read the file then answer question for one page.
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_pantofola_doro.docxMilestone 3.1
History of the company
"These are not football boots, they are golden slippers”: so spoke the famous soccer player John Charles, referring to a pair of football shoes as comfortable as slippers. The shoes at issue were produced by an Italian company which still today is synonym of high quality, passion, attention for the details and above all made in Italy: Calzaturificio Lazzarini, today worldwide known as Pantofola d’Oro, the Italian translation for golden slippers.
The history of this pillar of the Italian shoe industry dates back to the year 1886, when the family Lazzarini established the new-born factory in the little town of Ascoli Piceno in the middle of Italy. Anyway it was not until the half of the last century, that the company became the colossal that is nowadays. In fact it was in the 50s that the soul of Pantofola d’Oro, Emidio Lazzarini, inherited his father business, who in turn had took over Emidio’s grandfather, the business founder.
Emidio managed to give new life to the company production from a personal necessity. He was a wrestler and he wanted to design and realize a pair of shoes which could enable him to feel more comfortable and to have better performances. As a result he created a more enveloping, softer and suitable shoe, which soon became the reference product in the branch of sport footwear, especially for soccer player. Since that moment on many football stars have worn Pantofola d’Oro such as Rivera, Falcão, Van Basten and Lev Yashin.
However this golden period came to an end in the 90’s, when things started to get worse for Pantofola d’Oro, due to the cutthroat competition dictated by the multinational competitors in the sector. So in 2001, to revamp the production processes of the company and to reestablished the key role of Pantofola d’Oro in the market, CEO Kim Williams together with chairman Massimo Ubaldi decided to invest also in leisurewear and in shoes suitable for other sports such as rugby or cycling, obtaining an extraordinary success which allowed the company to reinvest in the soccer segment too. Moreover with this new product line Pantofola d’Oro set foot into the fashion industry, always focusing on high quality standard and handcrafted processes, signing also the shoes worn by Spiderman in his last movie.
With a turnover of about 12,7 million dollars in 2011, a stabilized presence in 40 lands and a growth rate of 30-40% every year, Pantofola d’Oro can be properly considered a solid Italian company, which has been able to export its high qualified products and the peculiarities of Made in Italy beyond the national limits.
International operations
With the new millennium, Pantofola d’Oro has begun to extend its operating range overseas. After having served the European markets for more than a century, the Italian company has decided to conquer the customers in North America as well as in the Far East. The main overseas partners are the Usa, Korea and China, where important collaborations and agreements with big local partners have been made; while in the Eurozone Pantofola d’Oro has great contacts with Spain, Germany and also Great Britain, where last October took place a huge manifestation in Carnaby Street to promote the typical Ascoli Piceno goods, including also Pantofola d’Oro products.
Milestone 3.2
Introduction
It is exciting getting another pair of boots you knows have been hand tailored in the same manner their inventors have been doing it for more than 100 years, this boot is assembled around legacy with a touch of class to include. Not just have these boots been high quality in the same way the organization has made them since 1886, additionally they have the same ergonomic structure, making them an ageless fantastic.
Pantofola d’Oro
Pantofola d'Oro is an Italian organization whose legacy goes back to 1886 when the old Lazzarini shoemaker's shop was established in Ascoli Piceno, Italy. It was amid the 50's when Emidio Lazzarini approached club group Ascoli to make their group soccer spikes. Within a short span, the shoe industry made strides. They were prestigious for their excellent non-abrasiveness, whilst giving remarkable ball control. Emidio Lazzarini's mystery lay in the delicate calf-calfskin he utilized and the boot's ergonomic structure, which splendidly taken after the shapes of the foot. Players, for example, Puskas, Sven Erikkson and Roger are only a percentage of the players who have worn the brand over the past half century.
Breaking In/Comfort
From their cases, these boots are simply darn right exceptional. From their novel classic look to the scent of high quality calfskin, you just about feel like you are entering a different time. At your feet, they simply feel right. A standout amongst the most astonishing parts of the boot is the sole plate. It looks so inflexible and insipid, yet it has awesome adaptability in recently the right places. Frankly, many people find that the sole plate on the Lazzarini Canguro beats a number of the huge names available.
