The United Kingdom Beverage Market Essay

1819 words - 7 pages

The United Kingdom Beverage Market

INTRODUCTION

Armstrong Corporation is a food products manufacturing company, with
products which include ready-to-eat cereals, frozen pies, snack items
and carbonated beverages. Funky-Cola is the flagship brand of the
carbonated beverage division. Our company has decided to introduce
Funky-Cola to the United Kingdom beverage market. In this paper, the
market potential and opportunities of the country would be
investigated in order to affirm our decision to enter into the UK
market.

Funky-Cola has been doing very well in our Malaysian market. Our
company’s sales in the year 2003 amounted to over RM2 billion, with
Funky-Cola contributing 25% of the overall revenues. Because of this
strong performance, our company believes that Funky-Cola has the
potential to be successful in a foreign country. We have pooled
together our company’s resources to make a thorough research on the UK
market and the R&D department is working towards extending our product
line in order to adapt to the country’s market.

With our successful past performances, we believe that our company has
enough resources, in terms of capital and managerial expertise, to
form a wholly owned subsidiary company in UK. This subsidiary company
would mainly produce Funky-Cola for the UK market.

COUNTRY ATTRACTIVENESS

Our company chose to enter the UK market because of its potentials and
opportunities. According to a research, the market for the drinks
bought by Britons is worth an estimated £51.85 billion in the year
2004, which makes UK the world’s tenth biggest cola market. The
research also revealed that 7.2% of all consumers spending are spent
on purchasing drinks and Britons drink 130 cans of soft drinks or
43litres per year.

However, Britons are moving towards consuming different kind of
drinks, such as squashes, diet colas, energy drinks, tea and so
forth. There is also a new breed of health conscious male consumers
in the UK. This was due to the increased focus on obesity by the
government and media. Therefore, Britons have decreased the frequency
of consuming cola drinks. Our company sees this as an opportunity to
revive the cola market by producing fusion drinks which combines the
traditional cola with the new preferred drinks of Britons. This would
satisfy the UK consumers’ need to stay healthy, and at the same time,
continue to enjoy the great taste of cola drinks.

ANALYSIS

Internal Factors

Armstrong Corporation has been operating in Malaysia since the year
1994. Since the beginning of its operation, Armstrong Corporation
strives to be the pioneer provider for new or latent needs of
Malaysians. Our products, from ready-to-eat cereals to frozen pies,
as well as our flagship brand Funky-Cola have been very well received
by our local consumers. Funky-Cola was the highlight of our
company’s performance by contributing 25% of overall revenues. Our
company introduced Funky-Cola as a tasty and fun drink that brings out
the funkiness in each...

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