Assessment 2: Establishment of Business Relationships Report

This report delves into the establishment and analysis of business relationships, focusing on suppliers within the food and beverage, tourism, and hospitality sectors. It examines three key suppliers: Fonterra, John Batman Group, and Austrade, evaluating their products, services, and key performance indicators. The report provides a comparative study of these suppliers, highlighting their strengths and weaknesses relative to competitors. It explores negotiation rules, communication management, and the specifics of formal agreements, including pricing, quality, packaging, and manufacturing details. The report concludes with finalized contract agreements, outlining outcomes, approvals, and details negotiated for each supplier, providing insights into the dynamics of establishing and maintaining successful business relationships. The report aims to provide recommendations for both existing and potential suppliers to enhance their market position and competitiveness within their respective industries.

Running head: ESTABLISHMENT OF BUSINESS RELATIONSHIP
ESTABLISHMENT OF BUSINESS RELATIONSHIP
Name of the Student
Name of the University
Author note

1ESTABLISHMENT OF BUSINESS RELATIONSHIP
Table of Contents
Assessment 2...................................................................................................................................2
Part A...........................................................................................................................................2
Supplier 1: Fonterra.................................................................................................................2
Supplier 2: John Batman Group..................................................................................................2
Supplier 3: Austrade....................................................................................................................2
Key Performance Indicators of Each Supplier............................................................................3
Fonterra....................................................................................................................................3
John Batman Group.................................................................................................................3
Austrade...................................................................................................................................3
Alternative Suppliers of the Above Discussed Companies.........................................................4
A Comparative Study of the Services and Products Provided by the Companies.......................4
Recommendations........................................................................................................................5
The Communication Management of the Supplier and the Organization...............................6
Negotiations Rules...................................................................................................................6
Part C...............................................................................................................................................7
Making Formal Agreements........................................................................................................7
Supplier 1.....................................................................................................................................7
Approved.....................................................................................................................................7
Not Approved..............................................................................................................................7

2ESTABLISHMENT OF BUSINESS RELATIONSHIP
Recommended Changes...............................................................................................................7
Contractual Detail 1.....................................................................................................................7
Contractual Detail 2.....................................................................................................................7
Contractual Detail 3.....................................................................................................................7
Contractual Detail 4.....................................................................................................................8
Contractual Details 5...................................................................................................................8
Supplier 2.....................................................................................................................................8
Approved.....................................................................................................................................8
Not Approved..............................................................................................................................8
Recommended Changes...............................................................................................................8
Contractual Detail 1.....................................................................................................................8
Contractual Detail 2.....................................................................................................................9
Contractual Detail 3.....................................................................................................................9
Contractual Detail 4.....................................................................................................................9
Contractual Details 5...................................................................................................................9
The Finalized Details of the Negotiated Approvals and Non-approval....................................10
Supplier 1...................................................................................................................................10
Outcome.....................................................................................................................................10
Approved...................................................................................................................................10
Not Approved............................................................................................................................10

3ESTABLISHMENT OF BUSINESS RELATIONSHIP
Details Negotiated.................................................................................................................10
Supplier 2...................................................................................................................................11
Outcome.....................................................................................................................................11
Approved...................................................................................................................................11
Not Approved............................................................................................................................11
Details Negotiated.................................................................................................................11
Finalized Contract Agreements.................................................................................................12
References......................................................................................................................................14

4ESTABLISHMENT OF BUSINESS RELATIONSHIP
Executive Summary
The following report is a discussion on the business relationship of suppliers of different groups.
The suppliers discussed in this report are mainly the suppliers Food and beverage sectors,
hospitality and tourism and the tourism and investment industry. The report encompasses the
products and services delivered by the suppliers. The report is also a study of the comparisons
between the old suppliers and the new comers of the specified industry. The report highlights the
policies by which the new comers can compete with the existing one and emphasizes on the
negotiations made by the companies to attract the new customers in the market. The report
concludes by throwing a light on the agreements made by the suppliers with the mentioned
organization to deal with the mentioned negotiable terms and conditions of the companies.

5ESTABLISHMENT OF BUSINESS RELATIONSHIP
Assessment 2
Part A
Supplier 1: Fonterra
According to a report of IBIS World, the food and beverage industry in Australia
contributes to the generation of revenue of more than $103 billion in the last year. Fonterra, one
of the largest food and beverage industry of the nation operates an amount of 1,100 dairy farmers
and mainly supplies dairy products of the country. The company provides support to some
leading associations of the company like SupportCrew and Anchor Diary Fund (Fonterra and
Dowell 2012).
The products supplied by the company include dairy products like butter, cheese,
pasteurized milk.
Supplier 2: John Batman Group
John Batman Group, a family oriented and family operated company mainly supplies
tourism and hospitality accommodations and services to the customers. They also have hotels,
resorts, motels, serviced apartments, Holiday recreational areas, aged and healthcare products
and restaurants. All the products of the company are inclusively produced in the country itself
and have wide varieties that are within the range of the common people. The company has also
started operating the print publications in the recent years.
Supplier 3: Austrade
Austrade plays a key role in the tourism industry of the country has a significant
contribution in the country’s economy. Austrade, which is related to the Australian Trade and

