Exporting Razors to Canada

¶ … international business plan. The plan will be for Acme Corporation. The plan will be to export manual razors (non-electric) from Acme's home country of the United States to Canada. The next section, that being the executive summary, will list the different sections of this report and in the order they will be listed.

There will be numerous sections of this report. They will include an introduction, a situation analysis, an export marketing plan, several market screenings, export marketing strategies, the export financial plan and the export performance evaluation. The author of this report would flesh out the "market screenings" as there are a total of five of those. The first screening will be the basic need potential. The second screening will be financial and economic forces. The third screening will be political and legal forces. The fourth screening will be sociocultural forces. The fifth and final screening will be competitive forces.

Introduction

Acme Corporation has a solid business base within the United States and it continues to grow in a health and steady fashion. However, the authors wish to expand into new countries and the two closest ones would be Mexico and Canada. While they are both immediately bordering the United States, Canada's economy is more advanced and more similar to the United States. As such, there will be exports to that country first. Mexico could be a target for future years and expansions. However, Canada would require less mobilization of resources

Situation Analysis

Firm & Product Description

As noted earlier, the name of the company in question is Acme Corporation. Acme has been around since the early 1990's and has presented itself as an alternative to the other manual razor companies. The identified reason for the alternative is that the razor giants like Gillette and Schick (among others) charge quite a bit of money for their razor refills with little to no reason. Acme joins several other upstart companies as they present a more cost-effective alternative to disposable razors.

Company Resources to be Used

The company will be using much of the same resources for the export as will be used for the domestic product. All of the product will continue to be made in the United States. However, Acme will now be exporting some of the finished product to Canadian distributors. This will be done by semi-truck and shipping via UPS/FedEx.

Competitive Situation in the Industry

As noted before, there are two "camps" in the disposable razor market. There are the larger companies that charge a lot for their refills and then there are those that profess the same (or better) quality at a fraction of the price. Market coverage is pretty much all over the developed world as everyone buys a razor of some sort. The key is to get people to switch. Acme has a relatively small market share but intends to expand that market share greatly.

Export Organization

Acme will not need a lot of "boots on the ground" in Canada. Indeed, they will sell online to people in Canada and to distributors that are willing to sell from there. A few salespeople will be in Canada and perhaps a few operations people but that is about it.

Export Marketing Plan

Long-Term & Short-Term Goals

The long-term goal is to get an established customer base in Canada. In the short-term, the objective will be to get Acme's name in the marketplace and get the selling process started. Total sales in units over the first year is desired to be about 10,000 units. Since our average price point is $2.50 USD, that would $25,000. There will be several different product lines. There will be standard and sensitive skin razors for both men and women but the bulk of the customers will probably be men so the men's razor will be the first product sold. Market share will not be terribly big at the onset. However, Acme hopes to get loyal customers through online sales rather than having to spend money on huge ad campaigns. The endeavor into Canada will be a loss at first but the break-even should happen within a few years…if that. This is because the additional investment into Canada will not be terribly high due to the online nature of the sales.

Target Market Characteristics

The Gross National Product of Canada is 1,952,356. Their GDP is 1.825 billion. Their DGP per capita is 37,519.66. The country's economy is mostly flat in terms of growth right now (Trading Economics, 2015). The overall population of Canada is 35.16 million…about ten percent of that of the United States.

Identify, Assess & Select Target Markets

Government Contacts

The Acme Corporation will establish the proper contact with the agencies in the United States that are associated with export of goods. These would include the United States Department of Commerce, the World Trade Center, the standard Chamber of Commerce, Acme's bank, the State's export assistance program, the Small Business Administration, the Small Business Development Center at the local university and the Export Hotline Directory (Ball et al., 2013).

Market Screenings

When it comes to the first market screening, a razor is a basic need for any man or woman in terms of hygiene and desired appearance (Motley Fool, 2008). The only real question is which razor they buy and why. The second screen relates to the financial and economic forces. Since razors are basically needed irrespective of economic conditions, the market for razors is always going to be very strong. In fact, it will be stronger for the budget razors (the better ones in particular) when the economy and job market go sour. As far as political and legal forces go, Canada and the United States are on friendly terms and this relates to both the people and the government. Indeed, many Canadians visit the United States and live near the Canada/United States border (NatGeo, 2015). The fourth screening is sociocultural forces. As with the political/legal forces, the relations between the two countries are amicable. When it comes to the competitive forces this is where things get very competitive. Of course, the big razor-makers have the largest market share but there is a groundswell of people that want cheaper razors with the same overall efficacy (Henry, 2013).

Export Marketing Strategies