Global Sport Business Plan | Assignment Help
Goal Setting
Given that we are the global leader in developing and manufacturing hockey equipment with our Bauer brand as the strongest, most recognizable brand in the industry, our main focus will be to accomplish the same level of awareness within the South Korean Market. Seoul is the largest and most developed city in our target market with approximately 12.2 million civilians currently residing within the city’s boundaries (www.worlpopulationreview.com). Seoul is also the capital and the surrounding area included cultivates a target consumer base of more than 22 million people (www.gone2korea.com). We will also be gauging the market to identify the avid hockey fans that exist there and are wanting to “be like the pro’s”, whom we can promote our products to for use at their leisure. How shall this be done? These 22 million individuals are becoming more and more interested in the sport of hockey, with Anyang Halla, a professional hockey team playing in the Asian Hockey League, finishing first in the regular season during the 2008-2009 season experiencing sellout crowds after winning 5 Korean Ice Hockey league championships prior to joining the Asia Hockey League in 2003. They have generated a generous fan base and have become well known within the community. We can have success by establishing a partnership with HallaGroug, the owner of the Anyang Halla Ice Hockey Team. (www.halla.com) The Halla group is currently progressing toward a goal to develop ice-based sports for Korean citizens We will engage the JeongMong-won (Halla Group CEO) and Seokmin Lee (Anyang Halla Owner) to introduce our Bauer Brand to their organizations to develop a partnership that will help in building this recognition within our target consumer base. The ability to have a professional organization and their players draped in our product, with our logo on full display is plausible through a venture with Anyang Halla and the entire league as well. Our 2 year goal would be to engage the locals in Seoul, creating a desire to actively participate in hockey for the purpose of purchasing our products that are being displayed by the same professional players that many of our target consumers admire. South Korea is also home to expat teams which consist of foreign and Korean nationals, with the games being non-contact for a majority of the competitions, but full equipment is required to compete (www.korea4expats.com). This presents another potential marketing area to engage in our effort to corner the market. Our 5 year goal would include, not only securing a majority share within the Seoul, South Korea market, but to also develop a partnership with the league as the official gear of the Asian Hockey League. As the game grows, so would our status amongst consumers as the most prominent provider of hockey sports gear throughout Asia. This would help us garner interest in other markets also, as many of the teams within the league reside outside of South Korea. With minimal information available to determine the Asian League Ice Hockey standards, we are to assume that their requirements are similar to that of the most prominent Ice Hockey League in the world, the NHL, of which, according to the Hockey Equipment Certification Council Inc. our helmets goaltender headgear, full face protectors, visors and skates meet certification standards. (www.hecc.net/HECC-Certified-Products.01-May-2013.pdf)
2 year goal:
- 2015 – First Quarter- Gain Access to South Korean markets beginning with Seoul, having products that meet foreign specifications available for use in Expat Hockey game play through established supply chain. Prior supplying product to the market, we must examine the products (helmet & skates) overall appearance to determine how well the product will resonate within the Korean community.
- 2015 – First & Second Quarter – Establish Partnership with Halla Group and local teams to develop partnerships to get products in players possession for immediate use.
- 2015 – Third & Fourth Quarter- Continue to pushing the product into Seoul, and begin expanding into Gyeonggi-do and Goyang depending upon our levels of successful infiltration during this quarter.
- 2015 –Third Quarter- Roll out promotional and advertising pitches prior to the start of the Asian League Ice Hockey Season.
- 2016 – First & Second Quarter – Expand further into Korean Markets, providing a more extensive product line by adding more certified products available to consumers
- 2016 – Second Quarter & Third Quarter- Begin negotiations to establish a partnership with the league as the official provider of AHL hockey gear, expanding our reach into the other markets represented by the league teams.
- 2016 – Roll out marketing pitches in the multiple markets now being represented by the various teams now wearing Bauer Brand hockey equipment during the 2016 season.