In general, what an extraordinary boot these are right from the earliest starting point. I did not discover any problem areas and was completely fulfilled by the solace they provided all through testing.
Built with Style
Despite the fact that many individuals have affection the old school style of the Lazzarini, they are not so much going to be that simple. The general style of the boot is very distinctive to all else available and does exclude any extravagant additional items like those that you will see on new discharges. The upper is just one bit of calfskin that has been hand sewed to an extremely fundamental looking soleplate. On the off chance that you like fancy shading combos and forefront innovation, these boots will not be for you.
Added Detailing
Two vital bits of subtle element are eminent. On the external side of the boot, you will discover the Pantofola mark stamp that tells you the boots are genuine. You can tell that this was hand pressed on, as not the majority of the letters are fresh. Besides, in the event that you detest putting new bands in your boots, you will not have that issue with these! Every gap contains a metal piece that makes it super simple to guide every ribbon into the spot. This is a better bit of enumerating extra that you without a doubt will not discover on any present day boots.
Performance
At the point when on the field and in real life, these boots rank with the best. Regarding touch and control, you are going to have no designations. Despite the fact that the K-calfskin is not super thin, regardless you get a decent vibe for the ball on your foot and simply enough insurance to take into consideration sweet hits of the ball with aggregate solace. Underneath the tongue, Pantofola utilize a layer of suede as cushioning between the tongue and your foot. An exceptionally welcome expansion fills an extremely legitimate need. The major issue comes during the rainy seasons. These types of shoes can sometime take in water. In the wake of abandoning them in a shady range outside with the daily paper stuffed in them, despite everything they feel heavier than they at first were. This is sure to happen with most calfskin boots, yet many do not feel like it has been this most recognizable some time recently. Sturdiness could be an issue with these boots.
Negatives
The primary concern spins around the above highlighted issue toughness of the upper. It appears as they truly drench in water and consequently you may perceive a portion of the calfskin marginally wearing. For those of you that may solicit, the joining of the upper and soleplate won't be an issue and it is in place, importance the boots are not going to go to pieces. One other negative, on the off chance that you choose to wear white socks with these you will think twice about it a short time later as the shading in the calfskin drains.
Conclusion
Everything about this boot is justified, despite all the trouble, particularly the old school feel you get while wearing them. They simply overflow class and offer incredible execution on the field. In the event that you need my recommendation, I say verify your claim a couple at any rate once in your vocation. You are going to need to pay a high cost to get a couple from Europe, so unless you have cash blazing an entire in your pocket, take a risk and clutch the trust that Pantofola bring some of their boots to the US in the not so distant future.
Milestone 3.3
There are many brands that manufacture and sell soccer shoes on an international scale now a days. Among the brands elected by consumers as the best soccer shoes on fans websites are: Nike, Adidas, Mizuno Diadora, Under Armour, Warrior, Lotto and Ryal. Those are the main direct competitors of Pantofola d’Oro. Regarding indirect competitors we also find national and local brands, lower quality and lower price brand.
Pantofola d’Oro is a very traditional brand, still making handcrafted shoes with high quality and luxury. The brand has a reputation for excellence and focus on high-end clientele that is willing to pay a higher price in exchange of that quality and luxury. Also, Pantofola is well-known for shoe’s flexibility and capacity to adapt to each foot. So quality, fashion design, flexibility and brand reputation are the main strengths of the company. On the other side, the main weaknesses are the fact that, because the brand makes handcrafted classical shoes, it does not use new technologies and synthetic materials that make the shoes lighter, like carbon fiber. One of the main critics of the customers is the fact that the soccer shoes cannot be used in the rain since they get too heavy. Another critic is that the colors of the leader come out in the socks. (I wanted to put that last phrase in a better way but I didn’t know how – if anyone knows please correct it!)
