Spanish Vines: Case Study on Colombian Market Entry Strategy
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Case Study
AI Summary
This case study examines the feasibility of Spanish Vines entering the Colombian market. It analyzes the wine industry's global landscape, the Colombian economy, and the challenges faced by small wineries. The study explores the application of various models, including international business, strategic management, marketing management, and organizational behavior, to assess market entry strategies. Key problems include understanding consumer attitudes, developing effective marketing strategies, and deciding on the internal structure of the firm. The analysis covers PEST analysis, 7 P's of marketing, STP model, and international entry modes. The study concludes with proposed solutions and recommendations for Spanish Vines to successfully enter and compete in the Colombian market, including manufacturing in Columbia and adapting to consumer preferences. A secondary case study applies the learning to another company, offering further insights into international business and strategic decision-making.
SPANISH VINES
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EXECUTIVE SUMMARY
In 2011, worldwide wine revenues were $61 billion and its industry was at a mature
stage. It was representing signs of transitioning into the decline stage of its life cycle. The overall
revenue of the wine industry began to decline and had slow down the economy which is in a
direct relation with the wine industry. The main issue for small wineries and new entrants in the
market is to find out retail outlets with the help of which they would offer brand in the market.
Moreover, in the wine, beer and spirits industry retail channels were classified on as trade versus
off trade. On the other hand, the Colombian economy was growing at faster pace which is
directly beneficial for the entire wine industry. Due to this basic reason the entire country has
been cited as one of the most attractive emerging market.
Main drivers of the Colombian economy involve Coffee bean production, dairy products
manufacturing and ready to eat products for consumers. Around 38% of the Colombian
households were determined as affluent and 38% were middle class. The entire market of
Colombia is dominated by beer along with distilled spirits. The main problem linked with the
present study is to know whether Columbian market is feasible for Spanish Vines or not. Large
number of factors is present which may prevent company from entering into the Columbian
market which needs to be known well in advance.
Different models were undertaken for accomplishing aim of the study which are
international business, strategic management, marketing management etc. The main aim behind
carrying out this study is “To analyze the feasibility of the Colombian market for Spanish
Vines”. Spanish Vines owned its brand where overall operations are carried out with local
Spanish producers and it was bottled at Spanish vineyards with labels owned and controlled by
Spanish Vines. The entire alcoholic beverage distribution in the US market differs from a state to
another; the reason is because rules and regulations in each state were unique.
After applying different models it has been identified that market condition of Columbia
is favorable and through this it is possible for business to grab large number of opportunities
which are being present in the market. Further, applicability of marketing model such as STP has
shown that by adopting effective marketing strategy it is possible for enterprise to attract large
number of customers in the market. Moreover, the models of international business applied has
supported in understanding about companies can easily operate at global level where ample of
opportunities exist and it assist enterprise in dealing with challenges present in the business
In 2011, worldwide wine revenues were $61 billion and its industry was at a mature
stage. It was representing signs of transitioning into the decline stage of its life cycle. The overall
revenue of the wine industry began to decline and had slow down the economy which is in a
direct relation with the wine industry. The main issue for small wineries and new entrants in the
market is to find out retail outlets with the help of which they would offer brand in the market.
Moreover, in the wine, beer and spirits industry retail channels were classified on as trade versus
off trade. On the other hand, the Colombian economy was growing at faster pace which is
directly beneficial for the entire wine industry. Due to this basic reason the entire country has
been cited as one of the most attractive emerging market.
Main drivers of the Colombian economy involve Coffee bean production, dairy products
manufacturing and ready to eat products for consumers. Around 38% of the Colombian
households were determined as affluent and 38% were middle class. The entire market of
Colombia is dominated by beer along with distilled spirits. The main problem linked with the
present study is to know whether Columbian market is feasible for Spanish Vines or not. Large
number of factors is present which may prevent company from entering into the Columbian
market which needs to be known well in advance.
