An Essay on Jamba Juice

Topics: Spain, Jamba Juice, Emeryville, California Pages: 29 (10152 words) Published: November 7, 2008
Introduction
Our product is Jamba Juice and our target country is Spain. We chose this product because it has grown to become one of the nation’s best-known smoothie chains, emphasizing the benefits of a healthy lifestyle and because the company is looking for international expansion opportunities. We chose Spain as our target country for expansion of our product due to its current economic status and economic growth forecasts for the future. This combination provides the firm with an opportunity to offer our product to a growing economy and marketplace.

Company Background and History
Jamba Juice takes its name from the African word jama, which means ‘to celebrate’. It was the creation of Kirk Perron, an avid cyclist and graduate of Cal Poly in San Luis Obispo, who wanted to develop a replenishing energy drink for after long bike rides (Sarkar, 2006). He opened his first store in 1990, which he called the Juice Club, but after expanding and opening up several more stores in California, Perron changed the name of the company to Jamba Juice in 1995 and to Jamba in 1996. In 1997, Jamba entered into an operating agreement with Whole Foods Market and in 1999 acquired Zuka Juice Inc. all in an effort to expand brand recognition. Zuka was a prominent smoothie company at the time and its acquisition made Jamba the nation’s best-known smoothie chain. In 1996 after posting sales of 345 million in 2005, Jamba merged with Services Acquisition Corp. for 265 million and went public on the New York Stock Exchange trading under the symbol GMBA (TMFOpie, 2006). In 2007, the company joined with beverage maker Nestle USA to market Jamba-branded juice drinks and smoothies through grocery stores and other retail channels. It hopes the licensing deal will continue to increase consumer awareness of the Jamba Juice brand. Today there are 670 Jamba Juice ventures, consisting of 470 company-owned and 200 franchises in 26 states. Sites include both freestanding units and kiosks in high traffic areas. Jamba Juice’s continued success and growth has led them to look for opportunities to expand internationally (Hoovers, 2008).

Current Situation
Existing Market
Population: The estimated total population of Spain as of 2007 was estimated at 41 million with a distribution of 14% for the age group of 14 and over, 16% for the those between 15-64, and 68% for those 65 years and over. Gender ratios of the same ranges are 1.063, 1.007, and 0.716 male to female, respectively. The total population gender ratio is .956 males to females. The median age is 40 years, with males at 39 years and females at 42, and the population growth rate in 2007 was 0.116% (Index Mundi, 2007).

Growth: While population growth declined in the country after the expansive growth period of the 60’s and 70’s, the increase in industrialization of metropolitan areas such as Madrid, Barcelona, Valencia, and Seville have contributed to a steady increase in the natural rate of growth since 2000 (EUKN, 2008). This has led to a mostly urban population with estimates that 78% of the total population will live in urban areas by 2015. However, there are issues of cities growing beyond their boundaries, resulting in an increasing number of people living on the outskirts of main cities to avoid the high costs of city living.

Income: Spain’s mixed capitalist economy supports a GDP that on a per capita basis is equal to that of the leading West European economies. Currently income per capita is $33,700 (CIA, 2008).

Opportunities
Jamba believes that there are opportunities for growth in Spain because of its strong economy, a large population base and expansive tourist trade, and because the Spanish government actively supports small businesses. Spain is currently the world’s ninth largest economy and is responsible for half the new jobs created in the European Union (Dreamer, 2008). Doing business in Spain provides ample opportunities to target Spain’s resident consumers as well as to...

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