The United Kingdom Beverage Market Essay -- Business and Management St

The United Kingdom Beverage Market INTRODUCTION Armstrong Corporation is a food products manufacturing company, with products which include ready-to-eat cereals, frozen pies, snack items and carbonated beverages. Funky-Cola is the flagship brand of the carbonated beverage division. Our company has decided to introduce Funky-Cola to the United Kingdom beverage market. In this paper, the market potential and opportunities of the country would be investigated in order to affirm our decision to enter into the UK market. Funky-Cola has been doing very well in our Malaysian market. Our company’s sales in the year 2003 amounted to over RM2 billion, with Funky-Cola contributing 25% of the overall revenues. Because of this strong performance, our company believes that Funky-Cola has the potential to be successful in a foreign country. We have pooled together our company’s resources to make a thorough research on the UK market and the R&D department is working towards extending our product line in order to adapt to the country’s market. With our successful past performances, we believe that our company has enough resources, in terms of capital and managerial expertise, to form a wholly owned subsidiary company in UK. This subsidiary company would mainly produce Funky-Cola for the UK market. COUNTRY ATTRACTIVENESS Our company chose to enter the UK market because of its potentials and opportunities. According to a research, the market for the drinks bought by Britons is worth an estimated  £51.85 billion in the year 2004, which makes UK the world’s tenth biggest cola market. The research also revealed that 7.2% of all consumers spending are spent on purchasing drinks and Britons drink 130 cans of soft drinks or 43litres per year. However, Britons are moving towards consuming different kind of drinks, such as squashes, diet colas, energy drinks, tea and so forth. There is also a new breed of health conscious male consumers in the UK. This was due to the increased focus on obesity by the government and media. Therefore, Britons have decreased the frequency of consuming cola drinks. Our company sees this as an opportunity to revive the cola market by producing fusion drinks which combines the traditional cola with the new preferred drinks of Britons. This would satisfy the UK consumers’ need to stay healthy, and at the same time, continue to enjoy the great taste ... ...cost differentiation strategy. From research, the standard cola price in retail outlets are as follow: a) 330ml can -  £0.39; Our price -  £0.30 b) 2litre bottle -  £1.32; Our price -  £1.25 c) 1.25litre bottle -  £1.09 Our price -  £1.00 REFERENCES Red Bull’s Place in the UK Soft Drinks Market http://www.bized.ac.uk/compfact/redbull/redbull11.htm BBC News – Business â€Å"Cola Sales Set to Lose Sparkle† http://news.bbc.co.uk/1/hi/business/3121690.stm Coca-Cola Britain – Using Market Research to Develop Product Range http://www.thetimes100.co.uk/case_study.php?cID=3&csID=108&pID=1 Diet Soft Drink Battle Heating Up in UK http://www.beverageworld.com/beverageworld/index.jsp Drinks Market – UK – Beverage Market Research from Key Note http://www.just-drinks.com/store/products_detail.asp?art=32671&lk=rotw_arch Birmingham – Wikipedia, the Free Encyclopedia http://en.wikipedia.org/wiki/Birmingham United Kingdom – Wikipedia, the Free Encyclopedia http://en.wikipedia.org/wiki/United_Kingdom West Midlands Directory of Health, Sports, Fitness & Leisure Clubs http://www.health-club.net/w-midlands.htm Sainsbury to You – Price Check http://www.sainsburystoyou.com/index.jsp?bmUID=1115818459144