Pantofola recently entered in the American market at the end of 2012, but it main market is still Europe and, mainly, Italy. The prices in American dollars vary from $60 to $120 on the official online store. Lotto for example, sells good quality soccer footwear for a lower price ($20- $75), as well as Mizuno.
The company has three partners that are helping the growth abroad: Safe Way s.r.l for technological and accident prevention development; Calzaturificio Time that develops specific shoes for children and Officina for the design of leisure time footwear.
The main challenges faced by Pantofola are expanding the market for kid’s soccer shoes, where it needs to predict the best country and region to make that expansion, find a buyer o distributor of the shoes in those markets that contributes to maintain the brand’s reputation and provides good feedback about distribution, sales and critics. Another challenge that Pantofola faces is dealing with technological solutions for shoes, in other to make them better for its customers. (for example, using carbon fiber or near field communication technology).
The principal threat that Pantofola faces when trying to expand its market share to other countries comes from the direct competitors, specially Nike and Adidas, that together have near 65% of soccer equipment worldwide market share. Nike recorded soccer-related sales of $2.3 billion in 2014, whereas Adidas reported $2.7 billion in revenue on the same period. To defend that business, both companies spend many millions of dollars sponsoring teams and individual players, as well as on advertisement. The equity that those companies already have and the reputation and customer loyalty are huge barriers for Pantofola.
Adidas and Nike good reputation and high sales around the world, especially North American and Latin America (but also Europe) represent their main strength; together with the fact that they research, develop and use the newest technology possible to make their soccer shoes (which is really appreciated by the clientele) and, as they have many fabrics they can produce a lot of shoes in a short period and boost their sales. Those brand also have many famous sponsors around the world. One weakness would be the fact that those brands are not as traditional as Pantofola (Nike was created in 1964 and Adidas in 1924). Pantofola is consider a more luxury and exclusive shoe since it is handcrafted and sold in a smaller scale.
MILESTONE 4
Identify market success factors
4a Taking into consideration the Pantofola d'Oro necessity of growth, the most important elements to highlight in the field of geography and demography are the size of a country and its market as well as the age distribution.
Country and market size
It should be elected a country or a region with a high population density so that the number of potential customers is quite substantial and significant. The more possible future consumers there is, the most probability of success the firm has. So even if the country size can be a good indicator of the market size, it’s more important to consider the vastness and the growth rate of the market itself, because maybe a little region can be more profitable and attractive than a bigger one.
Age distribution
It’s essential to evaluate the age distribution. Pantofola d’Oro’s next challenge consists in the development of a product range suitable for children and teenagers who play football. So it’s important to get into a market with a population mainly composed by young people (approximately between 5-15 years old) and by parents who pay attention to their children activities. Moreover in a future perspective it can be positive to select a market with a high birth rate.
4d Cultural environment factors are fundamental to understand the possibility of success that an organization can have in a particular market. For Pantofola d’Oro the main points to take into consideration in this field are three:
Class structure
Every society in every country is composed by social classes whether they are explicit or not. The belonging to a particular class is given by different constituents such as wealth, by personal assets and incomes, power, which corresponds to the capacity of exerting influence on other people’s decisions, and prestige or social status, given by a mix of educational level, working environment and origins of the person. The picture aside shows a common separation of a society in terms of social class. Now, taking into consideration the high product quality and the price (between 107-160$) of Pantofola d’Oro products, the company should concentrate its efforts on a market with a middle class (both upper and lower) really interested in sneakers and professional sport shoes.
Customer preferences and tastes
Potential customers of Pantofola d’Oro shoes has to have well defined tastes and preferences which above all appreciate and appraise three elements: Made in Italy, high quality standard and the guarantee of a great product, because these are the characteristically attributes of the product. In fact shoes are completely produced in Italy following not only an artisanal production process but also the rules of style and fashion so that we can definitely speak about made in Italy and not about Italian made. Moreover the materials used to sew these shoes, such as leather and canvas, are of a very high quality, which justifies the price of the final products. Finally the history of the brand itself is an end user guarantee, as this company has been operating since 1886 collecting success after success.
