MGT2201 Business Policy & Strategy: FMCG Market Analysis in UAE Report

This report provides a detailed analysis of the Fast-Moving Consumer Goods (FMCG) market in the UAE, focusing on Britannia's potential expansion. It employs SWOT analysis to identify internal strengths and weaknesses, as well as external opportunities and threats within the UAE market. The report highlights the importance of low operational costs, established distribution channels, and consumer preference for quality products as strengths. Weaknesses include strict import/export regulations and the risk of substitute products. Rising income levels and export potential are identified as opportunities, while increasing competition poses a significant threat. The report also emphasizes the critical skills needed for successful company establishment, such as financial management, marketing, and negotiation. It further discusses the significance of both short-term and long-term goals in achieving business objectives and addresses micro and macro environmental factors influencing the company's operations. Finally, it cautions against compromising product quality to maintain low prices, as this could negatively impact the quality-conscious consumer base.

Running head: BUSINESS POLICY AND STRATEGY
BUSINESS POLICY AND STRATEGY
Name of the Student
Name of the University
Author note

2BUSINESS POLICY AND STRATEGY
FMCG or fast moving consumer goods are the products that have a high shelf turnover at
a relatively lower cost. This type of products does not require much time, thought and a huge
monetary investment for purchase. FMCG includes products like health beverages, snack food,
dairy products, branded flour, oral care, skin care, perfumes, household cleaners etc (Srivastava,
2013).
SWOT is the acronym for strength, weakness, opportunity and threats (Dyson, 2004). It
will help to identify the key internal and external factor that affects the organization. In this
paper, the SWOT analysis will help to find the factors that affect the FMCG market of UAE.
Britannia wants to expand its business in the UAE and for that, they needs to understand
the market of FMCG products in UAE. SWOT analysis will help Britannia in understanding the
key internal and external factors that affects the working of the FMCG market in UAE.
Strengths:
 FMCG companies need a low operational cost to base its operation.
 The FMCG market in UAE will be suitable for Britannia as UAE have an established
distribution channel (Lakshmanasamy & Anil, 2015).
 The consumer market of UAE is developed and they prefer products of good quality and
this is a good sign for the FMCG market as the consumer are ready to spend any amount
in exchange of quality products.
Weaknesses:
 The legal procedures of export and import facility of UAE are strict and this affects the
organization.
 The FMCG products always have a risk of substitute or counterfeit products. In UAE or
outside UAE the FMCG products face a huge threat of substitute products.

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Opportunities:
 The rising income levels of the customer are hinting towards increased customer
spending. This is a positive sign for the FMCG market of UAE as well as for Britannia.
 The market of UAE has a huge potential for exporting. This can be possible if the EXIM
policies of UAE made suitable for the market.
Threats:
 The increasing level of competition in the market of FMCG products will be a tougher
challenge for the FMCG companies.
2. For building a company, the entrepreneur or the leader should have some skill that will help in
the successful establishment of the organization. The skills that will help in preparing a company
are:
 Financial management: Managing the finances in the company is one of the important
factors that the leader or the entrepreneur needs to have. Forecasting the cash flow and
sales and to monitor the profit and loss will help the organization is avoiding any
potential risks.
 Marketing: Marketing the product is one of the important aspects of establishing a
company. A good marketing strategy helps in creating brand awareness and also help in
creating a customer base.
 Negotiation and communication: Communicating and negotiating with the suppliers,
customers, potential investors and the employees needs to be good, Good
communication helps in effective functioning of the organization.
3. The importance of setting short-term goals is:

4BUSINESS POLICY AND STRATEGY
 It helps to establish an immediate target that motivates the employees to reach the
overall goal.
 Short-term goals help in ensuring that the operation of the organization is in the right
path.
 Short-term goals help in rectifying any mistake in the business plan in the initial stages.
The importance of long-term goals is:
 Setting long-term goals helps in achieving the objective of the business.
 Long-term goals help in building the structure of the business and implement policies
according to that.
 Long-term goals help in setting the short-term goals that maintain the production rate of
the organization.
4. The micro and the macro environmental factors that will affect the company-- are:
Micro Environment factors:
 Suppliers: The suppliers can influence the success of Britannia. The suppliers have the
power when there is only one supplier available in the market (Macaulay, 2018).
 Customer: The customers will also affect the Britannia in deciding their sales. The reason
for their usage of their product will highly affect Britannia.
 Competition: The intensity of the competition in the market will affect Britannia in
deciding their success in the market.
Macro Environment factors:
 Demographic factors: The various kinds of market segments will be influenced by the
demographic forces, which include country, ethnicity, education level, age etc (Watson,
McCarthy & Rowley, 2013).

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 Economic factors: The economic environment of UAE will highly influence the
operation of Britannia. The economic factor will influence Britannia’s productivity and
will also influence the decision making process.
5. The company should use the following troublesome strategies to avoid or use with caution
while formulating the long-term strategy:
 Britannia should avoid compromising with the quality of their products in order to keep
their prices low, as this will hamper the market of the quality conscious customer.

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References:
Dyson, R. G. (2004). Strategic development and SWOT analysis at the University of Warwick. European
journal of operational research, 152(3), 631-640.
Srivastava, S. (2013). Factors Affecting Buying Behavior of Consumers in Unauthorized Colonies for
FMCG Products. Global Journal of Management and Business Studies, 3(7), 785-792.
Lakshmanasamy, T., & Anil, C. (2015). The effect of attributes of distribution channel member on supply
chain management: an empirical analysis of social networks in business. International Journal of Logistics
Systems and Management, 21(2), 160-180.
Macaulay, S. (2018). Non-contractual relations in business: A preliminary study. In The Law and
Society Canon (pp. 155-167). Routledge.
Watson, C., McCarthy, J., & Rowley, J. (2013). Consumer attitudes towards mobile marketing in the smart
phone era. International Journal of Information Management, 33(5), 840-849.