Coffex: Analyzing International Business Market Opportunities in India

This report provides a comprehensive analysis of Coffex's international business strategy, specifically focusing on its potential entry into the Indian market. The report begins with an executive summary and table of contents, followed by an introduction and company overview of Coffex, a major coffee roaster based in Australia. The report then delves into an in-depth analysis of the Indian market, including its economic, political, legal, social, cultural, technological, and environmental factors. A SWOT analysis is also conducted to evaluate Coffex's strengths, weaknesses, opportunities, and threats in the Indian market. The analysis considers India's economic growth, political stability, legal framework, cultural nuances, technological advancements, and environmental concerns. The report highlights the increasing coffee consumption in India, the rising middle class, and the growing coffee culture as key opportunities for Coffex. The report also discusses the challenges of corruption, labor costs, and the need to adapt to Indian cultural values. The conclusion summarizes the findings and provides insights for Coffex's successful expansion into the Indian market. The report references relevant academic sources to support its analysis.

Running head: INTERNATIONAL BUSINESS
International Business
Name of student
Name of University
Author note

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Executive summary
The report was presented to develop an idea about how the coffee business named
Coffex could exploit the market opportunity to enter the global market and ensure proper
management of skills, resources and capabilities to remain successful within the global
marketplace. The different factors responsible for affecting the business including the
economic factors, political, legal factors along with the social, cultural, technological and
environmental factors were analysed to strengthen the business functioning furthermore. The
analysis of the company’s strengths, weaknesses, opportunities and threats further enabled to
stay ahead of its competitors and gain sustenance within the global business environment of
India with much ease and efficiency.

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Table of Contents
Introduction................................................................................................................................4
Company overview....................................................................................................................4
Introduction to the chosen country.............................................................................................4
Economic analysis......................................................................................................................6
Political and legal analysis.........................................................................................................6
Social, cultural and ethical analysis...........................................................................................7
Technology issues......................................................................................................................7
Environmental issues related to sustainability...........................................................................7
Other issues................................................................................................................................8
SWOT analysis...........................................................................................................................8
Conclusions................................................................................................................................9
Reference list..............................................................................................................................9

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Assessment 2: Market opportunity report
Introduction
The report is prepared to discuss about the management of international business with
the consideration of the business organisation named Coffex in Australia, which has been a
major coffee roaster. The company aims at delivering the best quality coffee products with
the use of freshest quality coffee beans and also possesses a great network for the distribution
of products and services effectively in the Australian marketplace. The company has been
aiming to start international business by making an entry into the marketplace of India to
draw more customers and generate higher business revenue and competitive advantage too
(Dunning, 2013). The assignment will also present relevant information and data about the
overview of company and also the various factors including the political, economic, social,
technological, legal and environmental that can affect the functioning of the business while
operating in the global market. The importing nation is India where the products and services
of Coffex, Australia will be delivered to extend its business operations globally and create
scopes and opportunities for the enhancement of profit level and attainment of competitive
advantage in business as well (Coffex.com.au, 2019).
Company overview
Coffex is a major coffee roasters in Melbourne, Australia, which has combined the
unique flavour, taste and smell of the coffee that is being offered. The company is not similar
to the other wholesale coffee suppliers, rather Coffex focuses on sharing the experience of a
great coffee to the customers and enrich the premium standard in coffee roasting experience
too. The business organisation has shared passion by offering locally roasted coffee acquired
from Brunswick and this has helped in preparing the perfect blend of taste and flavour along
with providing proper support to the Organic and Fairtrade farmers to create the best cup of

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coffee. Within the southern hemisphere, the company has been a leader in coffee roasting and
it has been fostered with the help of using good quality machineries and equipment that have
facilitated the production and also served the roasting needs of people effectively (Shenkar,
Luo & Chi, 2014). With the use of good quality equipment and machineries, the coffee
experience has been elevated, which has helped in delivering superior coffee consuming
experience and ensured higher level of satisfaction among the clients all over Australia
(Coffex.com.au, 2019).
The importing country selected here has been India by Coffex, Australia to expand its
business operations and processes, because the people in India love to consume coffee
products and there is a certain amount of raze among people, which has resulted in making
coffee businesses like Baristas and Starbucks to become successful in the marketplace too.
Moreover, the coffee consumption habits and behaviours are common and people feel
interested in the beverage products, which has further helped in creating various and
opportunities for Coffex to sustain in the competitive business environment with ease and
efficiency (Killing, 2013).
Introduction to the chosen country
The country where Coffex from Australia wants to expand is India and it requires
implementation of proper market entry strategies and options for ensuring successful global
business management. The demand is quite high in the marketplace and with the
establishment of multiple coffee businesses, the revenue is forecasted to be around US $423m
in the present year. The market is expected to grow by 7.7 percent on an yearly basis.
The importing nation, being India, could enable acqusitions of stocks of green coffee
and it has been recorded on the higher side for the past few years. Due to this, often the

