Global Marketing: Danes Coffee's UK Market Opportunity Analysis

This report, prepared for a global marketing assignment, examines the potential for Danes Coffee to expand its market into the United Kingdom. The analysis begins with an introduction to Danes Coffee, an Australian-based specialty coffee company, and highlights the company's strengths and market position. The report then delves into a comprehensive environmental analysis of the UK, covering economic and financial conditions, political and legal factors, social and cultural aspects, and the technological landscape. The discussion includes an assessment of market opportunities and threats, considering factors such as consumer behavior, competition, and technological advancements. The report provides recommendations for Danes Coffee's market entry strategy, including targeting specific consumer segments and leveraging technological opportunities. The report concludes that the UK market presents a favorable opportunity for Danes Coffee, given the country's high coffee consumption and positive economic indicators. The report emphasizes the importance of understanding and adapting to the UK's unique market dynamics for successful international expansion.

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Executive summary
The purpose of this report is to investigate the market opportunities for the selected product
Danes product, high quality coffee for the potential international promotion and the sale of their
product to the selected country UK. The report analyzes the potential opportunities and threats
while conducting a strategic analysis of the environmental variables including economic and
financial environment analysis, the political and legal environment analysis, the social and
cultural environment analysis and the technological environment analysis of UK which
influences the market entry. The report begins by introducing the background information
necessary to understand the product and the selected country for business expansion that is UK.
It discusses on the environmental variables that might affect the international marketing
campaigns in UK. Further, it recommends ways and strategies for moving forward on the export,
considering the opportunities and threats involves. Lastly, it concludes that Danes coffee has a
favorable opportunity in UK.

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Table of Contents
Introduction......................................................................................................................................4
Discussion........................................................................................................................................4
Environmental analysis of UK.....................................................................................................5
Economic and financial environment analysis........................................................................5
Political and legal environment analysis of UK......................................................................6
Social and cultural environment analysis of UK.....................................................................7
Technological environment analysis.......................................................................................8
Recommendations............................................................................................................................9
Conclusion.....................................................................................................................................11
References......................................................................................................................................12

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Introduction
Danes Coffee is an Australian based company which offers specialty coffee with flavor
as there obsession. The company has won the Champion Australian Roaster title from the
Australian International Coffee Association of its two years running. The company sources
wholesale specialty coffee and provides the most delicious coffee flavor frits customers. The
coffee beans consists of three flavors tribes including chocolates, caramel, nuts, berries and other
fruits. The company makes it easier to choose the favorite flavors which help its customers to
understand the elements of the roasted coffee by the company. The company exists in a highly
competitive and commoditized market. The company with its strong strategy has been able to
achieve success from the year of its establishment (Dubljević, 2013). The company chooses to
expand its market in the chosen country UK. The company chooses to embrace an opportunity to
create a specific identity in the global market. The company is dedicated in building a dynamic
symbol of difference. It plans to expand its market in UK, and provide the product a platform to
authentically explain its values and ethics in an identifiable way. Up is a plenty room for the
growth and expansion of the company as it is a tea and coffee dominated culture. UK is now
considered among the most dynamic coffee markets in the world. It is highly driven by specialty
brewing and growth in the country. Therefore, UK has been chosen as a country to expand its
market and make a global presence.
Discussion

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The UK market of coffee has expanded through major emphasis on craft coffees and
locating stores in the locations where the shoppers mainly concentrate that is the high street.
There has a key success by the companies who has already expanded its business in UK. There is
a high demand for flat white espresso based, micro foam steamed milk and other forms of coffee
in UK. The coffee market segmentation in UK is highly segmented by age and behavior of every
generation. There are predictions that the coffee market will grow and expand in the future years.
Environmental analysis of UK
Coffee is the most widespread drink is UK with approximately half a trillion cups
consumed per year. The availability of coffee in UK is of various types and flavors. Therefore to
expand Danes coffee in UK, it has to provide unique feature and unique products to the
customers in order to attract more customers. The environmental analysis has been discussed
below.
Economic and financial environment analysis
There are both positive and economic factors for expanding the business in UK. The
economic conditions in UK are highly unstable, which might be a barrier for the company
growth and expansion. To analyze the economic and financial conditions of UK, the GDP
growth rate of the country, the interest rates and inflation rate of the country has been considered.
Currently, the economic and financial environment of the company is favorable for Danes coffee
business, since the economic growth of the country is positive (Fricker, 2013). The GDP growth
rate has been considered as it determines the economic growth of all the major business sectors.

