MGT/448 Final Global Business Plan Paper and Presentation

Learning Team Comprehensive Outline

Introduction

Learning Team C has selected nutritional granola bars and the country Canada to enter into a global business venture with. This outline will document pertinent regional, country, and product analysis information which justifies why this new global business venture would be a sound idea for Team C to enter into.

Region Analysis

Canada has regional alliances with numerous countries and has free trade agreements in place with more than 10 countries. These free trade agreements “provide a competitive advantage across a wide range of sectors” states (Foreign Affairs, Trade, and Development Canada, 2014). “Under an FTA, a range of Canadian goods and services benefit from the reduction or elimination of tariff and non-tariff barriers to trade, such as quotas or technical barriers” states (Foreign Affairs, trade, and Development Canada, 2014).

Canada’s Prime Minister Mulroney signed and implemented the North American Free Trade Agreement (NAFTA) with Mexico and the United States in January 1994. “NAFTA has generated economic growth and rising standards of living for the people of all three member countries” states (Foreign Affairs, Trade, and Development Canada, 2014).

Canada has many physical environmental features that effect trade. Canada has the largest border with any other country sharing this with the United States which allows for more trade of farming goods near the borders. Canada also links to three oceans: Artic, Pacific, and Atlantic. This allows for Canada to be a leader in exporting fish (Slideshare.com, 2014). The Great Lakes and St. Lawrence River help to create fertile land for farming in Southern Canada. Here they produce and export canola, wheat, and grain across the globe (Slideshare.com, 2014).

Political stability can be considered as a state of peace that is experienced in a country. This can be caused in large part to the activities of the government keeping in mind the best interests of the people. Thanks to Canada’s political stability, the country can be considered a natural playground. The United Nations ranked Canada one of the best countries in the world in which to live and Canada has also been globally recognized for its outstanding quality of life. It is also known for having a stable, progressive political environment and one of the healthiest economies in the world.

Economic conditions in Canada in 2013 throughout the current year 2014 indicate that Canadians have become more careful with their spending habits. Canadians as a whole appear to be holding on to their funds which have resulted in slow financial growth for the Canadian economy. One way to improve the economic growth would be by having an increase in the demand in exports and business investments which could improve the Canadian economy. The Central Bank in Canada believes “that a revival in the U.S. economy will eventually lead to an increase in demand for Canadian products, but due to competitive pressures and continuing weak demand, it is taking longer than expected” states (Beltrame, 2013).

There is a wide range of financing options available in Canada for new and expanding businesses. These options can range from shareholder infusions of capital to sophisticated institutional financing. Most Canadian chartered banks have a highly developed network of branch operations throughout the country. Since some of them also have a presence in the U.S. and internationally, these banks can be a useful liaison for a foreign investor establishing a business in Canada (Osler, 2009).

Canada is known for its good social and health conditions of its citizens. Canadians are proud people and work together to keep their lands clean and safe. They also receive publicly funded healthcare which helps the people to stay healthier. Their environmental conditions are much the same with plentiful water and rich soils for farming.

While Canada has not often been directly targeted for terrorist attacks it is still nonetheless susceptible and vulnerable to terrorism. Examples of terrorism threats to Canada include graduates of terrorist training camps in countries such as Afghanistan are living in Canada. Other threats include Canadians being involved in planning terrorist attacks in other countries, either while residing in or outside Canada. One other key terrorist threat to Canada came from “Osama bin Laden, whereas he had indicated that Canada was a designated target for terrorism because of Canada's role in Afghanistan following September 11, 2001” states (Canadian Security Intelligence Service, 2014). Canada as a whole should continue to be vigilant and take counter terrorism measures to ensure safety against these terrorism vulnerabilities.

Country Analysis

Canada is politically very stable by any standards. In relation to any other jurisdiction its budget deficit is moderate. They have a small balance of payments deficit as well. Their most important trading partner is the United States, followed by China and Mexico. A large surplus in its trade with the U.S. is what Canada prefers. Since the country has maintained a sound monetary policy, Canada faces very little inflation risk. Volatility seems considerably less in Canada than in the U.S. Over the past four years of financial crises, Canada has had the smallest downturn of any of the G7 countries” states (Trapunski, 2014).

