AMB210 Importing And Exporting - Exporting from Australia to Chile: A Case of Pangkarra Foods

Introduction 

Globalization of Small and Medium Enterprises (SMEs) has gained a lot of attentional internationally in the past few years. A small-medium sized firm can be defined to have a maximum of 200 full-time employees (ABS, 2001). The reduction of barriers in the global economy has provided opportunities for emerging markets which can face high competition from the already established international competitors. Thus, internationalization can become a tool of growth, survival and sustainability when globalized (Alon et al., 2009). This paper, therefore analyses the export readiness of Pangkarra Foods, a medium sized company operating in South Australia to Chile. It will evaluate how the company will export, the strategies and the modes to export and what difficulties it might have to face. 

2. Company Background 

Pangkarra Foods is a family owned and operated business started in 2011. Having 33 employees with a revenue of around 6.9M, the company is based in Clare Valley in South Australia and the family business is being continued by Jim and Katherine Maitland (Zoom Info, 2019). The company deals in a range of premium products which include wholegrain dry pasta, wholegrain lavosh, stone milled wholegrain durum flour, gluten-free pasta, chickpea puffs and cooked and roasted legumes (Pangkarra, 2019). Having a great presence at IGAs, gourmet food shops, Foodlands and online, the entire range of pulses has managed to grab 4.5 health star rating on 5 by Australian Federal Government’s Health Star Rating System (AFN, 2016). The paddock-to-plate approach and sustainable farming methods are quite popular and has helped the company to sell across Australia and export to south-east Asia and grab Telstra Small Business Award in 2014 (Agribusines,s 2016). Additionally, the company is listed in Australia’s Top 100 Food & Drink companies as analysts agree they have a strategic advantage (FDB, 2015). 

3. Export Readiness of Pangkarra Foods

Not all firms succeed in the international market and without preparedness, firms shall not go for exporting. Export readiness is necessary to analyze and it is mainly related to three key areas; resources, competitive advantage and objectives. Resources and capabilities help in gaining competitive advantage. The physical and financial resources along with innovative processes helps a firm promote value creation (Ferreira and Simoes, 2016). Talking about Pangkarra, the quality has been controlled at every step in the supply chain. Organic fertilizers along with sustainable practices is done to ensure organic farming. Conventional milling separates the grains ensuring nutritional value in the wholegrain. Being procedures completely natural, they are high in protein and fiber with low glycemic index (Agribusiness, 2016). Thus quality of the produced along with the environmental standards can help it in gaining competitive advantage. 

Competing on price has rather become difficult for the company as paddock-to-plate approach to food production leads to increase in supply-chain costs but products resonate with people looking for healthier options. Moreover, it started exporting to south-east Asia in 2015 (Agribusiness, 2016). The importance of ‘wholegrain’ along with great marketing efforts and PR has made recognition and sales of the brand. Along with this, the whole production process is done by them including manufacturing, packaging and people and everything originating there (Beerenberg, 2019). Thus the companies’ resources are adequate to meet demands of the existing market. This can help them to further grow as their goal is to look for growth of the business and make sure it is sustainable for their children (Beerenberg, 2019).

Introduction 

Globalization of Small and Medium Enterprises (SMEs) has gained a lot of attentional internationally in the past few years. A small-medium sized firm can be defined to have a maximum of 200 full-time employees (ABS, 2001). The reduction of barriers in the global economy has provided opportunities for emerging markets which can face high competition from the already established international competitors. Thus, internationalization can become a tool of growth, survival and sustainability when globalized (Alon et al., 2009). This paper, therefore analyses the export readiness of Pangkarra Foods, a medium sized company operating in South Australia to Chile. It will evaluate how the company will export, the strategies and the modes to export and what difficulties it might have to face. 

2. Company Background 

Pangkarra Foods is a family owned and operated business started in 2011. Having 33 employees with a revenue of around 6.9M, the company is based in Clare Valley in South Australia and the family business is being continued by Jim and Katherine Maitland (Zoom Info, 2019). The company deals in a range of premium products which include wholegrain dry pasta, wholegrain lavosh, stone milled wholegrain durum flour, gluten-free pasta, chickpea puffs and cooked and roasted legumes (Pangkarra, 2019). Having a great presence at IGAs, gourmet food shops, Foodlands and online, the entire range of pulses has managed to grab 4.5 health star rating on 5 by Australian Federal Government’s Health Star Rating System (AFN, 2016). The paddock-to-plate approach and sustainable farming methods are quite popular and has helped the company to sell across Australia and export to south-east Asia and grab Telstra Small Business Award in 2014 (Agribusines,s 2016). Additionally, the company is listed in Australia’s Top 100 Food & Drink companies as analysts agree they have a strategic advantage (FDB, 2015). 

3. Export Readiness of Pangkarra Foods

Not all firms succeed in the international market and without preparedness, firms shall not go for exporting. Export readiness is necessary to analyze and it is mainly related to three key areas; resources, competitive advantage and objectives. Resources and capabilities help in gaining competitive advantage. The physical and financial resources along with innovative processes helps a firm promote value creation (Ferreira and Simoes, 2016). Talking about Pangkarra, the quality has been controlled at every step in the supply chain. Organic fertilizers along with sustainable practices is done to ensure organic farming. Conventional milling separates the grains ensuring nutritional value in the wholegrain. Being procedures completely natural, they are high in protein and fiber with low glycemic index (Agribusiness, 2016). Thus quality of the produced along with the environmental standards can help it in gaining competitive advantage. 

Competing on price has rather become difficult for the company as paddock-to-plate approach to food production leads to increase in supply-chain costs but products resonate with people looking for healthier options. Moreover, it started exporting to south-east Asia in 2015 (Agribusiness, 2016). The importance of ‘wholegrain’ along with great marketing efforts and PR has made recognition and sales of the brand. Along with this, the whole production process is done by them including manufacturing, packaging and people and everything originating there (Beerenberg, 2019). Thus the companies’ resources are adequate to meet demands of the existing market. This can help them to further grow as their goal is to look for growth of the business and make sure it is sustainable for their children (Beerenberg, 2019).