to India’s gross
domestic product. Moreover, the rise in the contribution leads to the several new opportunities
which include the rise in employment of the workforce which is approx. 45.5% as per the recent
survey that was conducted by the Labour Bureau (Iyer and Singhi, 2018). This shows that the
economy of the country will increase which ultimately contribute to the growth of the
agribusiness sector.
The rise in expansion opportunities
The expansion of Batlow apples in India will further lead to business opportunities in the region
of Asia because the country will help in forming foreign contacts with other companies across
Bangladesh, Pakistan and many others. The expansion in the country will help in generating the
high revenue.
International strategies
International strategies are the strategies which are used by the companies while dealing their
operations in the international market. These strategies include Multi-domestic strategy, global
strategy and transnational strategy (Rothaermel, 2015). The strategies which are used by the
Batlow apples are discussed below: -
Multi-domestic strategy
The strategy includes that the company attain the maximum response from the local customer by
offering customized products to them. Batlow Company exports their products in the different
market which is done by the company considering the needs of the importers (Grünig and

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Morschett, 2017). The importers evaluate their market and identify the needs of customers so
that they can demand the right products at the right quantity.
Global strategy
The global strategy is one of the effective international strategies which show that organisation is
offering their products and services beyond the borders. The strategy is applied by the company
so that they can meet their objective of being the leading company and to earn a profit in the
market (Holmes Jr, Hoskisson, Kim, Wan and Holcomb, 2018). Batlow Company follows this
strategy as under this they export products in more than 100 countries across the world which
means they have the presence in the international market. Furthermore, they have to make their
products easily available in every departmental and supermarket across the world (Hitt, 2016).
Transnational strategy
In this international strategy, the company sell their products in different countries across the
world. The company doesn't consider the local needs of the customers as they focus on supplying
their products in the market (Hitt, Li and Xu, 2016). Batlow Company makes use of this strategy
as they export their products in many countries where the demand of the products is not clear due
to which the company don’t consider the local demand of the people and export all the products
that they have with them.
Mode of market entry
Market entry mode is the way through which the company can enter to expand their business
operations. There is the presence of different types of market entry mode that can be used by the
company to enter the market. These modes include exporting, licensing, joint venture,

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franchising and many others (Hollender, Zapkau and Schwens, 2017). Batlow Company also
enter into the market due to which the below-given discussion is related to the most appropriate
and inappropriate mode of entry.
Appropriate mode of entry- Exporting
Batlow is able to make their presence in countries outside Australia with the help of the
exporting mode of entry. This shows that exporting mode of entry is the most appropriate mode
of entry in which the company can sell their products in other markets according to their needs
(Musso and Francioni, 2014). This mode of the method is better than the other mode of entry
because the company is not supposed to expand the huge amount of taking a license or opening
their stores in other countries (Shen, Puig and Paul, 2017). The mode of entry is advantageous
for the company as it will enhance the sales, market share and profit of company which is an
ultimate goal of Batlow. The company will get to know the needs of the other countries which
will help them in diversifying their business operations (Stoian, Rialp and Dimitratos, 2017).
This will lead to the growth and success of the business. The exporting mode of entry will allow
the company to expand their life cycle related to the product which leads to the increase in the
profit of the company.
Inappropriate mode of entry- Franchising
Franchising is considered as a most inappropriate mode of entry because in this entry mode one
party allow the other party right to use the trademark of the company (Ang, Benischke and Doh,
2015). Batlow Company is managing the business operations from Australia only and opening a
franchise will not do because they supply fruits which need particular climate which will be
available in some of the countries. Along with this, the Batlow Company needs to get into the
formal agreement with the other party which include the legal proceeding. This leads to a rise in

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the risk factor and also the additional cost that is linked with it (Queensland Government, 2018).
The bad performance by the other franchises can affect the reputation of the company which is
the negative side of selecting this mode of entry. In addition to this, there are many other factors
that can affect the working of the company if this mode of entry has been selected by them.

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Recommendations
This section of the report includes the recommendation related to the future strategic direction of
the Batlow Apples in the international market of India that has been selected for expansion.
 This is suggested to the company to expand their business in the Indian market with the
help of exporting because the products of the company are not available in India. This
will help the company in generating the profit which is the ultimate motive of the
company.
 It is suggested to the company to fetch for the new opportunities in the Asian market.
This will not only improve the image of the company in the market but will also enhance
the possibilities of diversification and business expansion.
 The company will get to know about the culture of the Asian countries which will help
them in understanding the demands of Asian countries. Further, it is suggested to make
use of this knowledge in their business operations.

