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Thomas Borthwicks and Sons Australian Pty Strategic Implementation
Thomas Borthwicks and Sons Australian Pty Strategic Implementation
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Thomas Borthwicks and Sons Australian Pty Strategic Implementation
Introduction
This paper will focus on Australia’s agribusiness food related sector while understanding and appreciating its strategic implementation. The company of focus will be Thomas Borthwicks and Sons Australian Pty which is a household name in the meat processing industry in Australia for over a century (Thomas Borthwick & Sons (Borthwicks), 2021). They manufacture products that are renowned for their consistency and quality. Besides, the brand Borthwicks has established it name in the export meat industry of Australia for decades. The main topics that will be included in this report include a general summary of the meat processing industry in Australia, the international opportunities for Thomas Borthwicks and Sons Australian Pty, the suitable international strategies for the company, and the both the appropriate and inappropriate approaches to enter the global market for Thomas Borthwicks and Sons Australian Pty. Finally, the paper will provide the future recommendations for the company’s strategic direction in the global context.
Discussion of Australian Food focused Agribusiness Sector
The agribusiness industry of Australia is a diverse sector that offers agricultural products and services across the country and even beyond its borders. The agribusiness sector of the country includes producers, manufacturers, processors, among others but the constant climatic changes is significantly affecting the agri-food patterns (Moshin, 2015). The products’ performance and scope within the agribusiness sector relies on the performance of the producers and manufacturers and their reactions to the external factors’ changes. The Australian government’s publication provides that plant’s size, financial capability, and the workers’ skills that work in the farms and processing plants significantly impacts the productivity in the sector of Agribusiness (Moshin, 2015). Furthermore, external factors such as technical progresses, climatic changes, market conditions, and government policies impacts the productivity in agribusiness.
Since technological advancements is one of the core drivers to the agribusiness’ success in Australia, it is revealed that investment in research and development significantly contributes to Australia’s agricultural productivity. According to Keogh and Heath (2018), agriculture is one of the largest contributors to the GDP of Australia and it is also the fastest economic growth industry. As of 2017, the Australian Bureau of Agricultural and Resource Economics and Sciences (ABARES) reported that general agricultural exports were estimated to have exceeded $50 million (Keogh and Heath, 2018). The company of focus, Thomas Borthwicks and Sons Australian Pty is one of the largest meat processing companies that supplies beef and meat products to various destination across the globe. The company exports to the United States, Europe, Asia, among others regions.
International Opportunities for Thomas Borthwicks and Sons Australian Pty
Based on the selected company, Thomas Borthwicks and Sons Australian Pty specializes in meat processing and is an abattoir which processes Brahman Cross and Short-Hair Brahman cattle, both grain and pasture fed. The domestic and foreign markets for processed beef is constantly growing and the average level of consumption has increased as well (Carey et al. 2016). There exist three core drivers of the popularity of processed beef in Australia, they include, the taste, increased consumption of processed beef, and positive health factors. There is a rapid growth in the market of processed meat (Whitton, Baker, and Mounter, 2016). That, combined with an increased production of beef, makes more exportation for Australia. The case is the same for consumer demand internationally because now people are looking into consuming processed foods more which has led to an increased demand for processed meat.
Spread across a broad geography, the grass-fed beef industry of Australia includes a broad range of cattle breeds, farm sizes, and the system of production. The production diversity allows the sector, which exported 75% of its output in 2019-2020 to service consumers is more than one hundred countries which made Australia the third largest exporter of beef in the world (Bajan and Mrówczyńska-Kamińska, 2020). Besides, Australia is already renowned as one of the leading exporters of live cattle particularly throughout South East Asia and the Middle East. This shoes that the country has already created a rapport with other countries when it comes to the exportation of beef. This can be an opportunity for Thomas Borthwicks and Sons Australian Pty to expand its markets in those regions and export processed beef. In the year 2015, Australia and China signed a cattle export agreement which would see over a million cattle exported to China annually (Bajan and Mrówczyńska-Kamińska, 2020). This shows that the market for beef is huge in China. Since Thomas Borthwicks and Sons Australian Pty is in the same business which is the selling of beef, they could take advantage and expand into China following the rapport that the two countries have already created. Australia’s beef exports continue to break volume records (Carey et al. 2016). This increase is partially driven by Northern Australia’s dry conditions and strong demand for beef from international markets.
International strategies suitable for Thomas Borthwicks and Sons Australian Pty
There are a number of strategies that Thomas Borthwicks and Sons Australian Pty can implement to enter international markets. According to a study conducted by Van Caenegem, Drahos, and Cleary, (2015), there is an increased demand for both live cattle and processed beef in Asia, Europe, the Middle East, the United States, among other regions. Therefore, the profitability is beef products in the foreign markets is guaranteed but to better tap into those markets, newer innovations are needed for this product. Many markets across the globe are leaning towards innovative products so this means that Thomas Borthwicks and Sons Australian Pty should implement product differentiation as one of its strategies when entering the foreign markets. Furthermore according to Bajan and Mrówczyńska-Kamińska (2020), companies should include a product portfolio that is diverse and inclusive. For, Thomas Borthwicks and Sons Australian Pty, they should have a product portfolio with a variety of beef products. This would offer value to different groups of consumers in the foreign markets.
