2. GROUP MEMBERS – GROUP 7
IS 016 E. K. A. Anuradha Edirisuriya
IS 037 Minura M. Jinadasa
IS 067 T. H. N. G. Randeniya
IS 088 G. W Dimuthu Surangi
IS 073 H. A. Sanda Mihiri
Samarasinghe
IS 093 T. M. Oshan Tennakone
3. HOW TEA BEGAN….
“The story of tea begins in China. According to legend,
in 2737 BC, the Chinese emperor Shen Nung was
sitting beneath a tree while his servant boiled drinking
water, when some leaves from the tree blew into the
water. Shen Nung, a renowned herbalist, decided to try
the infusion that his servant had accidentally created.
The tree was a Camellia sinensis, and the resulting
drink was what we now call tea….”
4. HOW TEA BEGAN….- JAPAN
“Tea was first introduced to Japan, by Japanese
Buddhist monks who had travelled to China to
study. Tea drinking has become a vital part of
Japanese culture, as seen in the development of the
Tea Ceremony, which may be rooted in the
rituals…”
5. HOW TEA BEGAN….- BRITIAN
“It was the marriage of Charles II to Catherine of
Braganza that would prove to be a turning point in the
history of tea in Britain. She was a Portuguese princess,
and a tea addict, and it was her love of the drink that
established tea as a fashionable beverage first at court,
and then among the wealthy classes as a whole.
Capitalising on this, the East India Company began to
import tea into Britain, its first order being placed in
1664 - for 100lbs..”
6. COMPANY PROFILE
Company Background – Expolanka Teas
Ltd..
Tenth largest exporter of all varieties of Ceylon Tea
since year 2005.
Established in the year 1989 (25 year of existence).
Posses
modern technology including a tea bagging unit
well-equipped tea tasting
grading rooms.
Possesses its own estate and factory, Expolanka
Plantations with Galaxy tea factory.
7. COMPANY PROFILE
Vision
“To be ranked as the fifth largest exporter of tea
in Sri Lanka by the year 2015”
Mission
A specific mission statement not defined;
however, the company is a key player in the tea
export industry of Sri Lanka and this is the main
purpose of the company.
9. COMPANY PROFILE
Products
Value added tea
In consumer packs between 90 - 1000g
Black, green and flavored tea bags in envelopes
Specialty tea bags (in envelopes with string and tag)
Tea packed in exclusive packaging such as jars, wooden
boxes and canisters
A variety of value added specialty teas such as
flavoured teas, fruit teas and herbal teas packed in
attractive printed aluminum canisters.
10. COMPANY PROFILE
The highest volumes are exported to the Middle Eastern markets:
Main markets
United Arab Emirates (U.A.E)
Jordan
Syria
Iran
Russia
Saudi Arabia
Qatar
Other Markets
Canada
Australia
Malaysia
Libya
Turkey
11. COMPANY PROFILE
ETL is certified for ISO 9001:2000,
Quality Management System and
ISO 22000:2005, Food Safety
Management System.
Expolanka Teas (Pvt.) Ltd. were the
recepients of 3 awards at the
prestigious NCE Awards held at the
Hilton, Colombo on the 25th of
September, 2009. The awards
received included:
The Gold Award in the category "Tea
Value Added - Extra Large"
The Gold Award in the category "Tea
Value Added Sector - Most
Outstanding Exporter"
The Silver Award in the category
"Most Outstanding Exporter for year
2008 - Runners up"
12. KEY SECTIONS OF THE ORGANIZATION
1) Blending Division
Flavour of tea varies continuously
even in the same factory
Blending ensures consistence in
flavour and quality
Considerable amount of expertise is
required for this process
Highly profitable stage in the supply
chain of tea
Not exploited as much as the tea
processing industry due to relatively
higher start up cost and level of
expertise
13. KEY SECTIONS OF THE ORGANIZATION
2) Packaging and Tea Bagging
Division
Receives the tea sent by the
blending division
Prepares the tea for dispatch
Produces for both self brands and
external brands
Other brands - either packaged
loose in sacks and dispatched or
packed directly in to tea boxes to
be sold to consumers under the
relevant brands.
