Case Study
A Middlesex based organisation wishes to expand its market internationally.
Creative Fudge is aMiddlesex based business which manufactures and sells high quality fudge. The organisation has one store in central Middlesex as well as an online web shop. The business has a high turnover of sales from customers in the UK. Over the last year the business owners have noticed that sales have become saturated from the UK market. As a result, the owners wish to explore the idea of trading internationally. The owners acknowledge this is complex, significant and high risk. Therefore, they have decided to concentrate on trading in one country at a time, commencing with Austria.
The organisation currently purchases the ingredients to make the fudge from a supplier in Middlesex (sugar, butter, condensed milk, vanilla extract). The basic fudge mixture is produced in 5kg batches. The fudge mixture is divided into smaller batches and different flavours are added to the fudge to produce different varieties e.g. Chocolate, Caramel, Maple, Banana. One of the most popular choices is the Clotted Cream Fudge, which is made with Clotted cream sourced from Devon. The additional flavours and the packaging materials are also sourced from suppliers in Middlesex. The owners believe the ingredients should be sourced as locally as possible. The business makes several batches of fudge a day, dependent upon demand.
The organisation manufactures the fudge, in the small kitchen, at the back of the shop. The fudge is packaged in the shop and sold to customers; instore and online. The fudge has to be stored in a cool area and consumed with two weeks (after manufacture).
Online sales are received via the off-the-shelf online webshop which was purchased from 1&1. The orders are taken to the post office and distributed by Royal Mail, each day.
Creative Fudge is owned by two Business Partners, who share their passion for high quality Fudge . The business was established 5 years ago. The owners felt their was a gap in the confectionary market for high quality fudge. The business partners have won several local and national awards for the quality of their product, including a UK Great Taste Award. The business has also received several positive reviews in the national newspapers, Good Housekeeping magazine and the Good Food Magazine.
The two business partners make all of the decisions within the business. The business employs two full time assistants and two part time assistants, who work at the weekends. At present the business partners produce the fudge, as it is a secret receipe. The other members of staff assist in packing, serving and distrubuting the fudge products.
The business started by the business partners making the fudge in their kitchen at home and selling their produce at farmers markets and craft fairs.
Prince Charles tasted their fudge at one of the Craft Fairs and declared it was 'most superb'. Prince Charles and the business partners were photographed in a national newpaper. Demand grew as a result of the publicity. Six months later the business opened their shop and online webshop to cope with the increased demand. In 2011, Creative Fudge commended selling their product to wholesalers; namely, farm shops, Deli's and cafes in the UK.
A new batch of fudge is made everyday and every member of staff must stir the fudge, to encourage good luck. The staff have a morning meeting to discuss which flavours are selling the most effectively. The Business Partners try out new fudge flavours, every four months. They ask customers in the store, to taste the flavours, to obtain feedback about the potential new products. If the customers do not like the new products, they are not launched. The business partners travel around the UK to collect ideas for new fudge flavours.
The business donates 5% of its profit to a local charity.
The organisations relies on the publicity
The business trades Monday - Saturday 9.00am -6.00pm.
The fudge sells at £4.00 per 0.20kg.
Task
Write a report which outlines:
- The strategy the organisation will need to employ to trade internationally, in Austria. You must include justification and evidence to support your decisions.
- Identify three changes which will need to be made to the current process (production, distrubution, marketing and sales process) to enable the business to trade in Austria.
- A process map of the new production, distrubution and sales process to be undertaken to trade internationally, in Austria.
- Identify the current organisational culture of the business (using appropriate models/theories). Identify the areas of the organisational culture which will need to change as a result of the business trading in Austria. Identify the role of individuals within the culture change.
- Explain why managing people is important to the success of the business, drawing on relevant theory.
- Identify effective people management practices which you will employ and the practical aspects involved, to ensure the success of trading in Austria.
- Identify the specific actions you will employ to create change to enable the organisation to change its culture and processes to be able to trade internationally (using relevant theory).
- You must include justification and evidence to support your decisions, throughout the report.
- A conclusion of whether it is feasible for the business to trade in Austria
Within your report, you must ensure you sell your new ideas and make coherent arguments for your recommendations, with supporting referencing, to enable the business to trade internationally.