Tavazo Case Solution And Analysis, HBR Case Study Solution & Analysis of Harvard Case Studies

Tavazo Case Solution

Threats

They lack of knowledge regarding retailers in new markets can lead the company towards failure in new markets.

The threat of future and current imitators, which tends to-negatively affect the perception of customers regarding the quality of the company’s products.

The time length needed to harvest the nuts from tress is high, which makes it difficult to predict the business’s future.

Exchange rates fluctuate rapidly in the international markets, which is a threat for the companies that wish to expand their growth in the international markets.

Trade wars and supply restrictions imposed by different countries, can negatively impact the business in foreign markets.

The production level of fruits and nuts is not consistent;therefore, the prediction of sales and profit is also not consistent.

External Analysis

PESTEL/Porter’s Five Forces

Competition in the Industry

There are just a few rivals of Tavazo in the market, which is why the business competition is not much intense. However, in Iran, some of the Tavazos' imitators try to attract customers by claiming that they are original Tavazo, but these imitators do not have any reach to the Canadian market. In wholesale, few companies in Canada do have the potential to be the company’s competitors, but overall it has very less rivals.

Potential of new entrants into the industry

The potential of new entrants into this business is also low; as the company already has a huge base of loyal customers and suppliers, and new companies cannot compete with Tavazo in quality.

Power of Suppliers

The company’s suppliers play a key role behind its success. Tavazo has a strong network of loyal suppliers; the bargaining power of suppliers is high, which is the strength of this brand.

Power of Customers

Tavazo has loyal customers and the company is known to provide value in quality over price, and there is an increase inthe demand for pistachio, globally.

The Threat of Substitute Product

The substitution of Tavazo’s products is low, as the customers are satisfied and they rely on the quality of its products. Some competitors can substitute dried fruits, but they will lack in quality as compared to Tavazo.

Alternatives:

Alternative-1

The Geographic expansion to Vancouver, Dubai and Los Angeles.

Pros

When the company will expand its business in these cities,it will find new markets and get new customers where it can diversify the risks of uncertainty in the Iranian economy. The company has vast experience of operating business in Canada, where it has gotten a welcoming response.The largest population of Iranians lives in Los Angeles city and a number of Iranian traveling to Dubai is higher, this indicates that the business expansion is very possible in these cities.

Cons

The startup cost to expand business in these cities would be very high as these cities are among the most expensive cities around the world.

There are political and economic risks associated with expansion in these markets.The United States seems to respond less to these Iranian products. If Tavazo relies just on the Iranian diaspora, it would face demand issues while operating in multicultural cities.

Alternative-2

Further expansion in new markets, while focusing on value chain.

Pros

Further expansion in the new markets of the world, will provide new customers to company, enabling it to have an access to new markets, and it can increase its profit and sales through accessing the international markets.

Cons

The company would face economic and political risks when expanding to other countries or markets. There is a risk of failure associated with the company selling its products to only the Iranian community, when there is higher possibility that the company would not get the same response as it does in Iran.

Alternative-3

Expand into current wholesale/retailer activities in Iran and Canada:

Pros

The company can easily expand further in Canada and Iran through the market penetration, as it is already successful due to the high increasing Iranian communities in these countries. The reputation of the company is already known in Canada and Iran, so it does not have to invest in marketing and other relevant activities to attract customers.Besides, there are no significant competitors of the company in Iran and Canada, which is an opportunity for it to grow and capture the huge markets, to generate more profit and sales. Due to the political and economic stability; there are no risks associated with trade in Canada, so the company can expand further in these countries through good marketing campaigns.

Cons

The company has only two retail stores in Canada, difficulties of retail store in Canada shows the company’s is lacking competency in foreign markets to deal with retail stores. However,through proper marketing strategies; the company can expand rapidly in Canada, as the demand for its products is increasing rapidly.........................

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Tavazo Harvard Case Solution & Analysis