Company brand- Packed for the
final consumer in either the local
market or foreign market.
14. KEY SECTIONS OF THE ORGANIZATION
3) Research and Development division
The industry demonstrates high rivalry
Differentiation and widening the choice to customers
provides a competitive advantage
Improvement of quality and efficiency increase value to
the customer.
15. KEY SECTIONS OF THE ORGANIZATION
4) Plantation Division
Consists of the Galaxy Tea Factory and
its estate in addition to the previous
estates owned by the company.
Tea produced is sold at the auction.
The company separately purchases its
requirement of tea from the Colombo tea
auction: the largest tea auction in the
world.
16. KEY SECTIONS OF THE ORGANIZATION
5) Marketing and Sales division
The company produces for foreign brands such as Monzil, Apple
and Barari
This division organizes promotions, maintains communication with
the companies to ensure satisfaction of the need.
The division plays a significant role in managing the brand (from
normal products for super markets to high end products for
exclusive stores.)
The division will play a significant role in the new market in
Australia where the company hopes to sell under its own brand.
17. SUPPORTIVE BUSINESS PROCESSES TO THE
PROCESSING AND BLENDING
Purchasing
Involves all purchases related
to production
Includes all relevant amounts of
different type of tea at the
auction
Includes other materials
essential for production.
Quality controls ensure
reliability of material purchased
to ensure high quality of output.
18. SUPPORTIVE BUSINESS PROCESSES TO THE
PROCESSING AND BLENDING
Marketing
Responsibility - held by the
marketing & sales division.
Customer preference changes
& customer requirements
closely monitored.
Assists the company to
develop its own brand
Maintains a sound relationship
with foreign corporate
customers, buyers of loose tea
or branded, packed tea.
19. SUPPORTIVE BUSINESS PROCESSES TO THE
PROCESSING AND BLENDING
Logistics management
Includes the transport of all material required for
production
A critical part of the business since the clientele of the
company is wide.
20. SUPPORTIVE BUSINESS PROCESSES TO THE
PROCESSING AND BLENDING
Finance
Responsibility of the finance
department
Involves formulation of the
financial strategy & the
management of all expenses
and revenues of the company.
The management of costs is
significant part of this function.
21. SUPPORTIVE BUSINESS PROCESSES TO THE
PROCESSING AND BLENDING
Human resource Management
Responsibility of the Human Resource
Management Division.
Involves
Selection
Recruitment
Training (in house or out-source)
Succession planning
Determination of benefits
Promotions
Other relevant activities
22. SUPPORTIVE BUSINESS PROCESSES TO THE
PROCESSING AND BLENDING
Human resource Management
Support meeting of company
goals, while maintaining its
functional strategy in line with the
corporate strategy of Expolanka
Holding Ltd.
Has a clear HR policy integrated in
to its corporate values.
Honesty, reliability, credibility and
innovativeness are core values of
the company
Succession planning and
determination of benefits play a
critical role in retaining key staff
and maintaining a low labour
turnover.
23. ANALYSIS OF THE MARKETING STRATEGY OF
THE COMPANY THROUGH THE 4P’S APPROACH
OF PHILIP KOTLER
Product
Products developed with focus on the
customer needs.
Predictable level of quality maintained.
Quality control mechanisms
implemented at various stages of the
production process.
Larger choice to customers (availability
of a choice to each range of customers
local and international (organic/normal,
flavoured, herbal, green tea, different
leaf sizes, different flavour strengths)
24. ANALYSIS OF THE MARKETING STRATEGY OF
THE COMPANY THROUGH THE 4P’S APPROACH
OF PHILIP KOTLER
Price
The pricing of the products differ on the product and market.