Interest of customers towards sport
Pantofola d’Oro was born as a firm mainly focused on the production of football shoes but since the 80’s it has been starting widening its perspective producing shoes for other sports such as rugby and cycling to find new market opportunities. Therefore another important market factor is composed by how much people practice these kinds of sport and how much are they interested in wearing very comfortable shoes to improve their performance.
Milestone 4
Introduction
PESTLE analysis is used as a tool by the companies before starting business in new country and to track the environment of that country. PESTLE is the mnemonics in which denote P for political, E for economics, S for social, T for technology, L for legal and E for environment.
Economics Environment factors:
These factors show the economic performance of the country and have a direct impact on the company. For example increase in inflation rate of any economy would affect the pricing strategy of product and services of a company. In addition also affect the purchasing power of the consumer due to which demand and supply also affected. There are following economic factors discuss below:
Income level:
income level has a direct impact on any business the purchasing power of an individual depend on his/her income if income of an individual is high he can buy more.When income level falls, it decreases the demand of the product and services and at the result of this company sales and profit also decrease
Unemployment :
if unemployment rate in any country is high, that’s mean business can obtained labor at cheaper price, if unemployment rate is too high, than consumer spending less which shows the insufficient sale of the company which is not good. And when unemployment rate is low, it may cause the expansive labor, on the other hand the benefit of lower unemployment rate, rise in consumption of goods and services. When people have job they have money to consume more products and services.
Infrastructure development: Infrastructure is an important variable for judging the countries, regions and states development. Infrastructure is basically the physical and organization structure needed for the operations of enterprise.
Ease of doing business:
Always invest in that market where less trade barriers and promote the foreign direct investment. Company can invest in foreign market by two ways, Acquisition and Greenfield. Always invest in that country in which inflation rate is low, tax charges should be less.
Germany
Germany can certainly represent an important key end market for Pantofola d’Oro due to different factors which identify this country as a great commercial partner for Italian companies and especially for our client organization.
Geographic and Demographic factors
If we compare Germany to other nations all over the world it can be easily observed that this country is relatively small with a surface area of about 357127 sq.km. However it’s population density is pretty high (229,2 people per sq.km). So even if the size of the country is quite small, it’s high density population is a positive indicator to start analyzing the German market.
Another important element to take into consideration is clearly the age distribution, since the organization is focusing its attention on a future market where children and teenager football shoes can be profitable. In Germany young people between 0-24 years, constitute a consistent part of the population, even if not the biggest, as shown in the diagram below.
Moreover the country is quite close to Italy and this can be evaluate as a positive factor in terms of logistic, transportation and commercial exchanges.
Economic Environment Factors
Even though the deep economic crisis which since 2007 has been upsetting the whole world, including the European Union, Germany has turned out to be the EU member which has managed to face this dark period in the most efficient way. In fact Germany occupies the 4th position in the world’s largest economies and it’s the leader country in the Eurozone. Its economy is supported by well-developed infrastructures as well as continuous investments in constructions and a low unemployment rate (6,5%). Moreover the private consumption in 2013 reached the amazing value of 1.6 trillion (triple if compared to the data of 2000) and the income level is about 30 721$ per capita per year. Those are all significant data which support the thesis that Germany can be a very profitable market. Furthermore German is the first Italian commercial partner both in the fields of export and import, with a bilateral commercial value estimated at more than 91$ billion. Finally, Germany and Italy share the same currency.
Political and legal environment factors
The German political economy is associated with the word austerity, since it has imposed some strict rules to follow on the nations of the EU in order to get out of the crisis and restore the public debt. However, Germany doesn’t impose any specific restriction to commerce or investments in general and it’s also appreciated for its political stability. Probably in this field the principal thing to highlight is called “Italian Sounding Association”, born last February to protect the made in Italy products against products which look like made in Italy ones but they are not. In fact in Germany many products are advertised with Italian words or using the color of the Italian flag trying to dupe consumers. So in order to avoid any misunderstanding the association is involved in distinguishing really made in Italy products from fake ones.
