The fact that Japan’s economy has been suffering from a recession for the last five years has not had much bearing on Hershey and Nestlé chocolates wanting to break into the Japanese market. Japan is no longer the third-largest economy in the world; Japan’s economic woes began in 2008 (Irwin, 2013). To break into the Japanese market these companies must understand the government and economic climate of Japan, while being aware of the taste and culture of the Japanese people. The Chocolate and Cocoa Association of Japan (CCAJ) reported in 2009 that Japan is the largest buyer of chocolate in Asia. “Japan produced 196,553 tons of chocolate with a manufacturer’s value of $38 million. About 19,375 tons were imported from the U.S., Australia, Belgium, China, South Korea, France, Italy, and Switzerland in order to meet the domestic demand of 212,657 tons” (World Cocoa Foundation [WCF], 2011). Even though, Japan is going through a downturn in their economy their appetite for chocolate has not wavered.
The decrease in business investment and global demand for the country’s exports in 2008 was the beginning of Japan’s hardships. The economy was on the way to a recovery in 2009 and 2010, but an earthquake hit the country 2011 this threw the manufacturing industry in to disarray. The country was on an upturn in 2012 by a surge of recovery spending, but slow economic global growth in the middle of that year took a toll on the demand of their exports. This decrease in the demand of their exports was further compounded by the fact that electricity supplies are a fraction of what they once were because the country shut down almost all of their nuclear plants; this was one of the aftermaths of the earth quake and tsunami that damaged the Fukus...
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...me for these companies to get in and claim their niche. Furthermore, Japanese consumers are willing to pay a top dollar for quality foods that come with the added benefit of healthy ingredients; Japanese consumers place a high importance in their health. For this reason Japan can be a goldmine for any company that markets high-quality chocolates. The per capita chocolate consumption rate of 1.67 kilos with an expenditure of about $82 per person is the largest in Asia. Pensioners in Japan (retired 55+) are the largest consumers of confectionery products and account for about 28 percent of consumption (World Cocoa Foundation [WCF], 2011, p. 1). Entering into a profitable relationship with the people of Japan is possibility for both Hershey and Nestle if researched correctly the ROI could prove bring a high return for both company’s external and internal stakeholders.
While Europe and the United States account for most chocolate consumption, the confection is growing in popularity in Asia and market forecasts are optimistic about the prospects in China and India (Nieburg, 2013, para 9). According to the CNN Freedom Project, the chocolate industry rakes in $83 billion a year, surpassing the Gross Domestic Product of over a hundred nations (“Who consumes the most chocolate,” 2012, para 3). If chocolate continues grow popular in Asia, it stands to become even more lucrative.
“His decision to focus on the production of the Hershey milk chocolate bar is now hailed as one of the most important decisions in the history of American business” (Milton Hershey 1). Certain aspects of Milton Hershey’s life are impossible to not take notice of. A simple chocolate bar completely changed the world of business, Milton S. Hershey impacted the world in a huge way.
The videos provided for this subject builds a great understanding on what happens behind the scenes and how the production cycle of chocolates turns deadly for few. The chocolate industry is being accused having legit involvement in human trafficking. The dark side of chocolate is all about big industries getting their coco from South America and Africa industries. However, it is an indirect involvement of Hersheys and all other gigantic brands in trafficking (Child Slavery and the Chocolate Factory, 2007).
Japan is currently in an economic recession. We can see that the value of the yen is falling; unemployment is rising, and purchasing of durable goods is down. This unhealthy state of economy has progressively become bleaker over the years.
Market research and information about the industry is very important to the organization because it will allow the organization to position itself well in terms of sourcing chocolate raw materials and in identifying the market for its products. For example, understanding that some chocolate product purchases are seasonal, e.g., at Christmas; around Mother’s Day; and, on Valentine’s Day, allows the organization to have more product on hand and to create displays, in store, that will increase purchases and attract more customers when existing customers tell their friends about the availability of high end products, at reasonable prices, in their store.