Loose, unblended tea sold by the plantation at the auction :
determined at the auction while cost of the company and any
minimum margin of the company is satisfied.
Specifically made loose blended tea to large scale foreign
customers for their own brand : mostly sold at a price negotiated
between the customer and the company.
Tea made for the normal market; (tea bags or loose) sold at the
going rate since competition is high.
Up market, branded tea: sold at premium price due to
differentiation (revenue percentage is lower but, margin is much
higher)
Many other factors such as company strategy and long term
objectives require specific prices and quantities
25. ANALYSIS OF THE MARKETING STRATEGY OF
THE COMPANY THROUGH THE 4P’S APPROACH
OF PHILIP KOTLER
Place
Company offices and its agents
worldwide ensure efficient distribution
and wider reach.
Constant communication and tracking of
shipments enable the company maintain
predictability of supply to clientele.
Super market brands are directly sold to
supermarket companies.
Specialized tea outlets including the
company owned Bistro at the halfway
stop of expressway E01 used for sales
as well as promotion.
Boutique hotels and high end stores
such as ODEL buy specific, up market
teas.
26. ANALYSIS OF THE MARKETING STRATEGY OF
THE COMPANY THROUGH THE 4P’S APPROACH
OF PHILIP KOTLER
Promotion
Main focus is the export market
A major percentage of the sales are to
the Middle East and a Lesser quantity is
exported to other countries such as
Russia Canada, Australia, Malaysia, and
Libya.
Foreign brand owners such as Monzil,
Apple and Barari, who buy loose tea or
tea packed under these brands, conduct
their own promotions.
The t-sips brand, the brand of the
company, is managed by the marketing
division which is responsible for
27. THE PHILANTHROPIC ACTIVITIES OF THE
COMPANY THAT HAVE ENABLED IT TO ADOPT A
SOCIETAL MARKETING APPROACH
The company has a strong sense of being a good corporate
citizen.
As well as emphasis on ethics, philanthropic activates are
emphasized.
Recent initiatives taken by
Expolanka teas Ltd.
Sold off a 100 g lot of
Silver Tips tea for Rs. 1
million at a Charity
Auction of Limited Edition
Silver Tip tea to raise
funds for the National
Cancer Institute of
Maharagama.
28. THE PHILANTHROPIC ACTIVITIES OF THE
COMPANY THAT HAVE ENABLED IT TO ADOPT A
SOCIETAL MARKETING APPROACH
Recent initiatives taken by Expolanka
teas Ltd.
Sponsored the annual Royal-Thomian
Regatta for three consecutive years from
2009-2011.
Provided oarsmen with state-of-the-art
sports gear and facilities to perform at
optimum levels.
Sponsors International rowing events
such as the Far East Asian Rowing
Association Championship (FEARA), in
an attempt to boost the sport in Sri
Lanka.
29. THE PHILANTHROPIC ACTIVITIES OF THE
COMPANY THAT HAVE ENABLED IT TO ADOPT A
SOCIETAL MARKETING APPROACH
Recent initiatives taken by Expolanka teas Ltd.
It sponsored the visit of London-2012 Olympic
Gold-Medallist Rower Mahé Drysdale.
Expolanka teas has been a patron of the sport
for years and inviting Mahé Drysdale to Sri
Lanka was yet another undertaking to uplift
rowing in Sri Lanka by inspiring local youth
towards better performance.
30. THE PHILANTHROPIC ACTIVITIES OF THE
COMPANY THAT HAVE ENABLED IT TO ADOPT A
SOCIETAL MARKETING APPROACH
Recent initiatives taken by Expolanka teas
Ltd.
CSR initiative for Cerebral Palsy
Creating awareness about Cerebral Palsy and
creating better living condition for affected
children
Around 40,000 children in the Sri Lanka are
affected by Cerebral Palsy, with many
unreported cases.
t-sips supports the Cerebral Palsy Lanka
Foundation under the brand‟s flagship CSR
initiative, to
assist the country better understand the
condition and
create a better environment for children
with Cerebral Palsy.