Canada’s economic freedom score is 80.2, making its economy the 6th freest in the 2014 Index. Its overall score is 0.8 point better than last year, reflecting improvements in investment freedom, the management of government spending, and monetary freedom. Canada continues to be the freest economy in the North America region (The Heritage Foundation, 2014). Canada is one of the world’s most attractive investment destinations due to their transparent and stable business climate. With the economic conditions, team c is well aware that Canada is the best choice for their product. Global trade and commerce is greatly accepted. The financial system has remained stable, and cautious and wise regulations have allowed banks to survive the worldwide financial confusion with little disruption.

Many new businesses are financed through their owner’s pockets while others may need an infusion of funds from additional sources in order to start up. Canada offers small business loans for those not self-funding or using the help of their family or friends. These small business loans can be one of the best choices simply because the federal government sponsors programs which can make funding the start of a business a priority. Other financing options include seeking private investors and searching for grants or subsidies provided by the Canadian federal and provincial governments.

The physical environment in Canada is located in the Northern and Western hemisphere. From the Atlantic Ocean, The Great Lakes and the St. Lawrence River are important trade routes. There are three coastlines that surround Canada and they the Arctic from the North, Pacific from the West, and Atlantic from the East. In Canada’s East they have a large rocky area. The Rocky Mountains are located in Canada’s West. Canada’s Great Lakes and St. Lawrence River are import because they provide a way to import and export goods. The Northern area of Canada is called the Tundra which, is very cold and plain. The temperature makes it unsuitable to live there. Canada’s climate in the southern part of the region is good for farming.

The social, health and environment in Canada can be dependent on social status. Canadians with more money are said to live longer than Canadians with lower incomes. Individual lifestyles are influenced by the socioeconomic environment, which has a huge important role in Canada. Although genetics are considered to be a determinant of health, Social and physical environments, have strongly moderated their effects. Canada is considered to have a positive social environment however, only one in three Canadians will experience a period of going through poverty in their lifetime. Canada’s health status is considered to be one of the highest in the world.

Canada’s cultural considerations are known to be informal and relaxed. Communication in Canada is known to be moderately indirect. When speaking, Canadians prefer to be at arm’s length, as personal space is important. Canada is innovative and the people there display hard work, education and experience as well-regarded qualities in that country. In Canada, it is very critical to build rapport when conducting successful business affairs. Canada has a multicultural character, which offers many cultural experiences and possibilities.

Organization and Product Analysis

Quaker is an extremely profitable company that was acquired by PepsiCo in 2001. The PepsiCo organization wanted to take a stab in the isotonic sports beverage market and add Gatorade to its lineup of beverages. By this acquisition Quaker opened up a new segment that PepsiCo did not have.

Quakers cereal, snack, and health foods have expanded the market and added nutrition bars to its lineup. In Canada there is a major production facility that operates and produces for Quaker. This facility produces multiple products including Quaker granola bars and now adding healthier ingredients to its breakfast nutrition bars that are in demand and the new trend in Canada.

In Canada, since 2005, the snack bars food category has grown 5 percent every year and is estimated to be worth 750 million dollars (Weeks, 2012). Since 2008 through 2010 the number of granola bars eaten by consumers a day rose 32 percent (Weeks, 2012). This growth is believed to be due to the health conscious consumers of Canada and consumers who are always on the go and don’t have time to sit down for a healthy breakfast.

The new nutritious bar that Quaker is introducing to the health conscious consumer now has fiber and omega 3 fatty acids. The price for the nutrition bars is adequate and the prices to create them are low making the analysis of the product profitable. The need for a quick nutritious bite allows for Quaker to enter Canada and have a competitive advantage. This product will not only thrive in Canada but will expand in other areas of the region.

References