Different models were undertaken for accomplishing aim of the study which are
international business, strategic management, marketing management etc. The main aim behind
carrying out this study is “To analyze the feasibility of the Colombian market for Spanish
Vines”. Spanish Vines owned its brand where overall operations are carried out with local
Spanish producers and it was bottled at Spanish vineyards with labels owned and controlled by
Spanish Vines. The entire alcoholic beverage distribution in the US market differs from a state to
another; the reason is because rules and regulations in each state were unique.
After applying different models it has been identified that market condition of Columbia
is favorable and through this it is possible for business to grab large number of opportunities
which are being present in the market. Further, applicability of marketing model such as STP has
shown that by adopting effective marketing strategy it is possible for enterprise to attract large
number of customers in the market. Moreover, the models of international business applied has
supported in understanding about companies can easily operate at global level where ample of
opportunities exist and it assist enterprise in dealing with challenges present in the business
environment.. Apart from this, one of the most appropriate entry modes for Spanish vines is
manufacturing aboard where business can manufacture its own vine in the market of Columbia
and through this it is possible to serve large number of customers as per their expectations in the
market. Further, the 7P’s model has supported in understanding about the key elements such as
price, promotion, place etc through which business can better serve its target market
manufacturing aboard where business can manufacture its own vine in the market of Columbia
and through this it is possible to serve large number of customers as per their expectations in the
market. Further, the 7P’s model has supported in understanding about the key elements such as
price, promotion, place etc through which business can better serve its target market
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TABLE OF CONTENTS
CHAPTER ONE..............................................................................................................................1
Introduction..................................................................................................................................1
Case Background.........................................................................................................................1
Research Problems.......................................................................................................................2
CHAPTER 2: CASE BRIEF...........................................................................................................5
2.1 Spanish vines background.....................................................................................................5
2.2 Spanish vines current condition.............................................................................................6
2.3 Analysis of the Columbian market........................................................................................8
CHAPTER 3: PROBLEM STATEMENT....................................................................................10
3.1 Key problems.......................................................................................................................10
3.2 Plan of analysis....................................................................................................................11
3.2.2 Strategic management.......................................................................................................14
3.2.4 Organizational behavior....................................................................................................17
3.3 Research methodology.........................................................................................................18
CHAPTER 4: ANALYSIS AND FINDINGS...............................................................................20
4.1 Brief introduction.................................................................................................................20
4.2 International business..........................................................................................................20
4.2.1 Analysis of Heckscher-ohlin model..................................................................................20
4.2.2 Analysis of Richardian model of international trade.......................................................21
4.2.3 Analysis of GreetHofsteid model.....................................................................................21
4.2.4 Analysis of International entry model..............................................................................22
4.3 Strategic management..........................................................................................................22
4.3.1 PEST Analysis..................................................................................................................22
4.4 marketing management........................................................................................................23
4.4.1 Analysis of 7 P’s of marketing........................................................................................23
4.4.2 Analysis of STP model....................................................................................................24
4.5 Organizational behavior......................................................................................................25
4.5.1 Analysis of Mintzberg management roles........................................................................25
4.5.2 Analysis of McKinsey 7s model......................................................................................25
4.6 conclusion............................................................................................................................26
CHAPTER 5: PROPOSED SOLUTION TO THE PROBLEM....................................................27
5.1 International business..........................................................................................................27
5.1.1 To identify range of factors affecting business performance at global level....................27
CHAPTER ONE..............................................................................................................................1
Introduction..................................................................................................................................1
Case Background.........................................................................................................................1
Research Problems.......................................................................................................................2
CHAPTER 2: CASE BRIEF...........................................................................................................5
2.1 Spanish vines background.....................................................................................................5
2.2 Spanish vines current condition.............................................................................................6
2.3 Analysis of the Columbian market........................................................................................8
CHAPTER 3: PROBLEM STATEMENT....................................................................................10
3.1 Key problems.......................................................................................................................10
3.2 Plan of analysis....................................................................................................................11
3.2.2 Strategic management.......................................................................................................14
3.2.4 Organizational behavior....................................................................................................17
3.3 Research methodology.........................................................................................................18
CHAPTER 4: ANALYSIS AND FINDINGS...............................................................................20
4.1 Brief introduction.................................................................................................................20
4.2 International business..........................................................................................................20
4.2.1 Analysis of Heckscher-ohlin model..................................................................................20
4.2.2 Analysis of Richardian model of international trade.......................................................21
4.2.3 Analysis of GreetHofsteid model.....................................................................................21
4.2.4 Analysis of International entry model..............................................................................22