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higher stocks of coffee in the importing nations have put immense pressure on the coffee
prices set by the global companies when expanding in India (Dunning, 2013).
Based on the statistical observations, it could be understood that the Arabica coffee
cover 50 percent of the Indian soil along with the Robusta coffee too, which has enhanced the
productivity and also ensured over 1000 kg per hectare. A bulk amount of the production of
coffee has been exported, which enabled focusing on the marketing activities has associated
with the promotions of the brand products, thereby, increased the scopes for introduction of
global coffee retailers (Beamish, 2013). The consumption of coffee has increased moderately,
which further could enable Coffex to establish or develop a major trend considering the focus
of the beverage industry on the management of exports considering the high demand and
expectations in the Indian marketplace (Coffex.com.au, 2019).

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Figure: Coffee beans production in India (Beamish, 2013)
From various evidences, it is found that the rising middle class segments, awareness
of the brand and availability of international experiences have fostered the development of a
coffee culture in India, which represents luxury, comfort and status symbol responsible for
driving the coffee chain outlets all across India. The coffee shops have gained popularity
among the youngsters, especially, the Generation Y consumers, which has enabled the coffee
chains to bring a wide range of coffee products and at the same time, improved the décor and
ambience of the coffee shops to deliver a satisfying experience to the clients (Cavusgil et al.,
2014). There have been coffee based products as well as snacks and other interesting bites
that could be consumed while going along, thereby, represent the transformation of new age
coffee chain and enhancement of coffee drinking experience for the consumers all over too.
Therefore, the development of a coffee culture and transformation of coffee chains all across
India has created extensive scopes and opportunities for import activities along with better
accessibility for the global businesses to establish their presence in the Indian marketplace
too (Verbeke, 2013).

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Economic analysis
Based on the forecasting of economic conditions, the Gross domestic product or GDP
has been over $2.5 trillion and thus India has the seventh largest economy within the whole
world in terms of the nominal GDP. The GDP will grow consistently and has been expected
to rise much above in the upcoming years, which could also allow for foreign direct
investments and ensure better scopes and opportunities for the global businesses to sustain in
the global marketplace. The corporate tax in India is around 30 percent, which keeps
fluctuating and thus proper considerations should be made while starting international
business in India (Forsgren & Johanson, 2014). India has been one of the top most agriculture
producing nations and according to the International Coffee organisation, India has also been
the seventh largest nations in terms of producing coffee. The major exports include transport
equipment, jewellery items, readymade garments and clothes and also petroleum products.
India’s major trading partners are China, UAE, USA, etc. (Bartlett, Doz & Hedlund, 2013).
Considering the economic factors, Australia could also manage its trade relations by
importing the good quality coffee beans from Australia to India, which should resolve the
cross cultural barriers and ensure successful international business
management(Coffex.com.au, 2019).
Political and legal analysis
India is one of the most powerful nations in the whole world and has been considered
as the largest democracy that possesses a stable political environment. The political culture
has influenced the management of a good political environment, which also could facilitate
the management of foreign direct investments or FDIs to manage global business effectively.
There are frequent cases of political unrest situations, which also affect the management of
businesses here sometimes (Meyer & Peng, 2016). One of the major concerns while starting
business in India could be the corruption, which has not only affected the political

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environment, but also created major challenges to improve the growth in economy of the
nation. The costs incurred while managing the business operations and processes could
increase with this unstable political environment and it could also hinder the foreign direct
investments made on behalf of the global businesses trying to make an entry into the India
market. In spite of these, the public awareness bout the political issues and Government
initiatives undertaken could assist in overcoming the challenges associated with these
political matters, furthermore, create ease for the international businesses like Coffex to
establish its presence in India much comprehensively (Boddewyn, 2015).
Considering the legal aspects, India is known for its good numbers of foreign direct
investments and the corporate governance bodies have controlled these actions. The global
shareholders or investors could make investments for setting up a business and at the same
time, work in a limited liability partnership to set up perfectly within India. The various trade
laws, rules, regulations and legislations have significantly impacted the business by
regulating the employment relations all over India, thereby should assist the company to
maintain the legal standards accurately (Draper, 2017).
Social, cultural and ethical analysis
Due to the huge population in India, there is greater scopes and opportunities for
multinational companies to establish its business in India. In India, there is sufficient cheap
labour and also the labour force has been expected to reach an unprecedented number. Due to
this, the affordable and sufficient labour force have influenced the businesses to outsource the
business functions and processes to India, furthermore ensures maintaining a good social
status quo (Leamer & Stern, 2017). Considering the fact that India is a multi-ethnic, multi
lingua and multi religious nation, one of the major strengths of the country is its communal
harmony, which has encouraged businesses from foreign locations to adapt to the local Indian
culture quite easily and target the market segments that are aimed at. In spite of the good