A percentage is allocated to the cause from
31. THE PHILANTHROPIC ACTIVITIES OF THE
COMPANY THAT HAVE ENABLED IT TO ADOPT A
SOCIETAL MARKETING APPROACH
Corporate social responsibility
initiatives taken by the holding
company (Expolanka Holdings
Ltd) in association with its
subsidiaries including Expolanka
teas Ltd.
'Expo - Medix' – Subsidized or
free medical services for the under
privileged
Dengue Eradication Programme
Free Medical Clinic Programme
Combating Pollution with Natural
Air Filters
Global Warming Awareness
Programme
Flood Relief Programme in
Polonnaruwa and Elahera
Commemorating World Health
Day with the SOS Children's
Village
32. ANALYSIS OF MOTIVATIONAL STRATEGY …..
ARE THESE STRATEGIES IN-LINE WITH THE TWO
FACTOR THEORY BY FREDRICK HERTZBERG?
Focus on Hygiene Factors
A salary above the industrial average to ensure financial stability.
Welfare benefits such as healthcare and medicine and other
benefits
Clear policies established & supervision to maintain standards.
A genial setting exists in the work areas
Effective communication to maintain positive relationships
Proper equipment with reasonably new technology
Required level of training are provide.
Safety and cleanliness of working areas as well as other basic
facilities including rest rooms, canteen facilities
33. ANALYSIS OF MOTIVATIONAL STRATEGY …..
ARE THESE STRATEGIES IN-LINE WITH THE TWO
FACTOR THEORY BY FREDRICK HERTZBERG?
Focus on Motivational Factors
Commemoration of all religious and cultural events together with
all levels of staff
Relationship building and acceptance that motivates staff due to
the sense of belonging generated.
Comprehensive evaluation schemes, both team-based and
individual to recognized and rewarded exceptional performance.
Succession planning and timely promotion
Delegation of responsibility and empowerment to provide
challenges are practiced to facilitate more independence.
34. ANALYSIS OF MOTIVATIONAL STRATEGY …..
ARE THESE STRATEGIES IN-LINE WITH THE TWO
FACTOR THEORY BY FREDRICK HERTZBERG?
Inference:
The policies of the company and its activities
are closely in-line with the components of the
Two Factor Theory by Fredrick Hertzberg
and this can justify the conclusion that the
company has a highly scientific and rational
approach towards prevention of
dissatisfaction and promotion of motivation.
35. ANALYSIS OF MOTIVATIONAL STRATEGY …..
ARE THESE STRATEGIES IN-LINE WITH THE
HIERARCHY OF NEEDS THEORY BY MASLOW?
Fulfillment of basic, security and social needs of
employees is ensured by the company at all levels.
Eg:-
A salary above the industry average for basic need satisfaction
Benefits such as healthcare, medicine, insurance for stability &
security
Sociable environment with mutual respect horizontally and
vertically.
Social events such as Annual get together‟s involving all staff
Commemoration of all cultural and religious events together w
Work-group based performance evaluation schemes that
facilitate teamwork.
36. ANALYSIS OF MOTIVATIONAL STRATEGY …..
ARE THESE STRATEGIES IN-LINE WITH THE
HIERARCHY OF NEEDS THEORY BY MASLOW?
Special attention given to higher level need of executives and
office staff,
Eg, where Esteem needs are concerned: -
Succession planning, training and timely promotion
Professional or relevant academic achievements recognized to
motivate achievement.
Delegation and empowerment are also for capable staff to allow
more independence and release of potential.
In the case of self-actualization however, identification or
satisfaction of such a need does not appear reasonable here.
This would be a personally identified and satisfied need than one
in which the organization has a key role
Inference: The motivational strategy is a consistent and rational
one as it is somewhat aligned with the Hierarchy of Needs Theory
by Abraham Maslow to a reasonable extent.
