The case revolves around a chocolate manufacturing, Zotter based in Austria. The company was the initiator of the organic chocolate. It makes premium chocolate which is hand-scooped and is different in flavor to the other chocolates. The reason is its innovativeness in flavors. The company has developed the market based on its communication about the value of organic and premium chocolate. The company expanded to sell its products outside Austria. The manufacturing process and the already premium prices limit the company’s ability to sale outside of Austria. The founders have the aim to grow, but decision is the path that is required for the development of a market outside of Austria. The case is based on entrepreneurship and the progression of the company to develop its position in the market.
1. Briefly discuss some (at least 2) general external environmental influences that affect chocolate producers.
2. Conduct a Porter's Five Forces Analysis of the chocolate producer industry in Austria. How has Zotter,s strategy helped change the balance of power (of the 5 Forces) in his favor? Explain.
3. Identify the key resources, capabilities, and core competencies of Zotter. How well do they meet the VRIO criteria?
4. Zotter is confronted with several decisions. One of them focuses on where and if to expand. Apply the CAGE framework (discussed in class and also posted in eLearning Learning Modules) to China and US. Based on your analysis make a recommendation on whether Zotter should expand to China or the US. What entry mode should be used and why?