Drizzle Chocolates Exporting Chocolate from Britain to China

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Drizzle ChocolatesExporting Chocolate from
Britain to China

• Justin Kelly
• Jacob Augustine
• Ashley Fiorini

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Company Profile

• Manufactured in Britain
• Confectionary capital of the world
• Export high-quality candies, namely chocolates
  from UK to China
• Branded under the Drizzle Chocolates

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China

• 1.3 billion people
• Majority of population in the eastern coastline
• Political risk
• Chinese communist party
• Legal system Civil Law
• Intellectual property rights

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Chinas Culture

• Strong family importance
• High-Context
• Harmony
• Face
• Guanxi

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Demographics

• Born between 1946-64
• 1965-76 during Chinas development
• Post 1976 have grown up in increasingly wealthy
  and stable environment
• -Group 1 and 2
• -price sensitive and conservative
• -Group 3
• -consumption-oriented experiment, style
  conscious,
• sensitive to advertising
• Target Market Group 2 and 3

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Location

• Start in Chengdu and satellite cities
• Escape higher cost (e.g. Shanghai)

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Market Overview

• Competitors
• Ferrero Rocher of Italy
• Lindt of Switzerland
• Leonidas of Belgium
• Guylian of Belgium
• Cadbury Schweppes
• Wm. Wrigley Jr.
• Nestle SA
• Mars Inc.
• Domestic Manufacturers

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Market Overview

• Growth
• 10 annually
• 52.4 chocolate consumed in the Chinese market
  used as gifts

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Strategy

• Product
• Core Component chocolate
• Streamlined operations easy to add flavors,
  designs, nuts, fruits
• Product diversification (Seasonal)
• Specific Packaging Requirements
• Clear statement of the type of food
• Brand name
• Trademark
• Manufacturers name and address
• Country of origin
• Ingredients
• Date of production
• Sell-by-date
• Packaging
• Bright colors
• Holiday coordination
• Metallic materials
• Avoid white (symbolizes mourning)

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Strategy

• Promotion
• Television ads
• http//www.youtube.com/watch?vRhiSa-WW9kU
• Magazines
• Social Networks
• Incentives for repeat customers
• Partnerships with MTV, CCTV, etc.
• Personal selling
• Focus on romantic and affluent lifestyle
• Target significant holidays

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Strategy

• Significant Target Holidays

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Strategy

• Price
• Higher than grocery store brands
• Target demographics not price sensitive
• High Price High Quality
• Safety

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Strategy

• Place
• Franchise stores
• High-end department stores
• Hotels
• Restaurants

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Marketing Problems Foreseen

• Traditional tastes prefer sweets as desserts
• Changes driven by youth and Western influence
• High costs of entrance into large cities
• Strict customs
• Obtaining loans
• Health
• Melamine scares

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Distribution

• Mode Selection
• Airline
• Short shelf life and appearance
• Chilled
• Packing
• Cooled storage containers
• Channels of Distribution
• Retailers Franchising
• Cut out Wholesalers Middlemen
• Reduce overhead, leverage, proximity

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Distribution

• Transfer of goods
• Freight forwarding through London Gatwick Airport
  
• Arrive at Chengdu Airport
• Goods are transferred to company trucks at
  airport and delivered to warehouse
• Delivered to end retailer through logistics
  network (i.e. Trains---trucks----retailers)

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Terms of Sale

• Ownership transferred upon delivery to
  franchisees and all other locations (FOB)
• Receipt of Payment
• Letter of Credit

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Documentation

• General Documents
• Commercial Invoice
• Consular invoice
• Certificate of Origin
• Inspection Certificate
• Shippers Export Declaration
• Export Packing List
• Warehouse receipt
• Insurance Certificate
• Bill of Lading

• Chinese Entry Documents
• Import Declaration Form
• Commercial Invoice(s)
• Bill of Lading
• Approval document for importation of food
• Support for trade agreement being utilized

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Long-Term Vision

• Expand into hub cities
• (Shanghai, Beijing, Hong Kong)
• Possible alliances (hotels, restaurants)
• IPO
• Private cargo plane

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Questions?