37. EVALUATION OF THE LOCAL PROCESSES AND
COMPARISON WITH OTHER REGIONS OF THE
WORLD
Orthodox Process
Predominantly used in processing low
country tea in Sri Lanka.
Brewed tea
dark brownish
much stronger flavour than other teas.
Processed tea
dark black
has a range of leaf sizes
generally larger than others.
High demand in the Middle East and
Russia.
More expensive than other teas.
A core competence of Sri Lanka and in
this range, Sri Lankan tea fetches the
highest price in the world market.
Expolanka tea, focuses mainly on this
and their plantation and factory are also
in the low country region.
38. EVALUATION OF THE LOCAL PROCESSES AND
COMPARISON WITH OTHER REGIONS OF THE
WORLD
Rotorvane process
A process mainly used in the up country of Sri
Lanka.
The tea leaf is grinded using rotor vanes instead
of the rollers used in the orthodox process.
Brewed tea:
Lighter appearance than orthodox processed tea
Strength of the flavour is lesser.
Processed tea: -
Size of the tea leaf is much smaller than orthodox tea
Colour of leaf is browner.
Main markets are Europe, Japan and USA.
Sri Lankan tea is the most expensive in the
world in this range as well and has enabled it to
be positioned as a luxury.
39. EVALUATION OF THE LOCAL PROCESSES AND
COMPARISON WITH OTHER REGIONS OF THE
WORLD
CTC Process
Involves grinding the tea in to very small
particles to brew more tea from a unit of
processed tea.
The strength of the tea is stronger and
brewed tea has a brownish appearance
Focusses on efficiency with more output of
prepared tea per unit of processed tea.
More emphasis on cost reduction than
quality, flavour and fragrance.
Sri Lanka does not focus much on this area
and this is followed by Kenya, Malawi, India
and South African nations.
40. EVALUATION OF THE LOCAL PROCESSES AND
COMPARISON WITH OTHER REGIONS OF THE
WORLD
Evaluating the local processes with the
foreign processes, it would be advisable for
Sri Lanka to focus on its current
competences while maintaining a safe share
in the CTC process since it already caters to
the upper markets with the best quality in the
world market & so positioned.
However, Sri Lanka can develop its own
processes with regard to value for money.
41. EXTERNAL ENVIRONMENT –INDUSTRY ANALYSIS
MICHAEL PORTER’S FIVE FORCES
Threat of new entrants
Tea blending and packing industry: inherently a capital intensive
process.
Higher level of sophistication than the tea processing industry.
The stage where tea is primed for the consumer and attention to detail is
necessary.
To survive in this industry,
skilled labour (eg:- expert tea tasters and quality controllers)
an established network of clients
sophisticated machinery and thus
a high level of capital is a necessity.
Export requires a license and the industry is regulated.
This has the effect of creating barriers to new entry increasing the
attractiveness of the industry.
42. EXTERNAL ENVIRONMENT –INDUSTRY ANALYSIS
MICHAEL PORTER’S FIVE FORCES
Threat of substitute products
Threat of substitutes can be assessed in two ways
If considering tea purely as a beverage
Certain products can be cited as substitutes such as coffee, chamomile,
cocoa and cappuccino
These products also have various ranges to cater to different customers as
in the case of tea.
This may be interpreted as a threat to the loose tea market.
Considering the exclusive products such as flavoured tea and green tea
Cater to a particular market emphasizing on the „tea drinking culture‟ in
some countries
Focus on particular health benefits such as in the case of Green Tea.
Differentiation enables the company to enter into markets to which there is
no direct substitute.
43. EXTERNAL ENVIRONMENT –INDUSTRY ANALYSIS
MICHAEL PORTER’S FIVE FORCES
Bargaining power of customers
Key customers are corporate customers & they purchase in bulk.
The number of customers is few in number and this increases the
bargaining power.