6ESTABLISHMENT OF BUSINESS RELATIONSHIP
Investment Commission, provides services that help the Australian exporters and education
providers in customer services for both Australian and International companies by assisting them
in export import business, research opportunities, conducting of seminars and events. They also
provide their customers with special chartered airlines and other services.
Key Performance Indicators of Each Supplier
Fonterra
The company offers an expertise support in the dairy industry of the country by
rewarding excellence in the quality of milk. The company also invests in the manufacturing of
dairy products by improving the mix of their products. The company focuses in the sustainable
development of the farmers in farming business by engaging them in the well-equipped
technology (Shadbolt and Duncan 2014).
John Batman Group
John Batman Group has developed rapidly in the recent years by stretching their business
overseas by providing the best services to their customers not only in Australia but also in New
Zealand and the South Pacific. Since the company incorporates in a huge variety of products by
engaging professional skilled technologies and employees, the company acknowledges for
personal commitments and solutions that are proactive (Khamis 2012). The company employs
professional from a huge variety of groups like sales, marketing, graphic skills and artists,
administration. The products of the company are designed in a way that they suit every
customers of different income groups and with every budgets.

7ESTABLISHMENT OF BUSINESS RELATIONSHIP
Austrade
The company helps in developing international markets and education and accumulates
productive investments directly from the foreign companies. This in a new way strength the
tourism industry of Australia and provides services for consular and passport. The company
succeeds this by achieving contacts from extensive global networks along with quality advices
and services (Allen 2011).
Alternative Suppliers of the Above Discussed Companies
Fonterra even though the largest dairy chain in Australia faces a strong competition from
its Australian counterparts like Warrnambool Cheese and Butter and other dairy companies like
A2 which has come up to a rank 59 from 100 in the last year.
Federal Group, a private and family owned tourism and hospitality group gives a tough
challenge to the John Batman Group. The company provides services significantly in the
tourism, hospitality, casino and retail and gaming assets in Tasmania and provides employment
for 2,400 people. The company’s vision is to become the country’s most respected business
service provider through proper commitments.
Expanding Horizons is a wholesaler programmer of tourism in Australia. They provide
their customers with hotels, motels, tour guides and with other facilities and amenities required
for their customers. They also offer their customers with cruise, tour guide, and entertainment
and transport facilities important for the tourists of the country. The main facility provided by the
company is the scenic flights.

8ESTABLISHMENT OF BUSINESS RELATIONSHIP
A Comparative Study of the Services and Products Provided by the Companies
Fonterra being the largest dairy industry of the nation has obviously some advantages
over the newly found companies like Warnaambool and A2. Fonterra has a huge number of dairy
products compared to these companies. Fonterra being one of the oldest is preferred by most of
the families for their taste and quality (Trechter, McGregor and Murray-Prior 2003). On the other
hand, Warrnambool or A2 do not have such variety of products as they have come up in the
recent years.
In the hospitality sector of the country, John Batman is a trusted name while the name
Federal group has just arrived. Besides the company with its large range of products can easily
surpass the new companies like Federal group (Altinay, Brookes and Aktas 2013). In fact, the
price and quality provided by the John Batman group is much affordable for customers over the
Federal group.
The name Austrade is a familiar name in the tourism sector while Expanding Horizon has
just appeared in the market. Austrade because of its innovative services and products is a much
known name among the Australians as well as the international tourists (Baker 2014). The
pricing offered by the company is much affordable rather than the products supplied by the
Expanding Horizon.
Recommendations
In order to replace the toppers in the mentioned industries it is very important for the new
comers company to collaborate with other associates of the same industry to gain the top
position. A joint venture of the medium scale and the new companies can work together
efficiently for the excellence of the products and services of the company. The new suppliers

9ESTABLISHMENT OF BUSINESS RELATIONSHIP
must incorporate policies from the top companies to gain the industry of the company. The
tourism and the hospitality industries can include policies from the top tourism industries to
modify their packages and tourism planning. In case of existing suppliers, it is important for the
organizations to re-evaluate the pricing of the products. They must also take up initiatives to
bring some new innovative techniques in the existing packaging of their products and services.
The Communication Management of the Supplier and the Organization
At present, the company communication is mainly the integrated marketing
communication that is centrally devised by digital media. The employees of the industries are
under the authoritarian head and works in a channelized manner (Mok, Sparks and Kadampully
2013). The flow information passes from one employee to another in a devised manner that
comprises of managerial head of the different units and monitors the performance of the
individuals.
Negotiations Rules
The company cannot negotiate in terms of the quality of the products. The negotiation
cannot be made in case of services provided by the tourism and hospitality sectors. Although in
case of pricing of the products, the negotiations with the customers and the organizations can
lead to the supply and profit of the company.

