Marketing

Marketing

Executive Summary

The chocolate industry constitutes of boxed chocolates, countlines, stratightlines, molded bars, novelties and other chocolates. The European chocolate confectionary market has grown by 2.8% in 2011 and reached a value of $42,628 million. The largest selling segment within chocolate industry is the moulded bars and accounts for 31% of the total market value. The market structure of European chocolate industry is oligopolistic as the top four firms account for 61.6% of total market value (Anonymous, 2013, p.2).

In order to enter the European chocolate market, high capital intensity is required to develop the infrastructure and production facilities as most of the chocolate products are mass marketed and produced in large volumes to ensure profitability. However, the entrance of SME is also possible by producing chocolate which are of high value and production volume is low as it undergoes crafting process rather than mechanized process. Whereas it is also difficult for SME shift consumers from consuming their preferred brand of chocolate and the new brand; possessing a threat to new entrants. The entry barriers are of moderate level for European market (Anonymous, 2013, p.2).

The international business strategy refers to the planning of business operations across the border. The corporate level strategy defines the business in which the company is involved, its systems, processes and structure. The operational strategy is concern with specific decisions to shape and develop long-term direction of the business functions. The corporate, international and operational strategy must be comprehensive and support each other for the success of organizational success and goal accomplishment (Andrew & Bill, 2005, p.147). The inter-linking of the strategy can be viewed as a triangle rather than the conventional top-down approach. The impact of one corner on the other is examined by the elasticity of their relationship which depends upon.

The international strategy literature explains that decisions making for the business competing in the global markets are imperatives for cultural and geographical differences for the subsidiaries within the business and variability among the decision making of the SMEs. The SME owners must be considered with the decision making abilities and skill required for the further expansion of the business (Kendall, 1992, p.769).

The access to the primary sources of the advantage, a vital source of competitive advantage becomes managerial characteristics because it may create a distinctive capability to execute a business strategy, in that way it becomes an advantage for the firm (Kendall, 1992, p.769). This difference between the three levels of strategy, corporate, international and operational is reflected in the formation of multi-business corporations.

Key areas of Research

The SME are faced with complex challenges and issues to maintain the competitive advantage in the international trade. This assignment will focus on the application of theories and concepts related to internationalization process for SME and for a particular region. The key areas of research areas identified and undertaken related to the international business strategy for SME in the chocolate industry of Europe region (http://ec.europa.eu).

•The growth of SME in Europe region specifically in the chocolate industry

According to the European Commission small ...