The company is currently expanding its clientele such as by entering the
local market and foreign markets such as Australia.
This enables the company to mitigate the adverse effects of high
customer bargaining power.
44. EXTERNAL ENVIRONMENT –INDUSTRY ANALYSIS
MICHAEL PORTER’S FIVE FORCES
Bargaining power of suppliers
The company sells its own plantation tea at the tea auction and
purchases majority of tea from the Colombo Tea Auction.
This is the largest tea auction in the world offering plenty of choice of a
variety of suppliers.
Enables the company to obtain a range of quality products at an
attractive price.
Therefore, the bargaining power of suppliers is low.
45. EXTERNAL ENVIRONMENT –INDUSTRY ANALYSIS
MICHAEL PORTER’S FIVE FORCES
Rivalry among competitors
The industry is one with a high degree of competition.
There are over 400 companies in the business with 20 significant
players in the market.
There is high degree of rivalry among the 20 key players.
The company is currently in the 10th position.
The company attempts to reduce the affects of competition by
differentiating certain products and
exploiting new markets such as Australia.
The high degree of rivalry lowers the attractiveness of the industry.
46. EXTERNAL ENVIRONMENT –INDUSTRY ANALYSIS
MICHAEL PORTER’S FIVE FORCES
Inference:-
Despite the relatively high bargaining power of customers
and high degree of rivalry, the industry has a wide choice
of suppliers, lower direct substitutes and higher barriers to
new entry.
This is also the industry with the highest return of
investment in the tea industry and this makes the industry
attractive.
47. EXTERNAL ENVIRONMENT – ANALYSIS OF THE
COMPANY ENVIRONMENT (PESTEL ANALYSIS)
Political
Policies of the government have various affects
industry.
Subsidizing of fertilizers has provided major
benefits for the company
The tea industry gains the support of the
government being a major export of the country &
the company benefits from this since government
plays an active role in protecting the industry
such as tax benefits.
The development in infrastructure such as the
road network has helped the country to obtain
fresh, loose tea expeditiously.
Eg: The government of Libya is directly
purchasing tea from the company to overcome
the severe shortage of tea in Libya at the
moment.
48. EXTERNAL ENVIRONMENT – ANALYSIS OF THE
COMPANY ENVIRONMENT (PESTEL ANALYSIS)
Economic
The recession caused a drop in the
demand but now recovered.
The company has been adversely
affected by inflation in Sri Lanka
due to increase in costs.
The increase in the dollar increased
in the import cost of certain flavor
and packaging material.
There is a significant increase in
revenue due to increase in the
value of the Dollar and devaluation
of the Rupee.
49. EXTERNAL ENVIRONMENT – ANALYSIS OF THE
COMPANY ENVIRONMENT (PESTEL ANALYSIS)
Social
Increasing number of the health conscious
groups increase sales of herb tea & green
tea.
The tea industry of Sri Lanka is a reputed
industry considering its contribution to the
economy through exports
Hence, there is a positive attitude towards it
from society
The welfare of the estate staff is monitored
and improved by the company in order to
maintain a decent standard of living.
This benefits the company as the company
believes that "a happy worker is a productive
worker"
50. EXTERNAL ENVIRONMENT – ANALYSIS OF THE
COMPANY ENVIRONMENT (PESTEL ANALYSIS)
Technological
Increasing level of mechanization in the
industry
Utilization of a pyramid tea bagging
machine which is a very rare machine in the
country producing an exclusive type of tea
has further enhanced the company to
consolidate its competitive advantage.
High level of technology needed in the
industry serves as an entry barrier.
Acquisition of new technology has also
enabled the company to increase research
and development enabling continuous
improvement in quality and efficiency.
51. EXTERNAL ENVIRONMENT – ANALYSIS OF THE
COMPANY ENVIRONMENT (PESTEL ANALYSIS)
Environmental
Temperate climate of Sri Lanka is ideal for
tea and all companies in the industry
capitalize on this
Tea plantation is heavily dependent on
weather (output and flavor
Each quarter of the year has its unique
flavor and strength of tea.
