Table of Contents 0
Objectives and Goals 2
Franchising in Brazil 4
Macro Environment in Brazil 9
Industry Analysis 15
Organizational Value Chain Analysis 17
Market Entry Strategy 21
Marketing Mix 22
Action Plan 26
Appendix A: Comparing Brazil with India & China 35
Appendix B: Hofstede’s Cultural Dimensions 36
Appendix C: SWOT Analysis 37
Appendix D: Time Line 38
Appendix D: Budget 39
Mountain Equipment Co-op (MEC) is a Canadian cooperative, which sells outdoor recreation gear and clothing to its members exclusively. As a co-op, MEC sells only to customers who hold a lifetime membership, which is a share of the company with voting rights and can be purchased by anyone for $5. MEC prides itself on being Canada’s largest supplier of outdoor equipment. Since its founding in Vancouver, British Columbia in 1971, MEC has expanded across Canada and now operates in 14 cities. Sales in 2010 were $262 million, significantly more than even 10 years ago (MEC, 2010). Currently members can shop at any retail store, online, or by mail order from their catalogue. MEC is notable for its commitment to environmental protection, every year the company donates 1% of gross revenue to environmental causes. A few of the retail stores even comply with Canada's C2000 Green Building Standard, which acknowledges buildings that achieve a 50% reduction in energy consumption over conventional structures.
MEC distinguishes itself from other outdoor retailers through its eco-friendly product line and intensive focus on corporate social responsibility. The company is noted for their ethical sourcing, labour commitments, co-operative structure, and innovation in sustainability. The co-op designs and produces the majority of its gear, although it also carries products by many other well-known companies. A significant proportion of the company's inventory is manufactured abroad in Asia although they have six contract factories in Vancouver. This allows it to have some control over quality and price issues, placing it in a superior position in the eyes of its customer base. Furthermore, directed by the members, MEC fulfills its core purpose: to help people enjoy the benefits of self-propelled wilderness-oriented recreation. They accomplish this by selling high quality outdoor gear, clothing, and services.
Objectives and Goals
MEC’s decision to develop internationally is based on their desire to further expand their operations outside of their current market. At present, the co-operatively run company is located solely in Canada. Although, MEC provides an online shipping service, the company focuses primarily on exclusively supplying their members through the traditional brick and mortar design (Strashok, 2011). Expansion into international markets would fulfill a number of key objectives that would bring global recognition to this already successful Canadian company.
Global expansion to other economies would increase MEC’s ability to grow their brand by broadening their market. As previously mentioned, MEC only operates in Canada and, as a result, the company’s economical situation relies heavily on the Canadian market. With the recent turn of events such as the economic downturn, specifically within the Canadian economy (Sancya, 2011), MEC’s only market has suffered. Expansion into international markets could help balance the negative implications of a global recession by offering another market to operate within. This would reduce the dependence on the domestic market during an economic slump by spreading operations to markets ready for further foreign investment.
Recognizable Global Brand
By broadening the markets in which MEC operates, global expansion would also facilitate building a more recognizable brand, thus improving the brand value while promoting MEC’s vision globally. As one of Canada’s largest co-operatives, MEC