Business Opportunities For Thorntons PLC 1

Topics: Republic of China, Chocolate, Economic growth Pages: 14 (2568 words) Published: April 17, 2015


Business Opportunities For Thorntons PLC
In China: An Exploration

Module Title: Professional Studies
Module Code: 44-6888-00L

Student Name: Wang Chen
Student ID Number: 24034315
Degree Title: BSc(top up) Hospitality Business Management
Tutor Name: Robert Hayward
Date Submitted: 12th December 2014

Executive Summary

This report aims to give a specific explanation to demonstrate whether it is an appropriate time to open Chinese market for Thorntons through analysis of several issues. As the world’s most populous country and second biggest economy, there is much room for company to run businesses in China, and so did chocolate market. Allen (2010) describes China market as a 10K foot race, and so far this chocolate war is only about 10 percent done. So it is still a newly developing market which will certainly have a bright future and the premium brand will become the most popular one to expand within it. Ferrero Rocher was the first chocolate company to enter China, and Mars was the first one to set up factory in 1993. Compared to these foreign chocolate brands, Thorntons may come to China later and it also has some weaknesses such as lacking of experience to explore the international market and so on. However, there is no other time to enter into the Chinese market as now with a stable and healthy political and economical circumstance. Even though companies like Mars, Ferrero, they entering Chinese market early and building up strong brand loyalty, with finest chocolate imported from UK, a good promotion strategy of its brand and a suitable price, Thorntons will achieve great success in the fast growing Chinese market.

Contents
Executive Summary2
1. Introduction4
1.1 Commissioned by4
1.2 Purpose4
1.3 Structure4
2 China Business Environment5
2.1 Recent economic performance5
2.2 Demographic information5
2.3 Culture factors6
2.4 Potential risks6
2.41 Economic situations7
2.42 Intellectual Property (IP)7
2.43 Food safety7
3. Chocolate market in China7
3.1 General view of chocolate market in China7
3.2 Chinese chocolate consumption8
3.3 Existing competitors in China9
4. Strategic Fit Between Thorntons and China10
4.1 Strength10
4.2 Weakness10
5. Conclusion11
6. Recommendation11
6.1 Products and locations11
6.2 Other factors relevant to the success11
Bibliography12

1. Introduction

1.1 Commissioned by
The Chief Executive of Thorntons: Richard Hart.

1.2 Purpose
Present findings in this report to explore whether Thorntons should entering into Chinese market and give several recommendations to put it forward.

1.3 Structure
This report will be laid out as follows: the first section shall introduce Chinese environment in four factors: recent economic performance; demographic information; cultural factors and potential risks. Then the second section will analyze Chinese chocolate market to discover the opportunities and threats of Thorntons. Moreover, through the main competitor’s performance in china, the advantage and weakness Thorntons have when entering into china market can be concluded. Finally, based on that information, the report will sum up with whether Thorntons should enter into Chinese market and make several recommendations to move forward.

2 China Business Environment

2.1 Recent economic performance
Since China reopened its door to the world as well as the economic reforms in 1978, it has experienced a continuous and steady development. “GDP growth averaging about 10 percent a year has lifted more than 500 million people out of poverty.” (The World Bank 2014)

In 2009, China overtook German to be the world’s largest exporter. In 2011, China’s economy surpassed Japan to become the second biggest in the world just behind the United States. “It is also the UK’s fastest-growing export...

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Central Intelligence agency. (JUNE 22, 2014). The World Factbook: China. Available: https://www.cia.gov/library/publications/the-world-factbook/geos/ch.html. Last accessed Nov 22, 2014.
Foreign & Commonwealth Office. (2014). Overseas Business Risk - China. Available: https://www.gov.uk/government/publications/overseas-business-risk-china/overseas-business-risk-china. Last accessed 7th Dec 2014.
Lawrence L.Allen (2010). Chocolate Fortune. New York: American Management Association. p9-39 p40-69 p201-224.
Mintel Group Ltd . (2014). China Chocolate Confectionery. Available: http://gmn.mintel.com/snapshots/CHN/123/shares/single. Last accessed Nov 21, 2014.
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Philip. (2012). Chocolate Market in China. Available: http://marketingtochina.com/imported-chocolate-market-in-china/. Last accessed 8th Dec 2014.
The world bank group. (Apr 01, 2014). China Overview. Available:http://www.worldbank.org/en/country/china/overview. Last accessed Nov 22, 2014.
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theguardian.com. (2014). China 's economic growth falls to lowest in 5 years. Available: http://www.theguardian.com/business/2014/oct/21/chinas-economic-growth-falls-to-lowest-in-5-years. Last accessed 9th Dec 2014.
Thorntons. (2014). About Thorntons. Available: http://www.thorntons.co.uk/. Last accessed Nov 23, 2014.
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