Case Questions: 1. Philip Austin’s plan for European expansion is very simplified and will rely mostly on the foreign intermediary to complete export and complete sales transactions. I believe that this is the main problem of this expansion plan; there is too much liability in someone outside of the company that possibly doesn’t share the same goals and objectives of the company and sometimes is not completed committed with the process. There are some important issues to consider when dealing with intermediaries on an exporting process: First of all the company would need to identify the appropriate commission structure for compensating intermediaries, which sometimes might lead …show more content…
Also Barrett should consider organizational strengths; their reputation among consumers and if they have important connections with influential people in the country and with the government. Also the intermediary knowledge about the products is very important, and how well can they sell it? And also another important factor to analyze is if the intermediary also sells competitors’ products and if they are willing to have exclusivity with Barrett Foods in the food business.
In terms of financing, the best way to perform international transactions like that is by hiring an international bank services to manage the financial operations, so they can make sure that they get paid by their products. The payment transaction should be made through a letter of credit between Barrett’s bank and the importer’s bank. 5. In order to compete successfully, Barrett should come into each country in Europe prepared to win, outworking the competition and gaining market share. In order to do so, first of all they need to make sure they choose the right partner; the one that is influential and will open the market for Barrett’s products in the country. Also Barrett needs to make sure that their products is compatible in terms of price and quality, and at the same time adapted to Europeans’ needs, tastes and preferences.
6. The food industry in Australia has great significance in terms of its contribution to the national economy, its crucial