MGT 405 Lavazza Coffee Modes Of Expansion
ANSWER QUESTION 2 (bolded): Questions 1-4 are provided to help. Length of answer should be similar to those answered in 3 and 4.
Assess the firm’s current approach to international growth (or what should it be if it is currently not global) and how it balances the dual needs of standardization and localization
Assess its mode of expansion (JV, wholly owned etc.)
3. What are the benefits for the firm if it does conduct activities globally? (Describe the activities and benefits)
MGT 405 Lavazza Coffee Modes Of Expansion
Lavazza, as a global coffee company, can benefit in several ways by conducting activities globally. Here are some activities and benefits that Lavazza can achieve:
Increased market share: Lavazza can expand its business activities globally by entering new markets, targeting emerging economies and offering its products and services to a wider customer base. This can increase the company’s market share and provide additional sources of revenue, creating opportunities for long term profitability.
Diversification: by conducting activities globally, Lavazza can diversify its product offerings, reduce its dependence on any one product line or market and capitalize on a broader range of opportunities. Indeed, by introducing new products, such as coffee blends that cater to local preferences, Lavazza can capture new markets and increase revenue.
Access to new technologies: Lavazza can gain access to new technologies by conducting activities globally. For example, the company can partner with research institutions and technology companies to develop new coffee brewing or roasting techniques that can improve the quality of its products. Lavazza can also leverage new technologies, such as e-commerce platforms, to expand its online sales and distribution channels, and improve its supply chain management.
Brand recognition: conducting activities globally can help Lavazza to build brand recognition and increase its global reach. Lavazza can create targeted marketing campaigns that promote its products and services to different regions, demographics, and cultures. Moreover, partnerships with other companies, such as airlines or hotels, can help to expand the brand’s reach and increase its visibility.
Economies of scale: Lavazza can take advantage of economies of scale, which can result in lower costs per unit and increased profitability. For example, the company can produce coffee beans in larger quantities, which can reduce the cost of raw materials and improve profit margins. By building a global network of warehouses and distribution centers, Lavazza can also reduce transportation and storage costs.
Talent acquisition: Lavazza can attract and retain talented employees with diverse backgrounds and perspectives. For example, by opening new offices or stores in different regions, Lavazza can hire local employees who have a deep understanding of the local culture and customer preferences. This can help Lavazza to create a more diverse and innovative workforce that can drive growth and enhance customer satisfaction.
Competitive advantage: Lavazza can gain a competitive advantage over other companies in the coffee industry. For example, by entering emerging markets, Lavazza can establish a lead before its competitors and capture market share before the market becomes saturated. Furthermore, by expanding its product offerings and improving the quality of its products, Lavazza can differentiate itself from its competitors and create a strong brand reputation.
In conclusion, conducting activities globally can provide Lavazza with a range of benefits that can help the firm to grow its business and remain a leading player in the global coffee industry
4. Do they have the necessary management skills?
Lavazza is a company that has been in business for over 125 years, and during that time, they have developed a strong reputation as a leading coffee brand worldwide. The company has been successful in expanding its operations globally and has established a strong presence in over 140 countries. This success would not have been possible without effective management skills.
One of the key management skills that Lavazza possesses is a strategic vision. The company has a clear sense of direction and has been able to anticipate trends and changes in the market, adapting accordingly. For example, they have focused on sustainability, quality, and innovation, which has allowed them to remain competitive in a crowded market.
Another critical management skill that Lavazza has is effective communication. The company has been successful in communicating its values and mission to both employees and customers. This has helped them to create a strong brand image and a loyal customer base. Additionally, Lavazza has a reputation for treating its employees well, which has led to high levels of employee satisfaction and retention.
Lavazza also possesses strong leadership skills. The company’s leaders have been able to inspire and motivate their employees to achieve their goals, while also providing guidance and support. They have created a culture of innovation and creativity, which has led to the development of new products and services.
Finally, Lavazza has a commitment to continuous improvement. The company is always looking for ways to improve its operations, whether it be through new technology, processes, or training. This commitment to improvement has allowed them to stay ahead of their competitors and to continue to grow and expand.
In conclusion, Lavazza has demonstrated effective management skills, which have contributed to their success as a leading coffee brand worldwide. Their strategic vision, effective communication, strong leadership, and commitment to continuous improvement have allowed them to remain competitive in a crowded market and to establish a strong brand image and loyal customer base.