Cultural environment factors
As said before, Germany is a wealthy nation with a fairly high income level. However there’s a problem related to this issue known as unequal distribution of wealth among different social classes as well as among different geographic region. On the one hand there’s a great difference between wealthy family and poor family which continues to increase, on the other hand East German regions are poorer than South and West German areas. However in general Germany is a nation where people live well and where the poverty rate is lower than in any other EU country.
Taking into account the preferences and tastes of customers it’s possible to claim that German customers show a clear preference to Made in Italy products and a significant sign of this approach is given by the newborn “Italian Sounding Association”. In fact even if over the last months there has been a stop to the Italian export, according to the data of 2007 Germany was the made in Italy shoes’ first buyer with 44 million shoes bought.
For what concern football and Germany, this is a tradition as well entrenched as in Italy, even more emphasized by the last World Cup, won actually by the German team. German people loves soccer and playing soccer, in fact more than 6.5 million people (8% of the whole population) play football regularly and take part in one of the 27000 existing football clubs all over the country.
Conclusion
The Italian textiles and clothing sector has improved its export performance towards German by 4,1% over the last years, so Pantofola d’Oro could find a good growth opportunity in this land too. However the German market displays a very high level of competitiveness and in order to have success, it’s essential to introduce highly qualitative products, which can be easily recognized from all other competitive items, and to manage to detract market share from competitors.
· There are a few big competitors in the German soccer market. Specifically, Puma and Adidas. In the beginning, two German brothers were creating one company when they split off and one create Adidas while the other Puma. Both of these companies are huge competitors in every market, especially such a big soccer country like Germany. Germany’s leading scorer on the 2014 World Cup Champion Team, Thomas Muller, scored his goals wearing Adidas’s F50 Adziero. Nike is attempting to make a move on Adidas in international soccer markets, however Adidas has a strong hold. Adidas outfitted the World Cup champion, and star Lionel Messi.
· http://www.thestreet.com/story/12736727/1/adidas-looks-to-beat-nike-for-soccer-dominance-in-2014-world-cup.html
Milestone 6.1
Entry mod
We have decided to select the export as entry mod for Pantofola d’Oro in the selected target market (Germany) because it requires low cost as compared to other entry mod, which is very important in term of competitiveness and also beneficial for the company in term of revenue. Additionally, it is optimal because export allows any enterprise to verify the way in which customers are responding to the product that the company is starting to offer. Export make possible for the company to evaluate and implement marketing strategies seeking recognition and positioning for the brand and finally, exports allows the company to know the opinions that the consumers have compared with other brands with less risks than using other entry modes. In short export as entry mod is helpful in realizing location and experience curve economy of the country in which going to start business. By exporting the product instead of entering in the new market, it is easier to suspend the export faster and cheaper than if you entered in the market.
Staffing Policy
Staffing policy of Pantofola d’Oro in Germany is very simple due to entry mod selected. To deal with the import coming from Italy, there are three options; rent the for storage facility and hire the local employees from Germany to manage it; build the warehouse in Germany and send employees from Italy and rent the warehouse and send the employees Italy. To minimizing the risk we choose to rent the warehouse and hire employees from Germany to manage the operations.
When hiring new personnel or using current employees in a new market, we have to think about what the company’s current needs are. We need to introduce our current lines while promoting the new NFC technology and children shoes. For this reason it is important to have some of your personnel be locals who have an immense understanding of the market. We would hire the locals that are involved in the distribution and marketing of the product to the German people. Their knowledge of the demographics of the region will be vital in becoming successful in Germany. We would not overlook third-country nationals that are originally from Italy. They could have the best of worlds, knowledge of Pantofola d’Oro’s business in Italy, and knowledge of the current markets in Germany.
Milestone 6.2
There are different possibilities among which a company can choose, when it comes to enter a new market. Obviously all the alternatives present some kind of pros and cons which should be evaluated properly before taking this decision. In order to find out the best way to get to the German market, a list of possible options is shown below, with a synthetic description of both negative and positive sides.
1) Joint Venture
A joint venture is a temporal partnership between two companies, which cooperate together influencing each other for a definite period of time in order to achieve some particular aims. In this case the joint venture would regard Pantofola d’Oro and a local German company.