4.3 Strategic management..........................................................................................................22
4.3.1 PEST Analysis..................................................................................................................22
4.4 marketing management........................................................................................................23
4.4.1 Analysis of 7 P’s of marketing........................................................................................23
4.4.2 Analysis of STP model....................................................................................................24
4.5 Organizational behavior......................................................................................................25
4.5.1 Analysis of Mintzberg management roles........................................................................25
4.5.2 Analysis of McKinsey 7s model......................................................................................25
4.6 conclusion............................................................................................................................26
CHAPTER 5: PROPOSED SOLUTION TO THE PROBLEM....................................................27
5.1 International business..........................................................................................................27
5.1.1 To identify range of factors affecting business performance at global level....................27
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5.2 Strategic management..........................................................................................................28
5.2.1 Main issue is to know consumer attitude..........................................................................28
5.3 Marketing management.......................................................................................................29
5.3.1 Main challenge is to develop effective marketing strategies for Columbian market.......29
5.4 Organizational behavior.......................................................................................................31
5.4.1 Main issue is to decide effective internal structure of firm..............................................31
CHAPTER 6: APPLICATION OF LEARNING TO ANOTHER COMPANY...........................32
6.1 Introduction..........................................................................................................................32
6.2 Company background..........................................................................................................32
6.3 Problems of the company....................................................................................................33
6.3.1 International business.......................................................................................................33
6.3.2 Marketing management....................................................................................................33
6.3.3 Strategy management........................................................................................................33
6.3.4 Organizational behavior....................................................................................................34
6.4 Problem analysis..................................................................................................................34
6.4.1 International business.......................................................................................................34
6.4.2 Marketing management....................................................................................................35
6.4.3 Strategy management........................................................................................................35
6.4.4 Organizational behavior....................................................................................................36
6.5 Solution and recommendation.............................................................................................37
6.5.1 International business.......................................................................................................37
6.5.2 Marketing management....................................................................................................37
6.5.3 Strategy management........................................................................................................37
6.5.4 Organizational behavior....................................................................................................38
6.5 Conclusion...........................................................................................................................38
LIST OF TABLES
Figure 1: Evolution of global wine industry....................................................................................5
Figure 2: Spanish vines sales...........................................................................................................6
Figure 3: Spanish vines competitive value matrix...........................................................................7
Figure 4: Global wine production by country..................................................................................8
Figure 5: Number of Bars in Columbia...........................................................................................9
5.2.1 Main issue is to know consumer attitude..........................................................................28
5.3 Marketing management.......................................................................................................29
5.3.1 Main challenge is to develop effective marketing strategies for Columbian market.......29
5.4 Organizational behavior.......................................................................................................31
5.4.1 Main issue is to decide effective internal structure of firm..............................................31
CHAPTER 6: APPLICATION OF LEARNING TO ANOTHER COMPANY...........................32
6.1 Introduction..........................................................................................................................32
6.2 Company background..........................................................................................................32
6.3 Problems of the company....................................................................................................33
6.3.1 International business.......................................................................................................33
6.3.2 Marketing management....................................................................................................33
6.3.3 Strategy management........................................................................................................33
6.3.4 Organizational behavior....................................................................................................34
6.4 Problem analysis..................................................................................................................34
6.4.1 International business.......................................................................................................34
6.4.2 Marketing management....................................................................................................35
6.4.3 Strategy management........................................................................................................35
6.4.4 Organizational behavior....................................................................................................36
6.5 Solution and recommendation.............................................................................................37
6.5.1 International business.......................................................................................................37
6.5.2 Marketing management....................................................................................................37
6.5.3 Strategy management........................................................................................................37
6.5.4 Organizational behavior....................................................................................................38
6.5 Conclusion...........................................................................................................................38
LIST OF TABLES
Figure 1: Evolution of global wine industry....................................................................................5
Figure 2: Spanish vines sales...........................................................................................................6
Figure 3: Spanish vines competitive value matrix...........................................................................7
Figure 4: Global wine production by country..................................................................................8
Figure 5: Number of Bars in Columbia...........................................................................................9
CHAPTER ONE
Introduction
The present case is linked with Spanish Vines who’s CEO and founder is Josh Hackler.
