Strategic Market Selection: HelloFresh's International Expansion Plan

This report provides an analysis of international market selection criteria for HelloFresh's new brand expansion, focusing on factors such as GDP, competition, political and socio-cultural environments. It compares countries like Austria, France, and the Netherlands based on these criteria, ultimately justifying the selection of Denmark and Austria as prime candidates due to their high pro-organic consumer base and government support for organic farming. The report concludes that a thorough environmental analysis is crucial for successful business expansion and market leadership. Desklib offers similar solved assignments for students.

International Marketing
Management

 International marketing refers multinational process of planning as well as executing pricing,
promotion and distribution of goods, ideas and services in order to accomplish organizational
goals. This presentation is going to discuss some market selection criteria for business
expansion of new brand of Hello fresh.
INTRODUCTION

Screening criteria Discussion justification
GDP Gross domestic product plays a vital
role as it gives detailed information of
economy. In other words, it can be said
that GDP of countries help out in know
in economic condition and improved
economic condition is important
success of business (Agwu and
Onwuegbuzie, 2018).
In regard to GDP, it can be
said that by knowing this rate,
economic condition can be
known. It can help us out in
knowing as how country
operate and whether we can
make profit or not by
expanding business in the
country or not.
Competition analysis In regard to competitive analysis, it can
be said that it is one of the best ways of
identifying competitors and their
strengths, weaknesses. This analysis of
each country can help out in knowing
ways to curb competitors and refining
strategy.
The reasons of selecting this
criteria for the best country
selection of Green chef’s meal
business expansion is: to
increase profit margin and
attracting customers. This
analysis can help us out in
knowing number of existing
players, easiness to reach,
threats of substitutes and
others. All these factors can
help out in knowing the extent
STAGE 1

Political environment
Political environment shows ways in which government run country and ways in which people
behave. Government of country plays a vital role in influencing international trade. Different
countries have different rate of income tax, custom duty and others. This environment shows
employment and unemployment rate that also needs to be considered (Asian, Hafezalkotob and
John, 2019).
 The reason of selecting this criterion is to know employment rate and legislation relevant
international trade. It can help in deciding prices, profit margin and written documentary work.
Overall, it can be said that it is the factor that may affect the way in which business operate.
Social and cultural environment
Culture is known as the powerful driver for development. It shows personal characteristics and
behavior of people while they make buying decision (Katsikeas, Leonidou and Zeriti, 2019).
 By considering this factor, companies can know social behaviour of people that can help them
out in fighting against disasters. Products are being developed as per this factor like taste and
needs of people. It also helps out in knowing as whether people prefer to invest in organic and
healthy products or not.
CONT...
Katsikeas, C., Leonidou, L. and Zeriti, A., 2019

 Countries
 GDP
 Competitive analysis
 Marketing barriers
 Cost to reach
 Political environment
 Social and cultural environment
 Austria
 Austria’s GDP is estimated $461.432 billion in total and $51,936 is per capita
 It is found that Austria playing a pioneering role in implementation of first official guidelines for
organic farming. This market is keep growing that is increasing competition as well.
US companies face stiff competition from multinational corporation. After covid-19, Australian
government enforces quarantine measures seriously and importers little resources due to this (Lernoud and
Willer, 2017).
 Approximate cost to reach and opening a company in Austria is around:$9825. It include all expense
such as: company registration, legal documents, taxes fee and others
 Austria is a stable democracy. It would be better if Hello Fresh expand its new brand in this country.
 People of Austria are becoming obsessed with organic food in order to improve their health and life
expectancy after Covid-19.
Comparison of countries on the basis of
market selection criteria

 France
 3.1trillion is in total GDP of France and per capita GDP is approximate $44,995.
 Around 11.77% of share is of organic firms in France.
 Number of organic farms in this country is increasing by 13% to 41,600 and there are number of existing players.
 Complexity in labour laws, higher unemployment cost, different business norms and taxation policies make difficult for
expanding business.
 Approximate cost to reach in this country and operating business is: €2,960
 France is republic parliamentary democracy that is combined with presidential power. As compared to other, it does not have
good business environment.
 There was around $56.4 billion of sales in the year of 2020 in this segment. People are switching to buying organic food rather
buying fast food.
 The Netherlands
 $1.01 trillion is approximate GDP and $60,461 is per capita GDP of Netherlands
 Food and grocer retail growth is increasing in Netherland as the total revenue in this segment was estimated: $50.1bn that is
equivalent to 71.6% of the market’s overall value.
 Customers have right to open parcels as well as inspect them. There are strict regulations regarding food retailer and Hello fresh
will need to follow all regulations and maintaining quality of food.
 Approximate 50 Euros will be the cost to reach or amount for operating business (Willer and et.al., 2020).
 Political stability is god and companies prefer to do business in this country because of its innovative environment and digital
infrastructure.
 Organic food products in Netherland registered a market size of US$1080.9 in the year of 2019. After Covid-19, people have
become health conscious and that is why growth in this segment is continuous to show double digit growth.
Cont…

