Case Analysis- Tetra Pak versus Greatview: The battle Beyond China Harvard Case Solution & Analysis

Case Analysis- Tetra Pak versus Greatview: The battle Beyond China Case Solution

Tetra Pak was the market leader in aseptic processing and packaging of food and other perishable goods. The company was the market leader and had almost 90% of the overall market share in the Chinese region. The company was working in the region for decades and was earning an attractive profit. However, another company, Great view, which was a Chinese company, entered in the same industry and started threatening Tetra Pak since the company started to offer alternative products, on which Tetra Pak competed on the basis of quality and prices.

Moreover, Tetra Pak was not a local company and it had many competitive strategies, such as it had registered numerous patents and had other intellectual property rights etc. Despite this, the company was facing troubles in competing with the newly entered local competitor. This battle did not end here; the local competitor earned a huge profit from the Chinese market and started to compete with the company in its home market of Europe by starting its business in Germany. Therefore, the company now has several challenges, not only in the Chinese market, but also in the European market

PEST analysis

Political Factors

The political factors in the Chinese region are trade friendly since the government of China offers suitable business policies, which allows different companies export their goods to other countries without paying any heavy duties or taxes. Moreover, the Chinese government does not have any restrictions on its import of raw material. Therefore, raw material can be procured from different parts of the world. Finally, the main focus on which the government restricts the corporate sector is that the government is closely working to reduce the carbon emission and due to this, the government restricts companies from working in a sustainable way.

Economic Factors

Economic factors are quite favorable in this region since the market size is large enough and the population of this region is above billion, among which, majority prefer Aseptic processed food or packaging that can preserve goods for a long time, this factor is therefore quite favorable for Tetra Pak’s industry. Moreover, the purchasing power is sufficient through which the people of the region can easily afford above average prices. Furthermore, the economy of China is strong enough and it’s still growing because of the large amount of forex earnings from exports, manufacturing, and overseas operations. Finally, the overall economic conditions of the region are quite favorable.

Social Factor

The social factors of this region are in deep favor of aseptic processes products since the lifestyle of the country is very busy, people usually buy commodities in large quantities and store them for several days under these conditions. Tetra Pak’s industry has a wonderful chance to grow its business and to explore more packaging options. Furthermore, the literacy rate of the country is over 90%, which represents a large market for this industry. In a nutshell, the overall social factors of the country are quite favorable for the industry.

Technological Factors

These factors are very difficult to cope with, especially for the Aseptic processing industry because the pace of technological change is very high in the Chinese market; there are new technologies, which are being introduced on almost daily basis. However, the industry members are also following a same trend, but this factor is quite costly for them. In addition, the purchasing trend in the region has also changed from physical buying to online shopping. While the distribution methods have also been changed, using the latest technology. Conclusively, whether the technological factors are favorable or unfavorable depends upon the capacity of the company to stay either updated or outdated. (Mindtools, 2016)....................

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