For over six year founder of Spanish vine has applied larger efforts in expanding the product line
and distribution of Spanish wines in the competitive US market. Due to the introduction of a
unique concept and idea, Josh Hackler, the founder of Spanish Vines was awarded as Top 5 of
the best entrepreneurs under the age of 25 in the USA. Spanish vines became popular in short
period of time and sales growth was also high. After the initial phase of product line growth
which involves both partner wines and house the company shifted its emphasis to house brands
over which it has more control. In 2006, Spanish Vine received silver medal where the overall
brand portfolio ranged in price from $8 to $30 per bottles.
This case study will perform a precise analyse of the challenges faced by Spanish Vines
when deciding to enter the Colombian market. With the effectiveness of its marketing program
in the USA, this consisted on targeting the US generation X along with millennial consumers
who generally prefer to consume high quality wines (Alonso and et. al., 2014); Spanish Vines
saw the easy opportunity present on the Colombian market to sell its products. Even though,
Argentinean and Chilean wines were already anchored on the local market, the opportunity was
linked with the absence of success of the European wines due to the high taxes added and
consequently the high prices of the product. However, albeit the Chilean and Argentinean wines
were offered with low prices, the quality was also low. As a result, this was the key advantage
which can be gained, by selling high quality and value Spanish wines in the Colombian market at
competitive prices.
Case Background
In 2011, worldwide wine revenues were $61 billion and its industry was at a mature
stage. It was representing signs of transitioning into the decline stage of its life cycle. The overall
revenue of the wine industry began to decline and had slow down the economy which is in a
direct relation with the wine industry. Moreover, consumer acceptance of products has grown at
faster pace due to alteration in taste, lower prices and increase in consumer knowledge regarding
wine. Generally, European Union countries, for instance Italy, Spain and France are the major
producers of wine and they were regarded as the old world in the wine industry by their position
of the largest wine exporting nations, whose share was respectively, 21%, 17% and 17%.
1
Introduction
The present case is linked with Spanish Vines who’s CEO and founder is Josh Hackler.
For over six year founder of Spanish vine has applied larger efforts in expanding the product line
and distribution of Spanish wines in the competitive US market. Due to the introduction of a
unique concept and idea, Josh Hackler, the founder of Spanish Vines was awarded as Top 5 of
the best entrepreneurs under the age of 25 in the USA. Spanish vines became popular in short
period of time and sales growth was also high. After the initial phase of product line growth
which involves both partner wines and house the company shifted its emphasis to house brands
over which it has more control. In 2006, Spanish Vine received silver medal where the overall
brand portfolio ranged in price from $8 to $30 per bottles.
This case study will perform a precise analyse of the challenges faced by Spanish Vines
when deciding to enter the Colombian market. With the effectiveness of its marketing program
in the USA, this consisted on targeting the US generation X along with millennial consumers
who generally prefer to consume high quality wines (Alonso and et. al., 2014); Spanish Vines
saw the easy opportunity present on the Colombian market to sell its products. Even though,
Argentinean and Chilean wines were already anchored on the local market, the opportunity was
linked with the absence of success of the European wines due to the high taxes added and
consequently the high prices of the product. However, albeit the Chilean and Argentinean wines
were offered with low prices, the quality was also low. As a result, this was the key advantage
which can be gained, by selling high quality and value Spanish wines in the Colombian market at
competitive prices.
