Tim Tam's Into Germany

Introduction

The Tim Tam biscuits first hit supermarket shelves in 1964, since then Tim Tam has become on of the Australians favorite chocolate biscuits. As one of Arnott’s most successful selling product with an average of 35 million packs per year, a staggering 400 million biscuits. At any moment there is on average 1.5 packets in each Australian household.

Arnott’s was founded in 1865 in Newcastle, north of Sydney, NSW. Originally supplying only the local constituents as well as to the crews the coal ships that chose to call Newcastle home port. Since 1865 Arnott’s has become synonymous with Australia's favorite biscuits and snacks and part of the Australian Identity.

This Australian icon first began exporting back in the 1970’s into the Asian market, now Arnotts currently exports Tim Tams to over 40 countries including Japan, the USA, Canada, United Kingdom, Indonesia, Tahiti and New Zealand

Since 1985 Campbell soup has been helping fend off take over bides of the company, by 1997 Campbell soup had a 70% ownership of the Arnott’s company.

Macro-Environment Of Germany

Before we can look at sending over this beloved icon into the German market place external factors that may influence our success in the market place must be looked at.

At first glance Germany seems to be a good market place for Arnotts to investigate; similar culture factors, as well as a strong and promising economy.

Political/Legal

The political system, political parties and the legal environment impact companies and their business. Germany is a federal, parliamentary, representative democratic republic. In this legislation period the objectives are to decrease the unemployment and the ancillary wage costs.

The ancillary wage costs are in Germany higher than in other industrial nations e.g. in the US the ancillary wage costs are half.

Germany is one of the founder members of the EU, plays a major role and works very closely with its EU partners. At the moment there are no serious disputes with other countries. Germany is the Heart of Europe and a good strategic position to launch the Tim Tams in Europe (Bundesministerium, 2007). Political relations between Germany and Australia have traditionally been good.

Economic

In recent years Germany was well known as an exporting nation, but there is also a positive trend in the domestic market. Since the last election the consumption-rates were constantly increasing. The inflation rate is the rate of decrease in the purchasing power of money. The inflation rate was in Germany the past time constant between 1 and 2% (IHK Nordwestfalen, 2007). Because of a constant low inflation rate, there are good surroundings to launch our product.

Furthermore Germany has a very modern infrastructure with good public transport facilities and an excellent road network. That is a big advantage concerning the distribution. Germany has also good manufactures and Engineers in case if we want to produce in Germany in the future. Germany is in Europe one of the countries with the highest patent applications, but Germany is also a country with low economic freedom (FAZ, 2007). In the Economic Freedom of the World Report form the Canadian Fraser Institute, Germany was in 2005 listed on the 18th place. The country with the highest economic freedom is Hongkong. The government influence of businesses is in Germany high, in almost the same manner, the number of regulations (Fraser Institute, 2007).

Germany’s Economy is one of the worlds most urbanized economies, in terms of size, it is the largest economy in Europe and fifth largest in the world in terms of the PPP. Germany is also the second most densely inhabited country in the world with a population of 82.4 Million as of July 2007.

Back in January 1999, Germany and 10 other EU countries introduced a common European exchange currency called the euro to enable easier exchange between countries. At the moment one Euro currently trades at 1.57 AUD, which is an indication to the strength of Germany’s Economy (DFAT, 2007). Economic and scientific relations are lively but could be further intensified. Germany is Australia’s eighth-largest trading partner. Germany ranks fourth in terms of Australian imports (Auswaertiges-Amt, 2007). At the moment the goods and services tax is 19 percent, that’s in comparison to the other EU-members average (FAZ, 2007).

Today, Germany’s economy is heavily export-orientated, with exports accounting for more than one-third of the national output. This has resulted in exports becoming the key element in Germany’s macroeconomic expansion. Some of their main industries within these exports include items such as steel, coal, iron, vehicles, food and beverages to name a few.

Social-Cultural

The socio-cultural environment includes the demographic development, changes in values, general lifestyle as well as culture and tradition.

The development of a society and trends in general are very important, for the adjustment of the product and the company, because they affect the majority of consumers in a market (Homburg, Krohmer, 2006) The important factors for private life are the economic ideals of mobility and flexibility. (Wippermann, DenkanstÐ"¶sse 2003) Complexity and commutability, with a simultaneous glut are typical for our society. (Wippermann, DenkanstÐ"¶sse 2003)

Culture and tradition are tremendous parts of society’s development. The typical German stereotype describes him as hard-working, authentic, punctual and tidy and these parts come together and form a truly German attribute; “Made in Germany” (Sanktjohanser, 2006).

There are some facts of German society’s which make it easy for companies to launch a new product; Germany got only one national language. Every institution and company can easily communicate between the different parts of society.

Germany is also a highly educated country. Science and research are engrained in all parts of society. This will mean that this market place will require more information from the company and desire to be as well informed as possible about the product and what it contains.

Competitive Analysis