Pros:
· Easy access to some vital factors such as capital or staff
· Easy access to new markets or distributors
· Risk or workload sharing
Cons:
· Communicative problems between the companies involved
· Different level of contribution in terms of resources or different level of assumed responsibility
· Cross- cultural differences difficult to overcome
· Partial goal sharing
2) Franchising
Franchising is a particular type of products’ distribution which is based on the relationship between a franchiser and a franchisee, who takes over the direction of some operations against a precise payment accord and ensure to keep on doing its tasks until the end of the contract.
Pros:
· Diminished risk in entering a new market
· Possible realization of scale economies
· Partners can control the development and the course of the business
Cons:
· Low direct control
· Lower profits
3) Exporting
This entry mode can be subdivided in direct and indirect exporting. The former refers to the sale of the company products to a foreign firm without any intermediate, while the latter requires various types of intermediacy in order to get the products sold. In this second case it’s possible to hire local agents who know the market very well to spread the products all over the German shoes’ market. Focusing on direct exporting, we can highlight positive and negative aspects.
Pros:
· Minimum investment risk
· Fast entry
· Possibility to sell the company overproduction
· Information about competitors
· Maximum economies of scale
Cons:
· More tariffs and transport costs lead to more costs
· Difficulty in coordinating all the operators involved in the process
· Trade barriers have to be overcome
· Company considered as an outsider
After having analyzed these three different market approaches, direct exporting has been considered the best market entry mode. In fact, many cons which have been pointed out are quite irrelevant in the German market, for instance there are no trade barriers between Germany and Italy. Moreover referring to the transport, the two nations are quite close so that there are no overseas transport costs and even if it’s true that the company could be regarded as an outsider, Pantofola d’oro is a well- established company with wonderful economic results which will soon conquer the German market. Export is a good choice too because it allows the company to control directly the market and the consumers’ tastes and preference, giving it the possibility to quickly change some aspects in order to satisfy the customers’ needs. In addition, it’s a fast entry mode and it minimizes the investment risks.
6.3
When hiring new personnel or using current employees in a new market, we have to think about what the company’s current needs are. We need to introduce our current lines while promoting the new NFC technology and children shoes. For this reason it is important to have some of your personnel be locals who have an immense understanding of the market. We would hire the locals that are involved in the distribution and marketing of the product to the German people. Their knowledge of the demographics of the region will be vital in becoming successful in Germany. We would not overlook third-country nationals that are originally from Italy. They could have the best of both worlds, knowledge of Pantofola d’Oro’s business in Italy, and knowledge of the current markets in Germany.
It is also important to keep the core values and vision of your company in tact. For that reason, we would not strictly have new personnel from Germany. We would bring in some people from Pantofola d’Oro to manage and make sure the company vision is still in tact. These people can use the expertise of the local Germans to make educated decisions for the company and the new ventures it has.
Milestone 6.4
From their cases, these boots are basically darn right uncommon. From their novel fantastic look to the fragrance of brilliant calfskin, you pretty much feel like you are entering an alternate time. At your feet, they essentially feel right. A champion amongst the most amazing parts of the boot is the sole plate. It looks so resolute and vapid, yet it has great versatility in as of late the right places.
The main key cons for this alternative are durability of the upper. It shows up as they really soak in water and hence you may see a share of the calfskin barely wearing. For those of you that may request, the joining of the upper and soleplate won't be an issue and it is set up, significance the boots are not going to go to pieces.
The brand has notoriety for fabulousness and concentrate on top of the line customers that is willing to pay a higher cost in return of that quality and extravagance. Additionally, Pantofola is remarkable for shoe's adaptability and ability to adjust to every foot. So quality, style plan, adaptability and brand notoriety are the primary qualities of the organization.
On the other side, the primary cons are the way that, in light of the fact that the brand makes handmade traditional shoes, it doesn't utilize new advances and engineered materials that make the shoes lighter, in the same way as carbon fiber. One of the principle faultfinders of the clients is the way that the soccer shoes can't be utilized as a part of the downpour since they get too substantial.