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standards of living as well as middle class people with sufficient disposable income, the
nation still holds a significant number of poor people, which can be a major social issue
(Cohen, 2017).
The cultural values and ethics must be preserved and followed by the business to
make sure that the Indian culture is adapted to for stable and consistent business functioning.
The Indian culture boosts of various social values, ethical beliefs and cultural aspects that are
need to be considered by the company to ensure that they consider the needs and tastes of the
local people and gain a sustainable position within the Indian market (Wilson, 2015).
Technology issues
The country India possesses great technologies, which makes it quite advanced within
the entire world and ths it consist of an advanced Information technology or IT structure
responsible for creating great scopes and opportunities for the global businesses to work on
technological projects. Coffex could exploit this opportunity to excel in terms of
technological performance and enable management of e-commerce technologies and even
allow for use of mobile apps that can be best suited for the purpose of gaining better
accessibility to the products and services of Coffex to be delivered in India from the
customers’ perspectives (Kugler, 2018). The outsourcing work in IT could be a major
complex issue while managing business across borders while the management of
technological projects associated with the software development for the company, upgrades,
e-commerce, etc. should require huge amounts of investments that incur huge amount of
costs required for the purpose of research and development activities (Coffex.com.au, 2019).
Without the use of proper technologies and IT system implementation, the company might
also experience issues that could result in loss of confidential data and information along with
lack of marketing effectiveness due to poor technological implementation (Kolk, 2016).

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Environmental issues related to sustainability
There are several environmental issues and challenges that are associated with the
management of sustainability and it can also affect the global business to face complexities
while entering the global market. The major environmental issues have been caused due to
the high pollution level, depletion of resources in large numbers, water pollution and floods,
all of which have contributed to the loss of biodiversity and also resulted in higher waste
generation, thus creating a negative impact on the environment too (Mueller Loose &
Remaud, 2013). The foreign business, also known as the expatriates might feel difficult to
adjust with the environmental issues and cope up with the changes properly. Coffex could
utilise this opportunity by focusing on the management of sustainable and environment
friendly measures to manage the business functions and even prioritise on creating a positive
impact on the environment effectively too (García-Sánchez et al., 2013).
Other issues
There are few other issues that constitute or pose great barriers for the organization
while making an entry into the marketplace. The monopoly situation could create major
issues while the legal rights and protection laws could also hinder the success management of
global business in India for Coffex. Few other issues could also be the cultural differences
and language barriers that might create complexities for the business to gain acceptance of
the foreign culture and adapt to the local conditions perfectly (Leonidou et al., 2013). Due to
this, adapting to the new culture might be difficult whereas the local conditions might also be
difficult for Coffex to adjust too and this further could result in lacking the desired amount of
production along with failing to meet the demands and expectations of the customers in India
(Walsh & Bartikowski, 2013).

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SWOT analysis
Strengths
 Positive brand image and reputation
 Strong brand equity
 Collecting good quality and
premium coffee beans from
worldwide to add freshness and
great taste
 Extraction of good quality coffee
beans from various reliable sources
and brewing the freshest quality
coffee (Neiman, 2013)
 High level of customer satisfaction
 Large network for distribution of
products and services
 Effective targeting of the market
segments comprising of different
kinds of customers
Weaknesses
 Stiff competition within the
marketplace
 The products and services’ prices are
quite high
 Lacked innovation perspectives, due
to product and services variety are
lower
 Threats of competitors could also be
considered as a major weakness for
Coffex, Australia (Coffex.com.au,
2019).
Opportunities
 Scope for higher revenue generation
along with attainment of competitive
advantage in business
 E-commerce technology could
facilitate online business
Threats
 Threats of competitors within the
Indian marketplace
 Threats of new entrants in the
market
 Threats of substitute products and

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management
 Online delivery of products and
services to provide better
accessibility for the customers
 Social media marketing could also
enhance the channels for distribution
of products and create brand
awareness
 The presence of coffee culture in
India can boost production to meet
the demands in the market.
services
 The coffee
 Changing behaviours of consumers
regarding the purchases of products
and services
 Different rates of tax, trade laws,
rules and regulations could also
affect the company’s ability to make
an entry into the global market
(Deresky, 2017)
Conclusions
The report was prepared to present the market opportunity for Coffex to gain a
sustainable place in the global marketplace of India and manage successful global business
expansion with ease and effectiveness. To ensure making a perfect entry into the market
place of India, the company should analyse the different political, economic, social,

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technological, legal and environmental factors that should be considered while entering the
new market and ensure acqusitions of more customers along with higher revenue generation
and competitive advantage in business too. The company must adapt to the different culture
and differences in language and other barriers to ensure stale business functioning within the
business environment. The strengths of the company including strong brand equity, good
customers services and good quality coffee items helped in the exploitation of various scopes
and opportunities, which further could enable Coffex in Australia to overcome the threats of
competitors through differentiation of products and by establishing some unique features to
stay competitive within the business environment.
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