crossing the pacific

Crossing the Pacific“Stanley Wines for everyone”

Humberto Pedro Miramontes

Gabriela Galvez Chico

Carmen Castillo

Alejandra Lanzagorta

Basic Strategy

Based on Michael Porter´s theories our strategy consist of entering the mexican low-to-medium wine market agressively with a focused entry based in Mexico City, taking advantage of the vast distribution network available.

The Companies

Getting to know the company

Today the Stanley Wine Company is proud of being one of the lowest cost producers in the Australian wine industry. The Stanley cask is an Australian icon, being enjoyed by many Australians every year on a multitude of occasions.

Creating a Joint Venture

Pascual Boing is a mexican soft drinks company. It is one of the few Mexican worker-owned companies that have national presence, even making inroads into the United States and Central american market. Currently they have several plants and warehouses in Mexico.

Market Analisis

Analizing the Mexican Market

Population: 110 million GDP per capita: $9,100 74 percent urban; under 20: 44%

Wealthy/Upper Middle: 23% Middle Class: 37% Poor: 40% GDP Composition: Services 62.2%, Industry

34.1%, Agriculture 3,7% http://www.buyusa.gov/mexico/en/doing_business.html

SWOT Analisis

Strenghts (internal): Stanley wines are a well known and

successful product in Australia It will be an innovative and new concept

in Mexico in the first stage of the product cycle model

Cheap prices of product

Oportunities: Scarce direct competition Possibility for generic recognition Good relations that facilitate trade

between both countries Big target market (77% of the

population)

Weaknesses: Uncertainty of product success Altering consumers lifestyle and

traditions

Threats: Financial crisis: 55% reduction of

foreign direct investment on the first trimester of 2009

Current swine flu spreading

Wine industry in Mexico

Gap Minder

http://graphs.gapminder.org/world/#$majorMode=chart$is;shi=t;ly=2003;lb=f;il=t;fs=11;al=30;stl=t;st=t;nsl=t;se=t$wst;tts=C$ts;sp=6;ti=2004$zpv;v=0$inc_x;mmid=XCOORDS;iid=pyj6tScZqmEdIyrBS31XAaw;by=ind$inc_y;mmid=YCOORDS;iid=phAwcNAVuyj0XOoBL_n5tAQ;by=ind$inc_s;uniValue=8.21;iid=phAwcNAVuyj0XOoBL_n5tAQ;by=ind$inc_c;uniValue=255;gid=CATID0;by=grp$map_x;scale=lin;dataMin=1.12;dataMax=12$map_y;scale=lin;dataMin=0;dataMax=1458024460$map_s;sma=49;smi=2.65$cd;bd=0$inds=i143_t001984,,,,

MEXICO, A GREAT PROSPECT FOR THE FUTURE

With a total population of 110 million people , Mexico represents a big opportunity for us given the importante of its economy, being the 2nd larges economy in Latin America and the 9th at an International level.

Important Facts

The supply for wine in Mexico for national produccion and imported produccion has grown on the past few years.

There is more demand for imported wine than for national wine.

The total wine imports in 2005 consisted in 81.295 million dólares being Spain, Chie, France, US, Italy, Germany, Australia, Argentina, Portugal and Uruguay.

The total wine imports in litres in 2005 ascended to 20.165.665 litres, 19% more than in 2004.

The general consumption of wine in Mexico is of 500 ml per capita.

The tendency for wine in Mexico has rise 60% since 2001.

Acting on experience: Porter´s diamond

Firm strategies, structure and rivalry

FactorConditions

Related and supporting industries

DemandConditions

Firm strategies, structure and rivalry

FactorConditions

Related and supporting industries

DemandConditions

Strategies

Distribution

Outsource the distribution, creating a joint-venture with Boing S.A. de C.V

Distribution Strategy

Marketing

We are going to attack the market using bilboards on urban and rural areas, and instore ads

Marketing Strategy

In store ads:

Storage

The containers arriving to Port Lazaro Cardenas will be directely transported to the Boing storages in Mexico city.

Storage

Implications

Government

According to the Australian Government, whilst Mexico and other Central and South American countries (e.g. Chile) already boast high wine production levels the Australian wine industry has indicated there is potential for some expansion of Australia's wine trade to the Central American Region at the low to medium price point of the market.

http://www.aph.gov.au/house/committee/jfadt/mexico/subs/sub13.pdf

FIESTA ! FIESTA!

Luxury for everyone..

Investment

Stanley Wines Financials (In millions of USD)

Income Statement Q1 (Feb '09) Annual

(2009) Annual

(2008)  

Total Revenue 735.10 3,654.60 3,773.00  

Gross Profit 191.20 1,230.00 1,281.50  

Operating Income -286.90 23.00 -356.70  

Net Income -406.80 -301.40 -613.30  

Balance Sheet  

Total Current Assets 2,534.50 2,534.50 3,199.00  

Total Assets 8,036.50 8,036.50 10,052.80  

Total Current Liabilities 1,326.40 1,326.40 1,718.30  

Total Liabilities 6,128.20 6,128.20 7,286.90  

Total Equity 1,908.30 1,908.30 2,765.90  

Cash Flow  

Net Income/Starting Line -301.40 -301.40 -613.30  

Cash from Operating Activities 506.90 506.90 519.80  

Cash from Investing Activities 128.60 128.60 -1,112.90  

Cash from Financing Activities -647.40 -647.40 584.90  

Net Change in Cash -7.40 -7.40 -13.00

Sources

http://www.pascual.com.mx/index_home.html http://www.aph.gov.au/house/committee/jfadt/

mexico/subs/sub13.pdf http://www.buyusa.gov/mexico/en/doing_busi

ness.html http://www.google.com/finance?q=NYSE:STZ