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Tea Coffee World Cup

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Tea Coffee World Cup

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    1. Tea & Coffee World Cup/ Europe 2010 April 25-27, 2010 Vienna, Austria www.tcworldcup.com/vienna

    2. 9/19/2012 www.aginskyconsulting.com 2 STRATEGIC ENTRY INTO NEW EMERGING MARKETS April 26, 2010 Presentation by Alexander Aginsky www.aginskyconsulting.com

    3. 9/19/2012 www.aginskyconsulting.com 3 Presentation Outline Who is ACG? Why go global? Global Outlook for Tea Why Russia? How to go Global Approach for Selecting the Best Market Entry Strategy Case Studies & Examples Lessons Learned

    4. 9/19/2012 www.aginskyconsulting.com 4 WHO IS ACG? Truly international boutique firm Focused on emerging markets, particularly economies of Russia and the CIS Target mid-market companies Staffed with graduate-degree holders from top-tier schools Customized project teams for each individual client engagement Entrepreneurial!

    5. 9/19/2012 www.aginskyconsulting.com 5 ACG Service Offering MARKET ENTRY Strategy development Primary and secondary research Customer mapping and field research Competitive landscape analysis Marketing planning Distribution and channel partnership building Cross-cultural communication and integration Sales and channel management Emerging markets product/service launches Strategic alliances CORPORATE FINANCE Financial planning / modeling Investor relationship management Business valuations Capital fundraising Equity sales M&A advisory

    6. 9/19/2012 www.aginskyconsulting.com 6 Why go global? To increase sales, revenues, and profits To grow the company’s global market share To achieve greater economies of scale To reduce costs To reduce risk To establish a foothold in a promising market To learn from a leading market To build a global brand To respond to competitors To receive investment from PE & VCs

    7. 9/19/2012 www.aginskyconsulting.com 7 Global Outlook for Tea

    8. 9/19/2012 www.aginskyconsulting.com 8 Global Outlook for Tea

    9. 9/19/2012 www.aginskyconsulting.com 9 Global Outlook for Tea

    10. 9/19/2012 www.aginskyconsulting.com 10 Global Outlook for Tea

    11. 9/19/2012 www.aginskyconsulting.com 11 Global Outlook for Tea Future Trends Possibility of an oversupply of black tea in the coming years in the global tea market A growing health and wellness trend boosting the sales of specialty tea varieties such as fruit/herbal tea, green tea, and other tea Higher disposable incomes in many developing economies such as China, India, and Russia, prompting a shift from unpackaged to branded and specialty tea varieties For the next 5-7 years World black tea production is expected to grow at 1.9% annually to reach 3 million tons World green tea production is expected to grow at 4.5% annually to reach 1.6 million tons

    12. 9/19/2012 www.aginskyconsulting.com 12 Why Russia? Economy The IMF predicts that Russia's GDP will grow 4% in 2010. Meanwhile, it expects inflation to reach 7 percent in 2010 before declining to 5.7 percent in 2011, allowing for more borrowing. The fastest growing economy in the G8 group of industrialized nations Investors pouring money into improved storage facilities, infrastructure, and logistics Improving financial services, rule of law, and banking infrastructure

    13. 9/19/2012 www.aginskyconsulting.com 13 Why Russia? Consumers 140 million consumers Price conscious consumers but willing to pay for quality Disposable income increasing, consumers willing to spend on brand names Real wages ?, increased consumer spending Consumers more health conscious than ever Russian consumers are now the fourth biggest spenders on high end goods behind the U.S, Japan and China (Business Week)

    14. 9/19/2012 www.aginskyconsulting.com 14 Why Russia? Reasons for Entry Grow revenues Lower fixed costs per unit Higher prices + lower costs = greater margins Mature home market and/or excess capacity Global competition Gain access to a distribution network Broaden existing products portfolio Global branding, exposure, and geographic reach Diversify business risks

    15. 9/19/2012 www.aginskyconsulting.com 15 Why Russia? Reasons for Entry Largest importer of tea in the world. The total value of Russian tea imports was ~$310 million, which is nearly 14% of the global market. Retail volume growth rates of 15% and 12% in black standard tea bags and black specialty tea bags respectively. BOTTOM LINE – Large Market and Growing Quickly

    16. 9/19/2012 www.aginskyconsulting.com 16 How to go global? Risk vs. control Entering a new market= start-up situation: no sales, no marketing, no knowledge of the market. Low intensity modes of entry minimize risk and control. More financial involvement gives more marketing control.

    17. 9/19/2012 www.aginskyconsulting.com 17 Approach for selecting market entry Identify market segment opportunities Due diligence Focus on long-term benefits Connect with other successful foreign firms in the market Budget plan, entry marketing and promotion

    18. 9/19/2012 www.aginskyconsulting.com 18 Approach for selecting market entry

    19. 9/19/2012 www.aginskyconsulting.com 19 Success stories and Case studies

    20. 9/19/2012 www.aginskyconsulting.com 20 Success stories and Case studies Latest Example: U.S. Company – privately held R&D for over 5 years before launch Top-notch management team Well capitalized, with millions invested Numerous international patents Proprietary technology No debt Highly innovative Mass-market international strategy Unique and differentiated product offering

    21. 9/19/2012 www.aginskyconsulting.com 21 Success stories and Case studies What is it? Holy grail of the beverage industry Self-heating cup Heats in under 60 seconds Strongest and most reliable Consistent Ease of Use: Push ? Shake ? Drink Perfectly safe Convenient Fun & interactive Works with all types of beverages (coffee, tea, hot chocolate, cider, or soup) Self-cooling technology being developed

    22. 9/19/2012 www.aginskyconsulting.com 22 Success stories and Case studies

    23. 9/19/2012 www.aginskyconsulting.com 23 Success stories and Case studies Product substitutes

    24. 9/19/2012 www.aginskyconsulting.com 24 Success stories and Case studies What next? In product launch phase Already entertaining offers from investors Strategic partners Distribution and licensing Co-branding International (perfect for new market entry) Perfect tool for your company to enter new markets

    25. 9/19/2012 www.aginskyconsulting.com 25 Success stories and Case studies LESSONS LEARNED Management team Preparation Long-term vision Capitalization Timing Innovation and technical prowess Clear strategy and an end result in mind Know the process and requirements for getting to that end result Rely on experts who can “bridge” the needs and wants of all parties internationally

    26. 9/19/2012 www.aginskyconsulting.com 26 For a copy of this presentation please contact us. Thank you WEB: www.aginskyconsulting.com EMAIL: info@aginskyconsulting.com TEL: +1-503-546-4049

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