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5 Hour Energy Shot Business Proposal for the United Kingdom Expansion

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5 Hour Energy Shot Business Proposal for the United Kingdom Expansion
5 hour ENERGY Shot
Business Proposal for The United Kingdom Expansion
November 17, 2012

Florida International University – MBA Class 2013 – Group 7

Table of Contents

Executive Summary.…………………………………………………….…………………………..….2 Which Product and Why?………………………………………………………………………………4 Target Consumer Market…...……………………………………………………………………….…6 Labor Cost, Availability……...…………………………………………………………………………10 Macroeconomic condition………………………………………………………………..………….…12 Technology...………………………………………………………………………………………….…14 Growth...……………………………………………………………………………………………….…15 Key challenges/Risk/Political stability/Corruption...……………………………………………….…16 Logistics……………………………………………………………………………………………….…18 Marketing Channel..………………………………………………………………………………….…19 Tariff/Foreign Trade Agreement…………………………………………………………………….…22 Domestic and foreign competition…………………………………………………………………..…23 Cultural Distance….………………………………………………………………………………….…25 Mode of Entry….….…………………………………………………………………………………..…27 Obstacles………….…………………………………………………………………………………..…28 Key Sources of Funding……………………………………………………………………………..…29 Economic Indices..………………………………………………………………………………….…..25 Bibliography…………………………………………………………………………………………...…32

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EXECUTIVE SUMMARY The “High-octane energy drink” market in the United States and internationally has experienced impressive growth of more than 240%, from 2004 to 2009.i Data shows that consumption of these drinks is rapidly growing and the growth is mainly fueled by the United States which contributed $7.6 billion in revenue between 2004-2008.ii These numbers are expected to double in the United States by 2013. One product that currently owns roughly 90% of the energy drinks market in the United States is the 5 hour Energy Drink shot. This brand is only available and marketed in the United States and Canada and poised for international growth. Group One is proposing to introduce this product into The United Kingdom (UK) beverage market, which should open the door for future growth
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