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WHITE HEAVEN GARDEN
MERVE ALTAY
Case study:
Summary
Introduction Situation Analysis SWOT Assumption And Missing
nformation Statement Of The Problems Development Of Alternatives
Alternatives Evaluation And RecommendationsImplementation
Conclusion
1.WHITE HEAVEN GARDEN (WHG)
White Heaven Garden (WHG) is a producer of Oyster Mushroom &
Some Kind of Organic Vegetables pre-ordered by restaurants and
hotels which is frequenters of it. It founded in 2010, April. It
has 10 plants (each one is 150 m2 of indoor place equipped with
systems that set the ambient temperature, ambient humidity, also
make ventilation) for mushroom cultivation and 1 acres of farmland
for ordered vegetables.
WHG serves both the consumer market, as well as restaurants
hotels all over Turkey , also it has been planning serve big hotels
from Europe especially Spain and France, therefore it made a stride
to actualize its plans via communicating with a distributor
company, in France, to distribute their crops to Europe 3 months
ago (2014, September).
Merve Altay, the founder and owner of this market opportunity
and is prepared to seize it. Merve's relentless pursuit of quality,
combined with her extensive background in mushroom cultivation and
sheer passion will propel the business into profitability.
Mission
White Heaven Gardens' main mission is to provide the
highest-quality mushrooms also, grow some specific kinds of organic
vegetables. In addition its some objectives are;Maintain positive,
steady growth each month.Experience an increase in new customers
who are turned into long-term customers. Generate brand equity in
the domestic and foreign market.
It exists to attract and maintain customers so all stuff work
long hours a day meticulously as long as they keep working in this
way, accomplish its goals, success will be inevitable.
Market SummaryWhite Heaven Garden possesses good information
about the domestic market and knows a great deal about the common
attributes of ts most prized and loyal customers. White Heaven
Garden will leverage this information to better understand who are
served, their specific needs, and how White Heaven Garden can
better communicate with them.
Growth and Share(TURKEY)CompetitorPriceGrowth Rate
(2010-2014)Market Share (Turkey)ABC Gardens10.132 milyon
TL8%37%WHG8.76 milyon TL12%35%XYZ Gardens5.568 milyon
TL6%18%Other3.2 milyon TL2%10%Average6.915 milyon TL5.75% 25%Total
27.66 milyon TL 27% 100 % 2. SWOT Analysis
2.1.StrengthsFlexibility in meeting restaurant's needs. In the
domestic market WHG produce pre-ordered special organic vegetables
for steady customers provided that they promised to buy that
vegetable at least 1 year . High-quality products, which conforms
to the Europeans standards such as GFSI (Global Food Safety
Initiative),HACCP(Hazard Analysis and Critical Control Points),ISO
9001, exceed competitors offerings of price, quality, and
service.Higher than industry margins due to production
efficiencies.Mushroom is a short-duration crop with high yield per
unit time. Technologies for value-added mushroom products have been
standardized and are ready for commercialization.Small scale of
horticultural holdings.
Stuff is Well educated ( with an agricultural engineer, 30 stuff
and owner who took mushroom cultivation courses for 3 months before
launching agriculture )Increase in the popularity of oyster
mushroom cultvaton in Turkey but lots of them launch this field
just heard somewhere (TV, internet or some friends interested in
this issue) that how profitable growing mushroom . And very few of
them are educated and professional in oyster mushroom.
2.2. WeaknessesLacking of brand equity : Although White Heaven
Gardens have been planning to exporting its crops, it lacks of
brand equity in Europe.The existence of strong competitors in
European market: The need of oyster mushroom in Europe is provided
by Greece and Spain and they are the dominant players in this
market so it is hard to prove itself as an 4 years mushroom
breeder.European people hesitations towards Turkish organic food
producing conditions and standards.A limited marketing budget to
develop brand awareness.The decreased degree of flexibility when
near full production.