Case Background
In 2011, worldwide wine revenues were $61 billion and its industry was at a mature
stage. It was representing signs of transitioning into the decline stage of its life cycle. The overall
revenue of the wine industry began to decline and had slow down the economy which is in a
direct relation with the wine industry. Moreover, consumer acceptance of products has grown at
faster pace due to alteration in taste, lower prices and increase in consumer knowledge regarding
wine. Generally, European Union countries, for instance Italy, Spain and France are the major
producers of wine and they were regarded as the old world in the wine industry by their position
of the largest wine exporting nations, whose share was respectively, 21%, 17% and 17%.
1
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Throughout the world wine consumption rates were decreasing rapidly. In many non producing
nations wined industry started to grow where people have started to shift from alcoholic
beverages to wine, competition level is rising at faster pace but it depends from every country.
The largest global producers are Treasury wine Estates limited and E & J Gallo winery where
every enterprise has market share of less than 5%. Like other competitors firms are offering
many other types of wine with different brand name and labels (Thach and Cuellar, 2007).
The main issue for small wineries and new entrants in the market is to find out retail
outlets with the help of which they would offer brand in the market. Moreover, in the wine, beer
and spirits industry retail channels were classified on as trade versus off trade. The key
distinction between the two types of channel is that whether the beverage was consumed where it
was purchased or not. In the past, around 20 to 25% VAT was charged on imported wines and
this directly increased the cost of imported goods. Due to rise in level of duty Spanish and other
EU wines were uncompetitive in Columbia. Additionally, in 2012 free trade agreement took
place between European Union and Colombia and Peru which directly eliminated VAT for
different commodities, including wine.
On the other hand, the Colombian economy was growing at faster pace which is directly
beneficial for the entire wine industry. Due to this basic reason the entire country has been cited
as one of the most attractive emerging market. Main drivers of the Colombian economy involve
Coffee bean production, dairy products manufacturing and ready to eat products for consumers.
Around 38% of the Colombian households were determined as affluent and 38% were middle
class. The entire market of Colombia is dominated by beer along with distilled spirits (Alonso,
2015).
Research Problems
Subsequent to the case background, the main problem linked with the present study is to
know whether Columbian market is feasible for Spanish Vines or not. Large number of factors is
present which may prevent company from entering into the Columbian market which needs to be
known well in advance. Apart from this some favourable factors are also present which may
encourage company to operate successfully.
International Business:
2
nations wined industry started to grow where people have started to shift from alcoholic
beverages to wine, competition level is rising at faster pace but it depends from every country.
The largest global producers are Treasury wine Estates limited and E & J Gallo winery where
every enterprise has market share of less than 5%. Like other competitors firms are offering
many other types of wine with different brand name and labels (Thach and Cuellar, 2007).
The main issue for small wineries and new entrants in the market is to find out retail
outlets with the help of which they would offer brand in the market. Moreover, in the wine, beer
and spirits industry retail channels were classified on as trade versus off trade. The key
distinction between the two types of channel is that whether the beverage was consumed where it
was purchased or not. In the past, around 20 to 25% VAT was charged on imported wines and
this directly increased the cost of imported goods. Due to rise in level of duty Spanish and other
EU wines were uncompetitive in Columbia. Additionally, in 2012 free trade agreement took
place between European Union and Colombia and Peru which directly eliminated VAT for
different commodities, including wine.
On the other hand, the Colombian economy was growing at faster pace which is directly
beneficial for the entire wine industry. Due to this basic reason the entire country has been cited
as one of the most attractive emerging market. Main drivers of the Colombian economy involve
Coffee bean production, dairy products manufacturing and ready to eat products for consumers.