This affects seasonal demand depending
on consumer preference.
52. EXTERNAL ENVIRONMENT – ANALYSIS OF THE
COMPANY ENVIRONMENT (PESTEL ANALYSIS)
Legal
The company works within the
export regulations and the
regulations on the industry.
There is a code of best practice in
the company
This maintains standards over and
above minimum requirement of
labour laws of the country as well as
health and safety laws.
53. INTERNAL APPRAISAL – SWOT ANALYSIS
Strengths the company can emphasize on
The company is
ISO 22000 and GMP certified - international standards in food
manufacturing practices
ISO 9001:2008, 22000:2005, GMP, HACCP for standardized
business processes -ensuring quality control in every aspect of
business, (focusses a satisfied client.)
Won several prestigious awards that establishes it in a significant
position in the industry. Recipients of 3 awards at the prestigious NCE
Awards held at the Hilton, Colombo on the 25th of September, 2009.
The awards included
The Gold Award in the category “Tea Value Added – Extra Large”
The Gold Award in the category “Tea Value Added Sector – Most
Outstanding Exporter”
The Silver Award in the category “Most Outstanding Exporter for year
2008 – Runners up”
54. INTERNAL APPRAISAL – SWOT ANALYSIS
Strengths the company can emphasize on
Close to three decades of experience in the industry with many staff
members who have been with it since its inception with a clear vision
loyalty.
Posses a rare Pyramid Tea Bagging Machine (less than ten machines
exist in Sri Lanka) , enables catering to an exclusive up-market strata
through silk wrapped pyramid tea bags.
Has access to more finance if necessary since it is listed in the Colombo
Stock Exchange.
Elaborate network of agents & clients helps to cater to needs at a global
scale.
55. INTERNAL APPRAISAL – SWOT ANALYSIS
Weaknesses the company wishes to resolve.
The cost structure of the company has been somewhat
inflexible, which is a competitive disadvantage
Automation of certain processes has supported this.
Although the company possesses several information
systems, they are not fully integrated and so, the
company cannot make the maximum use of all the
information contained in or through its various parts in
various branches.
56. INTERNAL APPRAISAL – SWOT ANALYSIS
Opportunities the company can make use of
Resurgence of demand for tea overall after the recession.
The subsidization of fertilizers.
The Australian market is an opportunity for expansion.
Although not in a significant scale, the new Bistro in
Expressway E 01 declared open by HE President
Mahinda Rajapakse recently has provided the company
with further opportunity to increase visibility in the local
market.
The company sees Sri Lanka and its climate itself as an
opportunity since it is the ideal situation for tea plantation
whether considering the stronger low country teas or
lighter up country tea.
57. Threats the company needs to mitigate
Continuous increase in costs is a threat to meeting its
objectives. Increase in electricity & labour costs is a
significant component of this.
Despite the climate being ideal for tea plantation, the
unpredictable changes in weather is seen as a threat
since the tea plant is affected continuously by the weather
changes which maybe a change of flavour or a threat to
its survival depending on the weather changes.
INTERNAL APPRAISAL – SWOT ANALYSIS
58. INTERNAL APPRAISAL – SWOT ANALYSIS
Threats the company needs to mitigate
Intense degree of competition in the industry is seen as a
threat by the company
continuous research
increase in quality
differentiation are some of the company‟s strategies to
mitigate the effects of competition.
The inability of the political system and its policies
relevant to the industry are further threats the company
faces
The high taxes and other charges such as the high harbor
charges, container handling charges pose a significant
threat to the tea industry as whole.
59. THE INDUSTRY AND THE STATE
Regulated industry with state
intercession.
Government tax policy affects the
industry since it affects cost of
production
Subsidies have lowered the
production cost due to drop in tea
leaf prices.