Germany fits this company. This is because of the following factors: Geographic and Demographic variables; a critical component to think seriously about is unmistakably the age appropriation, since the association is centering its consideration on a future business where kids and young person football shoes can be productive. In Germany youngsters between 0-24 years, constitute a predictable piece of the populace, regardless of the fact that not the greatest, as indicated in the graph beneath. Besides the nation is near to Italy and this can be assessed as a positive figure terms of logistic, transportation and business trades.
Financial Environment Factors; Its economy is bolstered by recently created frameworks and in addition persistent interests in developments and a low unemployment rate (6,5%). Additionally the private utilization in 2013 came to the astounding estimation of 1.6 trillion (triple if contrasted with the information of 2000) and the wage level is around 30 721$ every capita every year. Those are all huge information which bolsters the postulation that Germany can be an extremely productive business.
Political and legitimate environment components; Germany doesn't force any particular limitation to business or interests when all is said in done and its additionally refreshing for its political strength.
Social environment components; Taking into record the inclination and tastes of clients its conceivable to claim that German clients demonstrate an unmistakable inclination to Made in Italy items and a critical indication of this methodology is given by the infant "Italian Sounding Association".
Milestone 6.5
Since we are using the export mod there is no reason to develop and/or distribute in a partnership with another company. Export mod was decided for the product because of several reasons. For example, there are no trade barriers between Italy and Germany. This would make a partnership irrelevant. Pantofola d’Oro’s will be using a warehouse to store product, and hiring local German residents in order to manage and control distribution of the product. However, there is no need to involve another company in this process, since it is all controlled by Pantofola d’Oro’s
Export mod means that Pantofola d’Oro’s will not have to share any profits with another company since all operations are controlled directly by the company. There are no other parties that are directly involved with sales or distribution of the product. This also means that if any losses occur that Pantofola d’Oro’s will be responsible for assuming that risk.
The necessity for a partnership is low, which means that there are no governing principles for a partnership needed. In terms of the export mod there are low governing principles as well. That’s why the export mod is a more cost efficient way of doing business compared to a partnership.
Milestone 6.6
If you believe different staffing strategy should be used to staff different positions, explain how and why. It may be a good idea to provide your projections for the needed number of employees for each function under the proposed entry mode, their recommended pay level and pay structure (how much, and based on an annual salary, hourly wage, commission, etc.). If applicable, show sources for your numbers.
As explained in part 6.1 - 6.4, we chose the direct export strategy, where we rent a warehouse in Germany to receive the products from Italy, and hire Germany employees to manage the operations. Germany is the third largest exporter and importer in the world (2013). It accounts for more than half of European Union’s international trade. In 2013, the exports from Italy to Germany represented 12,4% of total exports.
Germany introduced a minimum wage level of €8.50 per hour in 2013 (which represents 17900€ per year) and the wage level is around 28,636€ capita per year, all in local currency, the euro.
According to a survey made by Salary Explorer, the Courier / Delivery / Transport / Drivers sector earns 3240€ per months, approximately 39000 per year.
Embracing the company’s values, we intend to pay a fair salary, according to local market averages (39000 euros per year). This also attracts good employees to work in our company, with a good knowledge about the local market . I will be an annual-base salary and we can provide commissions based on deliveries made accurate and on time, as a way to ensure the quality and timing of deliveries, which is very important to consolidate a good reputation among the new customers.
Our first warehouse would be located in the capital - Berlin, which has a high level population who are the main potential consumers of our products. This first warehouse would need:
· Chief Operating Officer - who would be responsible for making the orders from Italy and making a transportation plan
· General Coordinator - to coordinate all the other employees and local orders
· Quality Supervisor - to make sure that there were no quality problems in the transportation or even from fabric
· Truck Drivers
· Auxiliary Transport
The number of truck drives depend on a study of the potential demand in Germany, as well as how many deliveries can be made on the same day. As Germany has 16 different States and 357127 sq.km,
There would be one auxiliary per driver.