Denmark: In regard to this, it is found that people of this country have become the most pro-
organic consumers in the world. They are the one who have made this country as one of the
best organic food sectors. People of this country buy the highest % of organic product as
compared to other countries. As like Austrian government, Danish government is playing a
vital role in improving economy by changing eating behavior of people (Siiskonen and
Nuutila, 2017).
 Austria: Austria is one of the countries with the highest % of organic farms. It was the only
one country in which government paid around 168 million Euros to organic farmers in the
year of 2019. Austrian government plays a vital role in development of organic food sector
and it is the reason of healthy environment of people of this country. People of this country
have become health conscious and they prefer investing in organic food rather buying and
eating unhealthy junk food. So, on the basis of this analysis, it can be said that, it would be
better if Green Chef, healthy and organic eating plan of Hello fresh expand in this country.
Justification for choice of the best four
countries

 Countries selected
 Justification
 Austria
On the basis of analysis of selection criteria, it can be said that Austria is one of the best countries
where Hello fresh can expand its business or can open its acquired brand Green chef. The reason
behind it is, it is one of the countries that has the highest % of organic farms. Government of this
country is striving hard and has developed some strategies or action plans for increasing market
share of organic products (Timsina, 2018).
 Denmark
 Denmark is also one of top 4 countries that have the highest pro-organic consumers in the
world. People of this county are the highest number of people who knows effectiveness of
organic food. It is the main reason of selecting this country for expansion of Green chef brand
that is being acquired by Hello fresh. It has also known that government of this country has
spend 147 million Euros for increasing organic farming and supporting farmers by which they
can convert to organic production.
Comparative analysis of top 2 countries for
selecting the best one for organic food
expansion

 From the above study it has been summarized that environmental analysis plays a vital role as
it helps in knowing market situation of country. It has discussed some market selection criteria
on which basis companies select the best country and expand its business. It has further shown
reasons of considering political situation, competitive analysis and GDP rate of country while
selecting the best market for business expansion. It has further shown some strategies by
which companies can make their business expansion successful and can become the market
leader.

CONCLUSION

 Agwu, M.E. and Onwuegbuzie, H.N., 2018. Effects of international marketing environments on
entrepreneurship development. Journal of Innovation and Entrepreneurship, 7(1), pp.1-14.
 Asian, S., Hafezalkotob, A. and John, J.J., 2019. Sharing economy in organic food supply chains: A
pathway to sustainable development. International Journal of Production Economics, 218, pp.322-
338.
 Katsikeas, C., Leonidou, L. and Zeriti, A., 2019. Revisiting international marketing strategy in a
digital era: Opportunities, challenges, and research directions. International Marketing Review.
 Lernoud, J. and Willer, H., 2017. The organic and fairtrade market 2015. In The World of Organic
Agriculture 2017 (pp. 143-148). FiBL and IFOAM-Organics International.
 Nguyen, H.V. and et.al., 2019. Organic food purchases in an emerging market: The influence of
consumers’ personal factors and green marketing practices of food stores. International journal of
environmental research and public health, 16(6), p.1037.
 Siiskonen, P. and Nuutila, J., 2017, June. Development of Organic Food Production in some
European Countries. In NJF Seminar 495-4th organic Conference: Organics for tomorrow's food
systems, 19-21 June 2017, Mikkeli, Finland (Vol. 13, No. 1, pp. 106-107).
 Timsina, J., 2018. Can organic sources of nutrients increase crop yields to meet global food
demand?. Agronomy, 8(10), p.214.
 Willer, H. and et.al., 2020, February. The European Market for Organic Food at BIOFACH 2020.
Research Institute of Organic Agriculture FiBL.

REFERENCES