10ESTABLISHMENT OF BUSINESS RELATIONSHIP
Part C
Making Formal Agreements

11ESTABLISHMENT OF BUSINESS RELATIONSHIP
Supplier 1 Approved Not Approved Recommended
Changes
Contractual Detail
1
Pricing of the product The pricing of the age-
old products as Cheese
and Butter are taken
into notice as the
market demand of
these products seemed
to be rising in the
recent years.
Contractual Detail
2
Quality of the product The product quality
cannot be changed at
any cost, as the
company is mainly
concerned about the
freshness of their
products.
Contractual Detail
3
The mode of packaging The company has paid
much attention to the
packaging of the
products by bringing in
new technologies.
Contractual Detail
4
Manufacturing details
of the products

12ESTABLISHMENT OF BUSINESS RELATIONSHIP
Contractual Details
5
Import and export of
the products
Importing and
exporting of the
products overseas has
been brought into the
notice of the company
to capture the global
market of China and
Eastern countries.
Supplier 2 Approved Not Approved Recommended
Changes
Contractual Detail
1
Pricing of the product The pricing of
hospitality products
cannot be negotiated
with the company as
the company believes
that their products are
already at a reasonable
cost.

13ESTABLISHMENT OF BUSINESS RELATIONSHIP
Contractual Detail
2
Quality of the product The product quality in
case of hospitality and
tourism can be
negotiated as the
company decided to
bring new innovative
technologies to
increase the quality of
the product.
Contractual Detail
3
Packaging The company has paid
much attention to the
packaging of the
tourism products and
the home décor to
attract tourists from
overseas.
Contractual Detail
4
Manufacturing details
of the products
The company as per its
rules has denied the
manufacturing of the
products as it is a
family-oriented
business.
Contractual Details
5
Import and export of
the products
Importing and
exporting of the
products overseas has
been brought into the

14ESTABLISHMENT OF BUSINESS RELATIONSHIP
notice of the company
to capture the tourists
of the Eastern
countries.
The Finalized Details of the Negotiated Approvals and Non-approval
Supplier 1 Outcome Approved Not Approved
Details Negotiated
Pricing The company has come
into terms with the
pricing. The prices of
dairy products like
Cheese and butter will
be lowered where as the
pricing of Italiano and
other products has
remained the same.
Approved
Quality The quality of the
company’s trade-mark
products will remain
intact as quality is what
the customers rely on.
Not approved

15ESTABLISHMENT OF BUSINESS RELATIONSHIP
Packaging The packaging of the
products will be done in
new technical
innovative manner.
Approved
Manufacturing The manufacturing of
the products will not be
changed as the products
are manufactured by the
real local farmers.
Not approved
Supplier 2 Outcome Approved Not Approved
Details Negotiated
Pricing Pricing cannot be
negotiated in case
hospitality products.
Not approved
Quality Qualities of certain
products are raised due
to the demands of the
customers.
Approved
Manufacturing Manufacturing of the
products will be done by
the company itself as
the business is owned
by the family.
Not approved

16ESTABLISHMENT OF BUSINESS RELATIONSHIP
Import and export Importing and exporting
of the products will be
increased to attract the
customers overseas.
Approved
Finalized Contract Agreements
Name of the contracting parties: Fonterra and John Batman Group
Supply conditions: The companies will supply their products at first in small volumes and then
will increase it depending on the demand of the products. The prices will be as per mentioned in
the negotiation terms. The order must be made 7days prior to the delivery of the products.
Delivery items: The delivery items will include all the dairy products by Fonterra. However, the
Italiano cannot be delivered presently. In case of John Batman Group, only the home décor
products and the hospitality products will be delivered with a prior notice period of 10days.
Payment terms: The payment can be made by using Debit and Credit cards. The option for COD
will also be there for their customers.
Specification of supplied goods and services: Prior to the delivery of the products, The supplier
will check the specifications mentioned on the products and services on the agreement papers of
the company.
Guarantee time of the products and services: The supplier will represent and warrants that the
goods are free from defects and any other defaults.

17ESTABLISHMENT OF BUSINESS RELATIONSHIP
Limited liability: The risk of loss if found will be taken into account of the supplier as soon as
the product is delivered to the customer.
Intellectual property: Both the companies reserve the copyrights, patents and trademarks of their
organizations.
Confidentiality: The companies are confidential about the security and safety of their products
for the customers.
Insurance: The companies have not yet negotiated about insurance terms and regulations.
Dispute resolution: The disputes if occurred in the term period will be negotiated by the third
party resolution.
Termination and exclusion clauses: There have been no mention of the termination and
regulation clauses mentioned in the agreement papers of both the companies.
Signature provisions: Signature provision will remain the same as mentioned in the terms and
conditions of the companies.