Tavazo Company
INTRODUCTION
The Tavazo company is a family-business which operates in the food industry. Started upon an entrepeunarial initiative in the 1930s in Iran, its business has been developed such as Tavazo now commercializes products such as dried fruits and nuts and operates in activities from growing to retailing. The development has also been geographical as it entered the Canadian market by 2010. Now considering further expansion, the company asks for recommendations to decide of its future strategy. The Tavazos have considered two different strategy lines, which are namely geographical diversification and vertical expansion. The first strategy consists in whether to enter new geographic markets or to focus on the current markets and expand within them as retailers. The second strategy consists in vertical integration by focusing more on the wholesale side.
As a small business operating in a sector with few players, Tavazo copes with particular issues that CPH International intends to answer. Appraising the geographical expansion as the best option for the company, the report is structured as follows.
In a first part, the resources and capabilities of Tavazo Co are identified. Then, a pattern for geographical expansion (within and outside the current markets) is suggested. In conclusion, further recommendations related to the organizational issues faced by the company.
THE TAVAZO COMPANY
The Tavazo company is a family business started upon an entrepreneurial initiative in Iran in the 30s. Its business is vertically integrated and encompasses activities such as growing, manufacturing, wholesale and retailing. Most of the value of the company stems from the retailing activity, which counts for 80% of the current sales. The strategy of Tavazo lies on differentiation by offering high quality products at a premium price (Porter, 1985). In Iran, the company has managed to build loyalty over time, targeting customers with quality as first priority. The demand is
The Tavazo company is a family-business which operates in the food industry. Started upon an entrepeunarial initiative in the 1930s in Iran, its business has been developed such as Tavazo now commercializes products such as dried fruits and nuts and operates in activities from growing to retailing. The development has also been geographical as it entered the Canadian market by 2010. Now considering further expansion, the company asks for recommendations to decide of its future strategy. The Tavazos have considered two different strategy lines, which are namely geographical diversification and vertical expansion. The first strategy consists in whether to enter new geographic markets or to focus on the current markets and expand within them as retailers. The second strategy consists in vertical integration by focusing more on the wholesale side.
As a small business operating in a sector with few players, Tavazo copes with particular issues that CPH International intends to answer. Appraising the geographical expansion as the best option for the company, the report is structured as follows.
In a first part, the resources and capabilities of Tavazo Co are identified. Then, a pattern for geographical expansion (within and outside the current markets) is suggested. In conclusion, further recommendations related to the organizational issues faced by the company.
THE TAVAZO COMPANY
The Tavazo company is a family business started upon an entrepreneurial initiative in Iran in the 30s. Its business is vertically integrated and encompasses activities such as growing, manufacturing, wholesale and retailing. Most of the value of the company stems from the retailing activity, which counts for 80% of the current sales. The strategy of Tavazo lies on differentiation by offering high quality products at a premium price (Porter, 1985). In Iran, the company has managed to build loyalty over time, targeting customers with quality as first priority. The demand is
References: Grant R. M., 2010, Contemporary Strategy Analysis, Wiley, 7th edition Johnson G., Scholes K Lu J.W. and Beamish, P.W., 2001, The internationalization and performance of SMEs, Strategic Management Journal Namiki N., 1988, Export Strategy for Small Business, Journal of Small Business Management Wolf A.J. and Pett T.L, 2000, Internationalization of small firms: An examination of export competitive patterns, firm size and export performance, Journal of Small Business Management Young S., Hamill J., Wlieeler C Source: Adapted from H. Ansoff, Corporate strategy, Penguin, 1988 PRODUCTS