The ability to developlong-term commercial contracts which
should lower costs associated with production.Development of
mushroom production on the basis of domestic and foreign
demand,Increasing consumer consciousness and demand for healthy,
quality and organic products,Accessibility to European Union, and
domestic funds,Increasing government support to domestic
growers.
2.3.Opportunities2.4. ThreatsRising input prices in the
world,Europeans trust to major mushroom producers.raising the
awareness of people about the profits of mushroom farming in
turkey. Therefore increase the number of oyster mushrooms
grower.Any Turkish entrepreneur hasnt been successful in
maintaining its existence in the foreign oyster mushroom market.
Therefore there is no successful company to hold up as an
example
3.MISSING INFORMATIONS
What is the information about the mushroom company made
agreement before?What was the duration from dealing up to failing
?What was the domestic market share of WHG when it made the
agreement with the distributor company?How much oyster mushroom is
needed in foreign market?What was the proposed price by WHG at that
time?What is the foreign competitors market share in European
oyster mushroom market?
4. PROBLEM STATEMENT
In 2012 October, WHG tried to export ts crops to Italy but it
failed . in 3 months. Greece and Spain that are the dominant
players in this market and they supply the biggest proportion of
Europeans mushroom needs. It was difficult to attain a place in the
foreign market also WHG was a 2 years mushroom breeder, it wasnt
prove itself even in domestic market yet. Beside, its annual
revenue wasnt as much as it is now and it couldnt invest the enough
money to make it visible in foreign market. Because of these
reasons , its venture remained inconclusive.However the company
took lessons these bad experience. It never gave up and started to
negotiations with a distributor company which is in France. Today
It prove itself in Turkey and it is the second biggest mushroom
breeding company with the 35% market share. Nevertheless, Europeans
have some biases towards Turkeys mushroom cultivation standards.The
problem statement for the WHGs case study is How to change European
mushroom distributor companies biases towards Turkey and be able to
achieve to gain a place in the European oyster mushroom market.
5. ALTERNATIVES
Status quo
Terminate the agreement with the distributor company and open
dealership
Increase the domestic income and bring down the price in foreign
market
6.1.Status Quo
The status quo option involves maintaining the current business
and marketing plan. Currently, WHG the second biggest mushroom
breeding company with the 35% market share and it has enough annual
revenue to set up this business. In addition after the failure ,
the company spent two productive years containing lots of
experience.
6. EVALUATION OF ALTERNATIVES
For these reasons maintain the current foreign marketing
strategy sounds logical however it is a short term soluton to this
problem because WHG hasnt made a foreign market research properly
so doesnt know the market needs exactly. In many ways like this,
its status quo isnt ready to launch out. I think it needs more
time.
6.2. Terminate The Agreement With The Dstrubutor Company and
Open Dealership;if WHG makes extensive marketing research and
obtain the weaknesses of this market in Europe, it could terminate
the agreement with the distributor company and open a dealership
,so It would not share its profit with the distributor company but
it is TOO RSKY. Since it hasnt recognzed at the market yet, it
could not sell its product as much as it assumes. Oyster mushroom
shelf life is 10 days therefore itlose itsfreshness in a few days.
If t couldnt sell the crops in a short time, it would lose money.
As its previous experiment the dealership could be closed, as soon
as opened.
6.3.Increase The Domestic Income and Bring Down The Prices in
Foreign MarketAs long as, it Divides the target markets as domestic
and foreign customers, after that identifies priority target as
growth in the domestic market and develops a marketing strategy to
supply the customers needs, it would increase the domestic income
and annual revenue ,by this way it can dominate in domestic market.
And have enough money to invest. To implement this strategy t needs
time t should postpone the negotiation made with the distributor
company.
For the sake of opening up foreign marketing , t should stop to
think to make profit for a while.When t sends its high quality
crops samples, approved from the Europeans standards with the
lowest price in the Europe mushroom market to distributors,
distributors must be satisfied to negotiate with it . After it
proves its crops quality, it would start to sell them with normal
price. It is a long term solution so it needs more money and time
however, oyster mushroom is commonly used material in Europe's
hotels and restaurants, thus their oyster mushroom market is rather
big and profitable. Be sure that all the sacrifices will amortize
themselves.