When moving to a market with a consumer culture so different from the home market, a company must be careful to analyse its target audience in detail, to avoid and costly cultural faux pas. To get a good feel for the Japanese culture, a good place to start would be the experts in the cultural studies field. Hofstede’s cultural dimensions, created during his in depth GLOBE study of the cultures of the world, gives a good comparison between the priority differences between Japanese and English culture. A detailed analysis of the cultural differences will be given in the ‘Marketing Issues’ section of the report.
Before Milton Hershey had a world wide known chocolate business, he had a small, not so well known caramel business. Milton Hershey began his chocolate making business in 1893, when his father and him traveled to Chicago to attend a big job fair (Tarshis 14), but it wasn’t until 1900 when Hershey succeed in making the first milk chocolate candy bar (The Hershey Company). Hershey attended an exhibit hall of new and amazing inventions around the world at the fair in Chicago. As Hershey walked into the exhibit hall, he was struck by a delectable smell (Tarshis 14). “Hershey was already a leading candy maker. He had created the largest caramel factory in the country, but he became convinced that the future of his business would be chocolate. At the fair in Chicago, Hershey Bought chocolate-making equipment. He had it shipped back to his caramel factory in Pennsylvania. Then he hired two chocolate makers. Soon the company was churning out chocolate candies in more than 100 shapes” (Tarshis 15).
Chocolate companies changed from minimal production to massive manufacturing. Thus, targeting different market segments that weren’t possible to reach due to the high cost of the good. The market was able to shift because of the industrialization process that includes several innovations, such as van Houten’s process, this allowed a broad production and distribution of chocolate that spread around the globe.
With the knowledge base of the Japanese managers, which helps the business continue to grow and the local responsiveness that Baskin Robbins incorporates in their entry to market process it proves that Baskin Robbins has a competitive edge in their market space. Another factor that shows that Baskin Robbins has a competitive edge is because they are strategic thinkers. When they first entered Japan 37 years ago they merged with a local company called “Fujiya” which made it easier to enter the Japanese market base. Baskin Robbins thought of different ways to appeal to the customer base and kept in mind that in different countries there are many different techniques. In Japan, Baskin Robbins also has to compete with the local companies so they have to make sure they capture the essence of
It is quite obvious that Japan’s government needs to invest in social capital,and thus they need to review their budget allocated for investment; that they need to make it their priority until the country is recovered to get ‘back on track’. With investment in repair of roads and all other transport systems, investment in power supply and renovation of buildings, Japan will be able to compensate for the loss of revenue from exports they have made during the crisis.
Japan's economy went through stages of prosperity and depression. During the 1950- 1973 years Japan's economy has experienced a rapid growth period. Then the economy slowed down until the end of the 1980s. After the 1980s, japan suffered from an economic crisis for a decade. This decade is know as the “Lost Decade”. Some say you have to know your past in order to see your future. In this essay I will discus the major issues from from the past and present within the Japanese economy. These issues is what cause Japan to become the fourth largest economy in the world.
Export trends have been an important factor during Japan's present economic adjustment period, and the structures of Japanese exports, together with the imports, have been changing substantially in recent years. The changes in the country's export and import structures during the 1990s can be characterized by the following three key developments: (1) the weight of IT-related goods has been rising in both real exports and imports; (2) real imports of consumer goods from East Asia has been increasing; and (3) the US remains Japan's largest trading partner as a single country. Due to these factors, maintaining its comparative advantage became the priority in the current global economy.
The market can be further divided according to gender because both men and women have different tastes (chocolate shapes, packaging, and type of liquor). It is known that women are already consuming chocolate. In fact, the numbers of women that consume chocolate far outnumber the numbers of men that consume chocolate. It follows that there is a ready market for the commodity in question. Nonetheless, the reality that introducing alcohol to make liquor-filled chocolates increases the market.
Nestle is a Swiss food and beverage Multi-national corporation headquartered in Vevey, Switzerland. It is the largest food company in the world measured by revenues with about 500 factories in more than 80 countries. The company consists of a powerful portfolio of brands that is driven by unrivalled research and innovation, an aim to contribute to improving the quality of consumers’ lives and a clear commitment to consistence excellence. The company succeeded in accomplishing its mission of “Good Food, Good Life” by making the use of globalization in the areas that are as follows-