Company Profile, Issues with Avocado exporting, HPP, Doing Business in Europe. This project was done as part of BUS 804

1. Ameer Alhadhrami (44018398)
Anwesa Patowary (44072082)
Ogechukwu Maduka (43986692)
Amir Chiti Zadeh (42635802)

2. Outline
 Brief background and history of an organisation’s international
business
 Recent development of an organisation’s international
business
 The three issues related to the organisation’s current
international strategy
 Strategy for the future of the organisation

3. Avocado Export Company
Established in 2009
Based in Brisbane
Owned by avocado growers, packers and marketers across Australia.
Produces 50% of all avocado production in Australia.
Export 60% of its production

4. Company Strengths
• Year round programmed supply
• Supported by technology driven producers
• Modern packing facilities to ensure freshness
• Management has years of experience in exporting fresh fruit
• Full count range of avocados

5. Export Statistics
• Trades as AVOZ Exports
• Export to Singapore, Thailand, Malaysiaand Hong Kong,
• New market: the United Arab Emirates (UAE).
• Increase Australian avocado export to stabilize the domestic market.

6. Management of International Operations
Avocado
Export
Company
Packers
MarketersProducers

7. Management of International Operations
• International Distributors

8. Avocado: Product Characteristics
• Thick flesh
• Smooth and creamy texture,
• pale green color, good flavor,
• High oil content

9. Types of Avocado
Fuerte
Pinkerton
Torre
Ettinger
Arddit
Nabal
Arad
Hass

10. Product Issues: Internal
External
• Fruit fly
• Multiple customer inspection
• Wastage of Fresh Unsold
Products
Internal
• Product Differentiation: Hard
to do
• Durability

11. High Pressure Processing (HPP)
Cold pasteurization technique
Raw avocados subjected to high isostatic pressure (instead of heat) to form
avocado puree.
Lactic acid bacteria, molds, yeasts and pathogenic bacteria inactivated.

13. Advantages of HPP
Solutions for Product Issues:
• Fruit Fly
• Durability Longer Shelf Life
• Easy Transportation of Green Avocados
• New form of product Guacamole
• Keeps freshness Sensory Food Quality
• No Added Chemicals Safe & Organic Food
• Nutrients retention

14. Training Programs
• Handling of avocados
• For international distributors and retailers
• Cooking demonstration of new avocado recipe
Goals:
• To minimize damage and maximize consumer satisfaction
• Effective merchandising and consumer awareness
• Increase Durability

15. Product labelling
Labels include type and ‘Best Before’ Dates
Goals:
Reduces multiple customer inspection

16. Australian Product Quality

17. Health Consciousness
Relevant key market trends
• Foods with added health benefits Vitamins, Healthy fats, Brain
food
• Organics foods 1% of detectable pesticides
• Biodegradable food packaging Health Friendly Packaging
• Environmentally sustainable production

18. Australian Food Industry Overview
•59% consumers tend to eat more natural fresh foods and 49% eat
less processed foods According to the Nielsen global health and wellness report in
2015
• Consumers are becoming more health conscious yet
convenience seeking.
• The fresh food category is growing 4.4% in 2014

19. Statistics Canada
(2013a)
16%
56%
19%
9%
Global Sales in Naturally Healthy Products
Functional Foods Natural Health Product Active in Both Fields Services Only
Total Market Potential

20. Why Is Health consciousness is an issue?
Market
Expansion
Health
Consciousness
Attitudes
towards natural
products
Purchase
intention

21. Price Fluctuation

22. Reasons for Price Fluctuation
• Fruit Bearing Time is 5 years Demand Varies Supply remains Constant
• Limited supply of avocado Price Doubled in 2016
• Transaction cost Trade barriers, Quality Control
• Transportation Cost Air and Ship Freight Cost

23. Why Is Price Fluctuation an issue?
 It affects Revenue- Loss of market opportunity
 Competitor’s Advantage

24. Outline a strategy for the future
of the organisation

25. 3 issues of Current International Business Strategy
1. High Price Fluctuation
2. Product Quality
3. Health Consciousness

26. Strategy for future of AUSPAK
Exporting helps to change systems and approaches quickly and cost-effectively
Exporting offers strategic flexibility
Export to Europe
• Participate in a new market
• Europe Second largest importer of Avocado
• Well-known Healthy product
• According to Rabobank, EU avocado consumption has doubled over the past six years to around 0.75 kg per
capita annually
Engage in competition to respond to foreign rivals
• International South America
• Domestic rivals Spain

27. Strategy for future of AUSPAK
Target Gateway Country:
• Target a gateway country, before exporting to a bigger market.
• Turkey Izmir

28. Why Izmir?
Free Trade Zone
1. Tax Exemption:
• Customs tax
• Corporate Tax
• Value Added Tax (VAT)
• Special Consumption Tax
2. No limitation for product storage in the Free Trade Zone
3. Profits obtained can be freely transferred abroad or within Turkey without
limitations
• From Website: Invest in Izmir

29. New Technology and New Product
• Start New Business Relationship with ‘Pressure Fresh Australia Pty
Ltd’
• Leader in the food manufacturing industry (both domestic and international
market)

30. Fruit industry of Europe
• Spain - biggest supplier in Europe
• In 2016, 80% of avocados in Spain were damaged due to natural
disasters.
• Currently importing from South America and South Africa
• consumers are willing to pay premium price for better quality

31. Drivers of Degree of Rivalry in Europe, 2014

32. Political situation of Europe: Brexit
Impact of Brexit on the European Food & Drink industry:
• Impact on consumer spending within Europe
• UK’s demand for imported goods from Europe
• Exposure to the UK market for European-based companies

33. No Brexit Impact on Europe Food Sales

34. European Fresh and Preserved Fruit sales,
USD mn, % growth y-o-y forcast
-16.3
-2.2
6
2.8
3.4
4.4 4.1
-20
-15
-10
-5
0
5
10
2015 2016 2017f 2018f 2019f 2020f 2021f
%GROWTHOFFRUITSALES
AXIS TITLE
Source: BMI/National statistics

35. References
• http://www.hiperbaric.com/en/high-pressure
• Agriculture and Agri-Food Canada (2013a). Opportunities and Challenges Facing the Canadian Functional Foods and Natural Health
Products Sector (PDF Version, 832 KB).
• Cheftel, J. C. (1992). Effects of high hydrostatic pressure on food constituents: An overview. In C. Balny, R. Hayashi, KK.
• Heremans & P. Masson (Eds), High pressure and Biotecnology, Colloque INSERM (Vol. 224) 195-209
• Goh et al. (2007) Baroprotective effect of increased solute concentrations on yeast and moulds during high pressure
• processing. Innovative Food Science and Technologies, 8, 535-542
• imone Baroke (2015) Packaging Innovation in Fresh Fruit: As Relevant As Ever: Euro monitor International
• Baroke , S 2016, ‘Will New Avocado Trade Body Be Able to Stabilise Supplies?’, passport, 25 May, viewed 27Augest 2017
• BMI Research, 2016, ‘Industry Trend Analysis - European F&D Resilient To Brexit’, Business Monitor International Ltd , 05
September, viewed 28 August 2017
• BMI Research, 2017, ‘Industry Forecast - Europe - Q2 2017 ’, Business Monitor International Ltd , 18 April, viewed 25 August 2017
• MarketLine, 2015, ‘Fruit & Vegetable in Europe’, MarketLine, January, viewed 20 August 2017
• Invest in Izmir 2017, Invest in Izmir, Turkey, viewed 1 September 2005,< http://www.investinizmir.com/en/27196/Free-Trade-Zone-
Incentives >.