Labour laws of the country are
highly tilted towards the
employee against the employer.
60. THE INDUSTRY AND THE STATE
Does not influence pricing to a
great extent as there is an
extensive product range in the
tea industry within a wide price
range to cater to all types of
markets both globally and locally.
Increased competition has
enabled the firms to be
competitive in the global market
due to increased quality and
better management of costs. This
may be the reason the
government does not exert too
much control.
61. IMPACT ON THE ECONOMY BY THE INDUSTRY
The following graphs show the
contribution of the tea industry to the
total exports of Sri Lanka (made using
information extracted from the reports
and website of the Central Bank of Sri
Lanka).
63. RECOMMENDED STRATEGIES FOR COMPANY TO
EXPAND, IMPROVING QUALITY OF SERVICE AND
PRESERVING THE BRAND OF THE COMPANY
Integrate the entire information system of the company in all regions in
order to make affective use of information to take better informed
decisions through up to date and dependable information.
Enable the company to use advanced software such as a decision
support system to make use of better use of the information available
and use the facilities of such a system to preview the possible results of
their decisions.
Use of an executive information system as a further development to the
current management information system to monitor the actives of the
entire company despite its size. Active monitoring and control by the
management is critical to preserve
Quality of output
Predictability of service
Value of the brand
Integration of the information system with corporate clients‟ information
system to develop a comprehensive ERP to enable active involvement
of the client with the policy making. This would enable significant level of
automation and lower dependence on manual labour to increase speed
and reliability while reducing cost in the long term.
64. RECOMMENDED STRATEGIES FOR COMPANY TO
EXPAND, IMPROVING QUALITY OF SERVICE AND
PRESERVING THE BRAND OF THE COMPANY
Automation of the company processes using machinery such as
conveyors or office automation systems to reduce the impact of increase
in labour cost that is a threat to the company. (adverse economic
condition in Sri Lanka with high inflation, high cost of living that drives up
labour cost: a significant portion of the total cost can be, thus controlled.)
Use the networks of the mother company; Expolanka Holdings to
increase access to markets since the mother company is the leading
exporter of fresh coconuts, desiccated coconut, fresh fruits and
vegetables from Sri Lanka
Consider forward rate agreements and hedge agreements or even direct
foreign customer to foreign supplier payment to minimize the impact of
fluctuating foreign exchange to increase financial stability.
Outsource non-core business activities such as IT management, inland
transport to external parties under clear service level agreements to
reduce cost due to economies of scale & receive experienced superior
service.
65. REFERENCES
Expo Lanka Teas (2012). Annual report of Expo
Lanka Teas.
The website of Expo Lanka Teas Ltd.
(http://expoteas.com/)
The website „All about tea‟
www.allabouttea.co.uk/tea-news-blog/why-do-
we-blend-teas
The website of the tea council of UK
(http://www.tea.co.uk/)
The website of the Central Bank of Sri Lanka
(http://www.cbsl.gov.lk/)
66.
67.
68. EVALUATION OF ASSIGNMENT & ASSESSMENT
CRITERIA - AREAS OF POSSIBLE IMPROVEMENT
The assignment was comprehensive and enabled us to obtain an
extensive insight and develop a wider perspective of the practical
aspects of the concept.
The functions of the different areas of the company, their
integration through the corporate strategy, the effectiveness of the
strategy and possible modifications to the strategy were given
special consideration and this added to the knowledge gathered.
The comprehensive research based analysis with focus on
application and analysis than theory, provided us with an
opportunity to gain a far-reaching knowledge of the subject while
empowering self-learning.
However, the time provided to present a comprehensive
analysis of a large organization is highly limited and supply
driven (dependent on time available) than demand driven.
(dependent on time needed) acknowledging the importance
of time management.
Also, while 120 minutes are allocated for 60 marks, the
proportionate value for 20 marks would b 40 minutes, Non