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The GDP of the country measures the economic activity of the country such as the rate of
consumer spending, investment by businesses and others. It has been researched that there has
been subsequent improvement in the growth rate of GDP in UK which suggests that it is highly
favorable for Danes coffee to expand its business there. There has been a steady improvement in
consumers that has boosted the confidence of the business. However, there has been reduced
government spending and there is an increased competition in the UK coffee market (Grund &
Breeksema, 2013). While there are variations in the economic conditions of UK, the key
economic indicates suggests the current condition is favorable for the business.
Political and legal environment analysis of UK
The political factors and environment of a country impacts the business organization and
it introduces a risk factor that might impact the business organization, it might lead to looses and
compromise the profit source. The government has a vital role to play for the success of any
business organization. It plays a wide deal of power over the prevailing business organization.
The political factors have the power the change the entire results and the company has to deal
with the local along with the international political outcomes (Therivel & Paridario, 2013). The
UK politics is highly stable and the government has various programs and policies to support the
business organizations by providing them a stable economy. There are low interest rates in the
banks which enables the business to acquire loans for short term and long term. Further, there is
high competitiveness of the tax systems. It is an important element of Danes coffee to growth
and expands its product offering in the market of UK (Tucker, 2017). The stable political
conditions in UK enable the company to develop its products. The country is suitable as it has no
restrictions on the foreign exchange management, which is a positive factor for the business.

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However, there are chances that the policies and actions of the government at every level in the
country. Although the country does not restrict any foreign investors in order to protect the
domestic industry and market for any reasons. Therefore Danes coffee will be independent to
grow and expand its business operations in UK (Martin & Milas, 2013). It is important that the
company must plan the business according to the variability in the policies and regulations of the
government in UK in order to maintain a stable business environment.
Social and cultural environment analysis of UK
The population demographics are considered to be an important factor for Danes coffee.
It is important to analyze the parts of the population in order to aim the product and aim the part
of the population that is most likely to visit the stores. It implies that Danes coffee needs to
identify the segment of the customers demonstrating the percentage of the age groups that prefers
coffee. The age groups targeted by Danes coffee are mainly the people between 35-54 years.
However, the company must also consider targeting the age groups between 18 years to 24 years,
as in UK, they are most likely to hang out with their friends and family as a part of their social
life and culture (Grund & Breeksema, 2013). The company must target this segment group as
there are chances that they might continue to drink coffee in long run. The income distribution of
the consumers must also be considered by Danes coffee. It must demonstrate the ideal place to
aim their market and locate their stores. The products and services offered by Danes coffee is
more of a luxury product therefore, it needs to consider the groups with high level of income to
be spend and this should be targeted most intensely. A large number of working class consumer
are most likely to relax themselves at the coffee shops, therefore Danes coffee can take this
opportunity and promote its store at a place where it is more likely to attract customers at the

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store at any time of the day (Kostka & van Roye, 2017). The education level of the consumers in
UK are sufficient, it implies that the company is ensured of acquiring highly skilled workers
which will ensure successful operation of the business. The working conditions and safety must
also be considered by the company. The consumers are more likely to visit the stores which are
clean, assessable and comfortable, they look for services with highest order and the health and
safety issues must be fully addressed. The consumer are most likely to visit the stores that are
assessable and easy to locate, therefore, Danes coffee must consider the location close the
working area, universities, or shopping malls which will enable the company to attract more
customers. Most importantly, UK has a favorable attitude towards coffee and tea, which is an
advantage for the company. Since there is high demand for coffee and tea in this country, it
suggests that the company can take advantage of this and promote their business accordingly
(Therivel & Paridario, 2013). However, there are increasing trend of health consciousness among
the customers, therefore the business needs to provide good health and foodstuffs which are
associated to healthy living. They are increasingly looking for healthy alternatives to cakes and
cookies; this is in fact associated with coffee.
Technological environment analysis
Technological conditions are UK is most favorable. The technology is expanding at a
faster rate than the rest of the country. It is considered to be the second most connected place for
technology. The growth of technology is not restricted in UK. Danes coffee has high chance of
developing and improving its services with the help of technology and internet facilities. The
company can enable its website to customize and enable new functionality which will enable the
company to prepare for the long term growth and profitability of the business (Martin & Milas,