Around 38% of the Colombian households were determined as affluent and 38% were middle
class. The entire market of Colombia is dominated by beer along with distilled spirits (Alonso,
2015).
Research Problems
Subsequent to the case background, the main problem linked with the present study is to
know whether Columbian market is feasible for Spanish Vines or not. Large number of factors is
present which may prevent company from entering into the Columbian market which needs to be
known well in advance. Apart from this some favourable factors are also present which may
encourage company to operate successfully.
International Business:
2
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It is not as easy for any company to enter any new market, as a large number of
challenges are present and Spanish Vines cannot escape this rule, this is why it has to deal with it
and face an established competition.
Strategic Management
One of the biggest challenges is consumer attitude as it varies from one individual to
another. Income, demographics, health consideration and overall lifestyle of target market affects
decision taken by consumers.
Marketing Management
Argentinean and Chilean wines were already offered in the market of Colombian with
low prices. However, the quality was also low. The challenge is to offer another type of wine
whose quality is very high by competing with the existing low prices.
Research Questions
International Business
What are the challenges faced by Spanish Vines in order to enter the Columbian market?
What are the factors which lead to expansion in Columbian market?
Strategic Management
What is the accurate strategy to enter the Colombian market and meet the needs of its
consumers and made them move from a satisfying product to Spanish Vines product?
Marketing Management
It is all about, segmentation targeting and positioning in the market. How Spanish Vines
will promote their products and visible in a tough industry?
Aim and Objectives of the Study
The main aim behind carrying out this study is “To analyse the feasibility of the
Colombian market for Spanish Vines”. Spanish Vines owned its brand where overall operations
are carried out with local Spanish producers and it was bottled at Spanish vineyards with labels
owned and controlled by Spanish Vines. The entire alcoholic beverage distribution in the US
market differs from a state to another; the reason is because rules and regulations in each state
were unique.
International business
To understand the challenges faced by a company when entering a new market and
identify the factors which lead to expansion in a market
3
challenges are present and Spanish Vines cannot escape this rule, this is why it has to deal with it
and face an established competition.
Strategic Management
One of the biggest challenges is consumer attitude as it varies from one individual to
another. Income, demographics, health consideration and overall lifestyle of target market affects
decision taken by consumers.
Marketing Management
Argentinean and Chilean wines were already offered in the market of Colombian with
low prices. However, the quality was also low. The challenge is to offer another type of wine
whose quality is very high by competing with the existing low prices.
Research Questions
International Business
What are the challenges faced by Spanish Vines in order to enter the Columbian market?
What are the factors which lead to expansion in Columbian market?
Strategic Management
What is the accurate strategy to enter the Colombian market and meet the needs of its
consumers and made them move from a satisfying product to Spanish Vines product?
Marketing Management
It is all about, segmentation targeting and positioning in the market. How Spanish Vines
will promote their products and visible in a tough industry?
Aim and Objectives of the Study
The main aim behind carrying out this study is “To analyse the feasibility of the
Colombian market for Spanish Vines”. Spanish Vines owned its brand where overall operations
are carried out with local Spanish producers and it was bottled at Spanish vineyards with labels
owned and controlled by Spanish Vines. The entire alcoholic beverage distribution in the US
market differs from a state to another; the reason is because rules and regulations in each state
were unique.
International business
To understand the challenges faced by a company when entering a new market and
identify the factors which lead to expansion in a market
3
Strategic Management
To determine the effective marketing strategy through which Spanish Vines can attract
customers, analyzing the condition of wine industry at global level, gaining information
regarding EU free trade agreement and obtaining data regarding Colombian economy.
Marketing Management
To analyze the overall performance of Spanish Vines in a competitive market through
marketing strategies
Significance of the Case
This case study highlights the importance of a total analyse of an existing market before
entering to it. In other words, adopting a meticulous strategy by understanding the international
business rules, marketing and management approach are imperative in order to pierce an
attractive market. Through this case study, the importance of decision making will be scrutinized
as they are vital to avoid failures in business. This case study will respond at all of above and
much more.
