Entry Methods into Chennai

In this day and age there are multiple different ways in which you can enter into a foreign market, however theres only a few which should be considered when talking about our products at OCHO Chocolate. In this case these are Direct Exporting, Piggy Backing and also Partnering. I feel as though these options may not seem like the most exciting options, but they all have their positives and negatives which I will get into further.

Direct Exporting is when you sell directly into a market you have chosen using only your own resources. To put this in terms with us at OCHO Chocolate this means that we would continue making our chocolate and products here in New Zealand, and then ship our products over to Chennai and have some sales agents selling them over there to companies. We would have to have an office over in Chennai as well, so that we could have somebody on the ground over there making sure orders are being delivered to the right places, and also so there someone businesses can easily access if / when problems occur. This way would mean essentially that we get all of the profits, as there is no middle man or partner in which we need to pay. However, I feel as though this isn’t the best way to enter the market in Chennai for us, and heres why. I feel as though this way will be far more expensive than the other two, as we will be having to ship our goods over from New Zealand which is a cost which could be avoided. Also we have this risk of our product being damaged while travelling over, or even or product having other things happen to it which ultimately downgrade our usual high standard. Since we are not quite an established and hugely successful brand yet, we don’t need to have unnecessary risks which could ultimately put is way behind where we already were. This is why I feel this is not the right option for us.

Piggy Backing is when a company approaches another company which is already established in international markets and see if their product can be included in the already established companies inventory. This would work well for us at Ocho Chocolate, as this method allows us to have not much risk in terms of losing money as our costs will be much lower. It will also be a great way to enter the market internationally as we would be able to partner up with a big company in India, say Nestle for example, and they would be able to start producing our product or at least stock it for us. However, I feel as though this method is not the way in which we can best succeed at OCHO Chocolate. This is because, for all the less risk which we are doing by going this direction means that essentially we will also be losing a lot of revenue, as the company we are working with will command a hefty percentage as they are essentially doing most of our work. There is also no way to know that the other company won’t eventually copy our idea and start selling a product very similar to ours. This is why I feel this isn’t the best way for us.

Partnering, (which I feel is the best way for us to enter the market in Chennai), is when there is something like a co-marketing arrangement or a strategic alliance for manufacturing, which would be very useful in terms of India. This strategy is useful for companies which are from a different culture, and that the partnering company will be able to help with this as they will be familiar with the market which we are looking to enter. In our case, this entry strategy would be perfect for us as we would be able to keep our principals of still purchasing cacao beans from the Pacific Islands at a fair price and other principals, while also getting the help we need in terms of how to get into the market of Chennai. We may even be able to do our manufacturing with a big company, such as Nestle, in India, as they would make our chocolate how our recipe says, cacao beans bought fairly and all. We would have to have somebody on the ground over there to make sure all these things go smoothly and the standards we are after are still being met, which can be done. This is why I feel as though this is the best strategy of entry.