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Conclusion
In the end, it can be said that Batlow Company needs to implement the strategies in the
competitive market. The report reflects that the sector of agribusiness of Australia is predicted to
increase in the coming years due to which there are opportunities for the companies to expand
the business in the overseas market. Further, the report includes the opportunities for Batlow
apples in the market of India where they can export their products. The need for healthy food is
increasing in the market of India due to which the companies can get the benefit of the high
amount of sales which ultimately leads to a rise in the profit of the company. The discussion
related to the international strategies that reflect that the company follow multi-domestic
strategy, transnational strategy and global strategy in the overseas market. Along with these
strategies, the company need to decide the market entry mode which is selected by them for
entering into the market. This has been found that an appropriate mode of entry for the company
is exporting with this the most inappropriate mode of entry for the company is franchising. In the
end, the suggestions have been shared with the company related to the strategic future actions
that are required to be taken by the company for future growth.

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References
Agribusiness Australia (2018) Agribusiness Australia [Online]. Available from:
https://www.agribusiness.asn.au/about-us/overview [Accessed on 14th October 2018]
Ang, S.H., Benischke, M.H. and Doh, J.P. (2015) The interactions of institutions on foreign
market entry mode. Strategic Management Journal, 36(10), pp.1536-1553.
Australian Government (2018) Food and Agribusiness Industry [Online]. Available from:
https://archive.industry.gov.au/industry/IndustrySectors/FoodManufacturingIndustry/Pages/
default.aspx [Accessed on 14th October 2018]
Batlow (2018) About [Online]. Available from: https://batlow.com.au/about/ [Accessed on 14th
October 2018]
Batlow (2018) Contact us [Online]. Available from: https://batlow.com.au/contact-us/
[Accessed on 14th October 2018]
Batlow (2018) Home [Online]. Available from: https://batlow.com.au/ [Accessed on 14th October
2018]
Grünig, R. and Morschett, D. (2017) Developing international strategies. New York: Springer
Berlin Heidelberg.
Hitt, M.A. (2016) International strategy and institutional environments. Cross Cultural &
Strategic Management, 23(2), pp.206-215.
Hitt, M.A., Li, D. and Xu, K. (2016) International strategy: From local to global and
beyond. Journal of World Business, 51(1), pp.58-73.

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Hollender, L., Zapkau, F.B. and Schwens, C. (2017) SME foreign market entry mode choice and
foreign venture performance: The moderating effect of international experience and product
adaptation. International Business Review, 26(2), pp.250-263.
Holmes Jr, R.M., Hoskisson, R.E., Kim, H., Wan, W.P. and Holcomb, T.R. (2018) International
strategy and business groups: A review and future research agenda. Journal of world
business, 53(2), pp.134-150.
IBIS World (2018) Agribusiness - Australia Market Research Report [Online]. Available from:
https://www.ibisworld.com.au/industry-trends/market-research-reports/thematic-reports/
agribusiness.html [Accessed on 14th October 2018]
Iyer, A. and Singhi, A. (2018) Indian Agribusiness [Online]. Available from: http://media-
publications.bcg.com/Indian-Agribusiness.pdf [Accessed on 14th October 2018]
Minter Ellison (2018) Australian food and agribusiness 2017 key themes [Online]. Available
from: https://www.minterellison.com/articles/australian-food-and-agribusiness-2017-key-themes
[Accessed on 14th October 2018]
Musso, F. and Francioni, B. (2014) International strategy for SMEs: criteria for foreign markets
and entry modes selection. Journal of Small Business and Enterprise Development, 21(2),
pp.301-312.
Pedersen, D. (2017) A fundamental shift for Batlow Apples [Online]. Available from:
https://www.theland.com.au/story/4662796/batlow-apple-growers-hand-over-the-reins/
[Accessed on 14th October 2018]

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Queensland Government (2018) Advantages and disadvantages of buying a franchise [Online].
Available from: https://www.business.qld.gov.au/starting-business/buying-business/buying-
franchise/advantages-disadvantages [Accessed on 14th October 2018]
Rabo Equity (2018) Food and Agribusiness [Online]. Available from:
http://www.raboequity.com/food_and_agribusiness.php [Accessed on 14th October 2018]
Rothaermel, F.T. (2015) Strategic management. New York: McGraw-Hill Education.
Shen, Z., Puig, F. and Paul, J. (2017) Foreign market entry mode research: A review and
research agenda. The International Trade Journal, 31(5), pp.429-456.
Stoian, M.C., Rialp, J. and Dimitratos, P. (2017) SME networks and international performance:
Unveiling the significance of foreign market entry mode. Journal of Small Business
Management, 55(1), pp.128-148.