Structure of the Case Study
The case study is divided into six main chapters
Chapter One: This chapter in introductive, and itself composed of 6 subchapters. It
provides an overview of the entire work including a background of the case study,
research question, problem statement and the objectives of the study. It finishes by
highlighting the importance of this case and the plan followed.
Chapter Two: Describes our case study by looking at Spanish Vines background, the
condition of the Wine industry and the company ambitions in the market.
Chapter Three: States the problems and provides a plan of analysis for each of the
problems faced.
Chapter Four: Analyze the finding from each of the problems faced by using the models
of Chapter three
Chapter Five: Will offer solutions to the problems and propose recommendations and will
finish by a critical analysis of the limitation of the study.
Chapter Six: as the chapter one, this chapter is very important, as it apply all the findings,
knowledge completed previously into another company.
4
To determine the effective marketing strategy through which Spanish Vines can attract
customers, analyzing the condition of wine industry at global level, gaining information
regarding EU free trade agreement and obtaining data regarding Colombian economy.
Marketing Management
To analyze the overall performance of Spanish Vines in a competitive market through
marketing strategies
Significance of the Case
This case study highlights the importance of a total analyse of an existing market before
entering to it. In other words, adopting a meticulous strategy by understanding the international
business rules, marketing and management approach are imperative in order to pierce an
attractive market. Through this case study, the importance of decision making will be scrutinized
as they are vital to avoid failures in business. This case study will respond at all of above and
much more.
Structure of the Case Study
The case study is divided into six main chapters
Chapter One: This chapter in introductive, and itself composed of 6 subchapters. It
provides an overview of the entire work including a background of the case study,
research question, problem statement and the objectives of the study. It finishes by
highlighting the importance of this case and the plan followed.
Chapter Two: Describes our case study by looking at Spanish Vines background, the
condition of the Wine industry and the company ambitions in the market.
Chapter Three: States the problems and provides a plan of analysis for each of the
problems faced.
Chapter Four: Analyze the finding from each of the problems faced by using the models
of Chapter three
Chapter Five: Will offer solutions to the problems and propose recommendations and will
finish by a critical analysis of the limitation of the study.
Chapter Six: as the chapter one, this chapter is very important, as it apply all the findings,
knowledge completed previously into another company.
4
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CHAPTER 2: CASE BRIEF
2.1 Spanish vines background
The present case focuses on Spanish vines which has been founded by Josh Hackler.
From past six years John Hackler is successful in expanding its product line along with
distribution in the highly competitive market of US (Espejel and Fandos, 2009). Further, there is
opportunity to expand business operations at international level. Moreover, opportunities present
in the market has encouraged Spanish vanish to operate internationally as removal of value
added tax was effective especially when operations are carried out in the Colombian market.
Mainly wines of Chilean and Argentinian were already present in the market of Colombia but
they were of low quality and cost.In short the best way to target customers was through message
and media (Geraghty and Torres, 2009). Presently Spanish wines were sold over to 1000
accounts in eight states of US and district of Columbia. Wines of Spanish owned a portfolio of
brand which covers large range of wine types along with price point and quality levels. At
present the worldwide wine revenue were $61 in the year 2011. Further, the entire industry was
maturing and was moving towards decline stage. Throughout the old world countries
consumption rate of Spanish wine started to decline.
Figure 1: Evolution of global wine industry
5
2.1 Spanish vines background
The present case focuses on Spanish vines which has been founded by Josh Hackler.
From past six years John Hackler is successful in expanding its product line along with
distribution in the highly competitive market of US (Espejel and Fandos, 2009). Further, there is
opportunity to expand business operations at international level. Moreover, opportunities present
in the market has encouraged Spanish vanish to operate internationally as removal of value
added tax was effective especially when operations are carried out in the Colombian market.
