Channel And Pricing Strategies Essay

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Running head: CHANNEL AND PRICING STRATEGIESChannel and Pricing StrategiesUniversity of PhoenixNovember 8, 2010Channel and Pricing StrategiesThe success and performance of any new product for a given firm is subject to the channel and pricing strategies practiced by the company. A process that considers how consumers in a given target market interpret and evaluate price is used to establish the initial price offering of a new product. Consideration is also given to the economic landscape of the target market by means of an environmental scan. For Kudler Fine Foods to be successful in its international expansion, they will have to select proper pricing and channel strategies that are consistent with the target market's economic landscape. The strategies chosen must also be aligned with Kudler's corporate objectives and performance goals.International Market JustificationKudler Fine Foods has chosen to further expand their retail grocery operations internationally. Through market research and environmental scanning, Kudler has identified Canada as a viable market to expand into. "If customers outside a firm's domestic market are willing and able to purchase its products or services, then selling into these markets will increase the firm's revenues," (Barney, 2007, p. 487). Beyond gaining new customers, accessing low-cost production and supply, gaining new core competencies, ease of entry into the market, and the stability of the local and national economy are key factors that influence Kudler selecting Canada as its market for expansion.Specific data garnered from research further supports the decision to expand internationally into Canada. From a population perspective Canada contains approximately 35 million people in the second largest global nation, geographically. This brings challenge to supply, logistics, and distribution but also provides a rich resource base for the country's economy to prosper. According to BMO (2010), the Canadian market shows strong growth trend in GNP of 3.0% and 2.4% in 2010 and 2011 respectively, while inflation is projected to rise 1.6 and 1.8 over that same period. Average housing prices have stabilized while household income continued to increase. For a retailer like Kudler, increasing household income is a key factor as it typically means more disposable income.More specific to the grocery market, the food distribution industry is Canada's second largest commercial sector. Member sales represent $71.8 billion in retail and $12 billion in foodservice. Members employ more than 428,100 Canadians, and represent over 85% of all grocery distribution sales in Canada. These are sound numbers that once again support the expansion of Kudler Fine Foods into the Canadian market (Wilkes, 2008).Domestic and International Markets Channel StrategyFirst the company should consider if there are any significant factors that should be addressed within the primary and secondary vertical...

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