Identify Products:
The products we are looking to introduce and expand on would be products within the global ice hockey equipment industry. We will look to expand into different categories such as protective gear, skates, helmets, hockey sticks, jerseys, apparel, goalie gear, and gloves. We will introduce anything that involves hockey and that is required to play the sport efficiently and effectively. We are specifically looking to introduce the Bauer Brand to the Asian Hockey League. Bauer is the most popular hockey brand among amateur, professional and recreational hockey players of all skill and ages. The company has already invested a lot of money into their products and their expansion of products. They have “a disciplined, rolling, multi-year product development program or road-map through which new products to market in an organized and efficient manner”. Across all of their roller hockey and ice hockey equipment categories, the company typically launches approximately 100 to 150 new products a year which can be very beneficial when introducing the products to South Korea.
The products we are looking to introduce in the market have a very high potential to sell due to the increased interest of the sport in the area. There is the Asia League Ice Hockey (ALH); this league is based in East Asia with seven teams in China, Japan and South Korea. The league allows for imports or other players from outside the area to play on a team in order to even out the strength. Some former National Hockey League players have played in the league. If players continue to play in the league it could only be beneficial to the company. The product is very attractive in South Korea as a result of the league building and become more popular. They will naturally need gear to play effectively. Performance sports Limited will offer the best including Bauer which is one of the best-selling hockey brands there is. Variety will be very important to exporting. We want to be able to offer all hockey gear but with different vendors. The new customers will be able to determine what they like and what is best for them and we will also determine what will be the most profitable for the company in this market.
The reason that the export of these products will be successful is because of demand. As the country grows and they become more interested in the sport, so does demand for the product in which they need to actively participate in the sport. Performance Sports Limited, “ice and roller hockey products are sold in over 40 countries through a distribution network of more than 3,700 retailers and distributors”(Bauer, 2013). The company already has a strong base and distributes their products to retailers and other distributors through the facility in Ontario. There are also Sales and distribution center located worldwide including an Asian Sourcing organization in Taichung, Taiwan.
Readiness:
Pros and Cons of market expansion:
For any company to go global and start working outside their border, needs to consider several important aspects before formulating or implementing on any strategic goals and objectives. In the process of going global, there are various pros and cons to it.
- Pros:
- In the process of expanding during a growth phase it does not provide any guarantee of success and profits, however it at least increases the likelihood of success.
- It is likely that consumer confidence and spending is higher in other markets as compare to the home market.
- Depending on which country the business is expanding into, some currencies are likely to stay strong for longer periods.
- If managed properly, international expansion for companies will result in not only international presence but also will increase the business profits (Gordon).
- Cons:
- Almost every single country varies in terms of its demographic, economic, political and social conditions that makes it difficult for companies to analyze market opportunities (Petrakos).
- Presence of subsidiaries around the world makes it hard to communicate, mainly because of the fact that there will be differences in cultures, language and customs.
- There will be number of hidden costs associated with various aspects like registering business, fulfilling the legal requirements of other countries.
- For almost every business regardless the nature of industry it operates in, it needs to have a separate marketing strategy in order to suit the target country (Keefer).
Domestic success:
The Performance Sports Group Ltd (earlier known as Bauer Performance Sports) has experienced rapid growth over the last several years, driven by extending market share in hockey and other new sports goods and apparel manufacture. The competitive strength of the company has been a key driver for success in the ice hockey equipment market. The company’s platform, responsible for spearheading success in the domestic market, consists of: (a) reliable and strong brands; (b) primary innovation and R&D in the industry; (c) comprehensive knowledge of players and consumers; and (d) defending to regulatory requirements, such as proprietary technologies and patents.
The successful leveraging of the platforms have generated pro forma sales of the hockey equipment division and diamond sports division, with an Adjusted EBITDA of US$586 million and US$94 million (for the year ending 31 December, 2013 for Easton Baseball/Softball and a year completed as on 30 November, 2013 for BPS) respectively (“2013Annual Report”) The Performance Sports Group has been the market leader in South Korea for both industries, excluding synergies achieved through operational efficiencies (Flavelle).