Mainly wines of Chilean and Argentinian were already present in the market of Colombia but
they were of low quality and cost.In short the best way to target customers was through message
and media (Geraghty and Torres, 2009). Presently Spanish wines were sold over to 1000
accounts in eight states of US and district of Columbia. Wines of Spanish owned a portfolio of
brand which covers large range of wine types along with price point and quality levels. At
present the worldwide wine revenue were $61 in the year 2011. Further, the entire industry was
maturing and was moving towards decline stage. Throughout the old world countries
consumption rate of Spanish wine started to decline.
Figure 1: Evolution of global wine industry
5
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(Source: Case study, Spanish vines)
The above chart represent evolution of the entire global wine industry where in the year
1970 France along with Italy dominated the entire market of wine, in the year 1980 Germany
controlled the entire market, in 1990 Australia zoomed in popularity, in the year 2000 south
America and after this year Spain entered into the market and became most popular. This chart
represents the changing scenario of the Global wine industry where market trend along with
other type of factors started to change at faster pace.
2.2 Spanish vines current condition
At present company is operating efficiently in the market of US where all the range of
operations is carried out in effective manner.Further, brand portfolio of enterprise is wide and
due to this reason firm is able to grab large number of opportunities present in the market.
Figure 2: Spanish vines sales
(Source: Case study, Spanish vines)
6
The above chart represent evolution of the entire global wine industry where in the year
1970 France along with Italy dominated the entire market of wine, in the year 1980 Germany
controlled the entire market, in 1990 Australia zoomed in popularity, in the year 2000 south
America and after this year Spain entered into the market and became most popular. This chart
represents the changing scenario of the Global wine industry where market trend along with
other type of factors started to change at faster pace.
2.2 Spanish vines current condition
At present company is operating efficiently in the market of US where all the range of
operations is carried out in effective manner.Further, brand portfolio of enterprise is wide and
due to this reason firm is able to grab large number of opportunities present in the market.
Figure 2: Spanish vines sales
(Source: Case study, Spanish vines)
6
Above chart represents the sales volume of enterprise in different years and it is showing
that company is being able to sell vines in more amounts every year. From the year 2009 to 2012
sales volume of organization has started to grow at faster pace and due to this reason overall
presence of enterprise in the market has enhanced and it is directly beneficial for Spanish vines
and company is being able to grab opportunities present in the market. Apart from this due to rise
in sales volume profitability level of organization has increased and this is in favor of company
where business is being able to gain competitive advantage and is acting as a development tool.
Figure 3: Spanish vines competitive value matrix
(Source: Case study, Spanish vines)
Above graph represents the competitive value matrix of Spanish vines which highlights
the range of factors which organization has employed in order to perform better. It involves
distribution strategy where effective distribution system of company is leading to competitive
advantage. Traditional marketing where firm has adopted social media as a tool for promoting its
range of products, customer focus where vines are offered as per taste and requirement of target
market. Through all these factors it is possible for Spanish vines to deal with the condition of
rising competition in the market and has enhanced overall performance in the market. Spanish
7
that company is being able to sell vines in more amounts every year. From the year 2009 to 2012
sales volume of organization has started to grow at faster pace and due to this reason overall
presence of enterprise in the market has enhanced and it is directly beneficial for Spanish vines
and company is being able to grab opportunities present in the market. Apart from this due to rise
in sales volume profitability level of organization has increased and this is in favor of company
where business is being able to gain competitive advantage and is acting as a development tool.
Figure 3: Spanish vines competitive value matrix
(Source: Case study, Spanish vines)
Above graph represents the competitive value matrix of Spanish vines which highlights
the range of factors which organization has employed in order to perform better. It involves
distribution strategy where effective distribution system of company is leading to competitive
advantage. Traditional marketing where firm has adopted social media as a tool for promoting its
range of products, customer focus where vines are offered as per taste and requirement of target
market. Through all these factors it is possible for Spanish vines to deal with the condition of
rising competition in the market and has enhanced overall performance in the market. Spanish
7
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