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There are two ways which H4Y can use to enter the Cambodian market. The company can either choose to partner with the Cambodian government or go through the independent investments. In case that the company chooses to partner with the government to provide the vitamin health products, it is worth noting that ownership will be shared in a ratio agreed upon. The main advantage attributed to this mode of “entering the market” is the fact that the products will access the ready demand, and there would be a possibility that the Company could start making profits, as soon as it enters the aforementioned market. Also, it is assumedly clear that the Company can commence with its operations quickly, since required procedures will be taken care of by the government and by that be allocated a favorable place upon which to conduct its activities.
The Company can also be protected from the external competition, taking into account that in both Australia and New Zealand markets it faces the stiff competition from the American-based company. Long-term contracts that will be made between the entity and the government will cut-down on costs attributed to the inherent risks involved.
In order to support the aforementioned probability of partnering with the government, there lies the fact that the country experiences healthcare plight and opportunities to provide health-related products to the ever-growing population is of the core significance.
In case the Company embarks on conducting its activities independently, it would mean that it would be forced to enter the market competitively. This means that it will undergo a thorough registration scrutiny with the Committee of Company Registration within the Ministry of Commerce and acquire a certificate for conducting operations. Advantages attributed to this mode of entry are full of ownership of the Company, full profits, as well as the whole decision-making functions. However, the Company is prone to the external competition, inherent costs, due to risks involved, as well as possibility of closure, due to the lack of demand for the products.
It is safe to postulate that the market size for Cambodian based products is on the increase. This increase is based on two facts which are population increase, as well as the willingness of the government to enter into future trade agreements. The population of Cambodia is depicted as increasing, since the government is on a strategy to replace the workforce which was lost in the course of the civil war. In terms of the development, the country is putting up with each and every opportunity that avails itself for the purpose of promoting trading activities. In recent years, the government was perceived to foster the trade opportunities that were going to result from such organizations, such as World Trade Organization (WTO). The country becomes the first South-East Asian country to join the organization which depicts its efforts for the development. In this case, it is safe to assume that the marketing strategies for H4Y are going to be affected to fit in with the advanced changes meaning that advertising campaigns will be formulated to reach a wider market, such as the ASEAN market, as well as that of the local consumers. Strategies, such as educational campaigns, are the most appropriate for the local customer, as well as the engagement in corporate social responsibility in order to gain the popularity it needs from people.
The possibility of the market widening means that the demand for the product is going to increase, as well. In this case, H4Y is expected to tap a portion of the increased marketing niche by investing on manufacturing processes, as well as raw material management. In terms of material management, the Company can resort to sourcing most of its raw materials from the local population.
The Strategy which involves including the local population into providing materials will not only cut costs, but also increase the loyalty from customers who will provide the ready market for locally-produced products. In terms of manufacturing, the company is expected to increase its production base to other manufacturing points within the area to supply the products to the local communities, as well as neighboring countries within the South-East Asian region. The skilled labor market, as well as the affordable cost of capital, are items which will facilitate the success of the process altogether.
According to the statistics provided by the National Institute of Statistics (2005), the immediate approximation of infant mortality rate is attained by determining the ratio of the number of deaths which occurred under the age of one to the number of fortunate births in a period not exceeding 12 months. Statistically, 58 infant death rates are posted per 1,000 of fortunate births.
The birth rate for the period between 2004 and 2008 census was 734 and 769 live births per 1,000 of births posted. Taking the average: (734+769)/ 2, the figure amounts to 751 live births for every 1,000 births (NIS, 2005).
The Cambodian health market is considered to be an opportunity to exploit. This is because of the ease with which the government conducts registration of companies. Foreign investments are encouraged by the government, since the country is an emerging economy and growth and development are its main goal. The country underwent a substantial period of civil war which destroyed the economic stability and with this; the country is in need of effective health services to provide to its ever-growing population mainly made up of children.
In terms of infrastructure, Cambodia is placed fairly in the ASEAN region and this can be used as an opportunity for expansion and growth. The fact that the government is open to trade agreements makes it easier to import goods and services. This can be used by H4Y to its benefits, since it will increase profits as taxation costs are relatively low.
Therefore, it is safe to postulate that H4Y can enter the Cambodian market to provide vitamin-related products, since the demand for the product is high. The best methodology is to enter the market independently, mainly because the Company is well established and can tackle competitions efficiently. Further, there is a room for the future growth and expansion to other neighboring regions since the country assumes the trade agreements.
To sum up, Cambodian government has embarked on strategies which promote Foreign Direct Investments (FDI) through lowering of costs involved with promoting of trading activities, providing favorable investment environments, as well as improving exports-based development strategies.