Alternatives criteriaStatus quo
Terminate the agreement with the distributor company and open
dealership;
ncrease The Domestic ncome and Bring Down The Prices n Foreign
Market
Cost321Revenue213Addressing the SWOT Analysis213Addressing the
Problem Statement213TOTAL9510
1 = worst option 2 = not worst not best 3 = best option
Alternative scoresBest AlternativeBetter AlternativeWorst
Alternativencrease The Domestic ncome and Bring Down The Prices n
Foreign Market
Status quoTerminate the agreement with the distributor company
and open dealership; From the evaluation of alternatives, the most
suitable alternative for WHG was selected. The alternative which
best coincided all the criteria is,
ncrease The Domestic ncome and Bring Down The Prices n Foreign
Market
7.IMPLEMENTATION OF THE BEST ALTERNATIVE
Implementation of the best opton steps are as follows:
Postpone/ terminate the current negotiation ,Divide the target
markets as domestic and foreign customers, Identify priority target
as growth in the domestic market, Develop a marketing strategy to
supply the customers needs, increase the domestic income and annual
revenue.
tate22As shown on the Chart 1 WHG has higher growth rate than
its competitors. Also its growth rate is increasing gradually
(Chart 2) and the market share is close to first competitor. Even
if it maintains its current state, it is easy to say ; t would
dominate the mushroom market in a year. When it implements the
steps mentioned above, it will obviously increase the grow rate and
annual revenue and dominate the Turkish mushroom market.Chart 1:
Growth and Share(TURKEY)CompetitorPriceGrowth Rate
(2010-2014)Market Share (Turkey)ABC Gardens10.132 milyon
TL8%37%WHG8.76 milyon TL12%35%XYZ Gardens5.568 milyon
TL6%18%Other3.2 milyon TL2%10%Average6.915 milyon TL5.75% 25%Total
27.66 milyon TL 27% 100 %Chart 2:Market
Analysis(TURKEY)20102011201220132014Potential
CustomersGrowthCAGRHotel
12%12,00013,44015,05316,85918,88212.00%Restaurant8%28303235387.93%Individual
customers0%000000.00%Total11.99%12,02813,47015,08516,89418,92011.99%While
increasing domestic income, make marketing research in target
foreign countries as well. Here are the some common methods for
conducting primary research methods: observation, written surveys,
personal interviews, and test marketing (offering your product on a
limited basis in order to evaluate potential sales). After market
research ,give advertisements which stress the market needs and
remedy to this needs , for developing visibility, get web design
specialist to design the current website again. Whats more give
advertisements in googleetc.
Start to negotiate with the previous distributor company end
other companies as well,Submit the crops samples to the companies,
On condition that Distributor company promises to buy the mushroom
at least 1 year periodically in some limitations , make an
agreement about selling the high quality approved crops with the
lowest price all over the Europe for a period of 6 months. Doing
this, maybe at first you cant make enough profit but it is the best
way to attain a place in the marketIn order to implement the
alternative decided upon, a Gantt chart was developed to illustrate
the sequence of events required for the new strategy.
Here is the Gantt chart prepared for this study;
8. CONCLUSION
Through the investigation of WHG, the weaknesses of the business
were identified and potential courses of action to mitigate these
weaknesses were identified. Using a SWOT analysis, it was
identified that the main strength of the business was the
difficulties to enter foreign market.It is noticed that the problem
stems from the WHG lacks OF A FOREGN marketing strategy. In order
to address the problem identified, three alternatives were
identified. And when they are evaluated, Increase The Domestic
ncome and Bring Down The Prices n Foreign Market opton was chosen
as a best soluton.Provided that the best alternatve is implemented
As shown in the Gantt chart, WHG would be able to gain a place in
the European oyster mushroom market. Besides t would ensure its
long term market share owing to the lowest price strategy.
QUESTIONS?THANK YOU