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2013). The company can acquire tools easily that are required to target the customers, analyze
the site data and deliver new features into the market in a short span of time. The advanced
technology in UK, will enable the product to get new materials and processes to innovate the
products offered such as, developments in the technology of coffee vending machines,
technology to run cash registers which will enable the company to access the performance of the
staffs and enable them to work more quickly and efficiently (Kim & Lee, 2017). The advanced
technology will also help the company to serve the customers more quickly and increase its
potential to serve more customers every day. The customers will not have to wait for long hours
before they are served. Thus it will enhance the efficiency of the company and build strong
customer relationship. The company needs to identify the software updates and implement them
effectively in order to keep up with the increased competition in the market of UK. This will
further improve the speed and quality of services provided in the floor. The technological
improvements will enable the company to research and develop its activities. Having a strong
R&D will help the company to increases its competition and counter the threats from the external
business environment (Lee, 2016). The rate of technological changes in the current environment
of UK market is high, much of which is about faster internet services and the speed in which the
information can be communicated. However, the company has to invest highly in order to stand
the level of competition in the market. It also needs to invest highly to expand and develop the
market in order to stay ahead of the competitors. For the research and development it has
immense opportunity to build a cutting edge research and development activity. As describes
earlier the rate of technology is higher the company can access to the facilities and more
importantly build up new ideas to innovate its product offerings to the consumers (Kim & Lee,
2017). Therefore it can be based that because of the technological advancements in this country,

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there are high chances that the business expansion will be success provided that the company
invest rightly in the company.
Recommendations
It has been researched and analyzed that the environmental factors in UK are mostly
favorable for the Danes coffee to expand its operations (Martin & Milas, 2013). However, it has
several threats and opportunities which the company needs to consider before expanding its
services. It has been analyzed that there is a continuous growth in the demands for high quality
coffee and other beverages which is an opportunity for the company to expand its business
operation; it is also supported by revenue expansion (Carvalho, Paiva & Vieira, 2016). However,
there is a threat of having health conscious customers in the economy; therefore, it is
recommended that the business must also have an option for healthy food for its health conscious
customers. The company needs to highly focus on the sales of its coffee in additional to the
coffee; it can also offer other light snacks and flavored beverages as specialty of the business.
This will help the business to attract more customers and stand out from the competition. There
is a threat of increased competition, as the demand of high quality coffee has increased, new
companies might enter the market and offer better an innovative products to the customers at a
reputable rate (Leaver, 2014). There is also increased threat the company might have to sell its
coffee items and products at a lower price, due to the pressure of the competition. However,
there is an increased opportunity for the business expansion to be successful due to high rate of
technological improvements. It is highly recommended that the business must make use of the
advanced technology in an efficient manner (Martin & Milas, 2013). However, it needs to invest

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heavily into it. It is recommended that the company must appeal to wide variety of customer’s
tastes and preferences. In order to maintain its position in the market, it needs to maintain
extensive offerings to its customers and regularly update its menu offerings as per the changing
seasons (Tucker, 2017). It has to differentiate itself based upon the quality of the coffee provided
to its customers. The type of coffee beans used must be of high quality which will further
strengthen the quality of the coffee and the style of preparing the coffee must be differentiated
from its competitors. It needs to offer a standard range for the coffee and must emphasis with
added flavors and syrups to attract the customers (Burgoine & Harrison, 2013). Further, it is also
recommended to focus on attractive product presentation inside the store and create a good
ambience.
Conclusion
Therefore from the above analysis, it can be concluded that there are various threats and
opportunity in expanding the business operations in UK. The environmental analysis of UK has
been described in the report. It has been analyzed that the economic and financial environment of
UK is mostly favorable for the business. It provides the business ample of opportunities to
expand and growth in the market of UK. The economic growth of the country is positive which
suggests that the consumer spending might increase. However, there are increased competition in
the market, which suggest that there will be prevailing price pressure. It has been analyzed that

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there is a political and legal stability in UK, which is an opportunity for the company; there is
little restrictions for the foreign investors. This provides a positive atmosphere for the business to
survive and growth. Further, there is a culture for spending time with the friends and family over
the coffee, there is an increasing demand for high quality coffee in the UK economy. Therefore
this situation is favorable for the company. However, there are increasing trend of health
consciousness among the customers, therefore the business needs to provide good health and
foodstuffs which are associated to healthy living. The technological improvements in the country
and the constant advantage are an added advantage for the company. The report has provided
various recommendations to enhance Danes Coffee, business operations in UK. It has
recommended taking the advantages of advanced technology in the country, the increasing
demand for high quality coffee.