Another strategy that can be implemented is acquiring a subsidiary in the host nation in order to increase their products’ level of growth. In their research, Mehlhorn et al. (2015) argued that considering the strategies of international markets, it is viable to transfer skilled workforce from the developed host markets to Australia. This will enable the stakeholders to depend on an increased integration level of the subsidiary acquired. If theoretical aspects of global strategy is considered, technological innovations, skilled resources, and development of newer methods are very important factors that Thomas Borthwicks and Sons Australian Pty should take into account to gain a competitive edge. Thus, if the host country has capabilities such as newer technologies or skilled labor or if the resources needed in the production process is scarce, then Thomas Borthwicks and Sons Australian Pty can establish a plant in foreign markets. The findings of the research that Mehlhorn et al. (2015)conducted companies that export their products can use company acquisition, establish a plant as Greenfield investment, or can even establish a joint venture with local companies. So to enter foreign markets, Thomas Borthwicks and Sons Australian Pty can used the same strategies.
The most appropriate and inappropriate mode of entry to the international market for Thomas Borthwicks and Sons Australian Pty
Exporting
Exportation is the easiest and most appropriate mode that Thomas Borthwicks and Sons Australian Pty use to enter foreign markets. Because of its ease many companies start their expansion to foreign markets using exportation (Schellenberg, Harker, and Jafari, 2018). Exportation is generally the sale of locally sourced services or products in other countries. The number one advantage of export is that Thomas Borthwicks and Sons Australian Pty will continue to avoid the expenses required to establish operations in other countries. However, the company must establish appropriate ways to market and distribute the processed beef in the new markets. This would be done via contractual agreements with local distributors or companies (Schellenberg, Harker, and Jafari, 2018). While exporting, Thomas Borthwicks and Sons Australian Pty must take into account the packaging, labeling, and pricing of its offerings and make sure that they are appropriate to the international markets. When it comes to the promotion and marketing of the company’s products, Thomas Borthwicks and Sons Australian Pty must inform the buyers of the company’s offerings via trade shows, advertising, local sales forces, among others.
Partnerships and Strategic Alliances
Another appropriate mode of entry is through partnerships and strategic alliances with local partners. Strategic alliances involve contractual agreements between enterprises which stipulates that the parties involved will cooperate for a specified period of time in order to achieve a particular purpose (Ďaďo, Wiktor, and Żbikowska, 2015). In order to determine if the approach of strategic alliance is suitable for Thomas Borthwicks and Sons Australian Pty, the company will be required to decide the value that is brought in by the partner to the venture in terms of both intangible and tangible aspects. One advantage of this mode of entry is that the local company would have an adequate understanding of the local market, culture, and ways to do business better than Thomas Borthwicks and Sons Australian Pty (Ďaďo, Wiktor, and Żbikowska, 2015). Partners are particularly valuable if their brand is well known and has a good reputation in the host country. Also they could have value to the company if they have an established relationship with the consumers that Thomas Borthwicks and Sons Australian Pty might want to target.
New, Wholly Owned Subsidiary
The most inappropriate mode of entry that Thomas Borthwicks and Sons Australian Pty should not implement is the establishment of a new, wholly owned subsidiary which is also known as a Greenfield venture. This mode is not only complex but also very expensive (Schellenberg, Harker, and Jafari, 2018). The proponents of this mode would argue that it would afford the company maximum control and its returns are above average. However, the risks and costs involved are very high given the costs involved in the establishment of new business operations in foreign countries. Besides, Thomas Borthwicks and Sons Australian Pty would have to acquire the expertise and knowledge of new markets by hiring costly consultants.
Recommendations for the future strategic direction
Thomas Borthwicks and Sons Australian Pty should implement a strategic production management in order to improve efficiency in the future. The increase of the weight of carcass, age reduction at slaughter, maintenance of optimum heterosis, and the use of multi-trait selection indices for fertile replacement heifers and feeder cattle are practices of management which would mean a significant impact on beef production sustainability (Terry et al. 2020). Reduction of weight at slaughter and increase of carcass weight are simple approaches to the reduction of beef production’s environmental footprints and improving the efficiency of production. Cattle with large carcass weight and frame tend to more efficiently divert energy towards production compared to smaller framed animals in which more energy is diverted towards their maintenance.
Beef processing plants such as Thomas Borthwicks and Sons Australian Pty should select large framed crossbreed cattle for slaughter because this reduced the number of cattle required for the production of the same quantity of beef (Terry et al. 2020). But costs of feed inputs for large framed cattle is much higher. As grazing and mixed system account for over 90% of beef production globally, improving on this sector would be vital to improving the beef production efficiency (Terry et al. 2020). In addition, the establishment of finishing targets for feeder cattle to reach the weight of slaughter of 658 kg for yearling feeders and 612 kg for calf-fed feeders would result in improved efficiency, reduced greenhouse gas emissions intensity and increased profits for Thomas Borthwicks and Sons Australian Pty both in the local markets and in foreign markets.
Conclusion
This paper considers Thomas Borthwicks and Sons Australian Pty’s strategic implementation in the global context. Since the key product sold by the company is processed beef, it has been identified that with differentiation of products and the rapid increase of processed food consumption in both local and foreign markets, there is a potential increase in demand for processed beef. This means that there is an expanded market for Thomas Borthwicks and Sons Australian Pty’s products both locally and internationally. Considering the appropriate and inappropriate mode of entries to the foreign markets, exportation and strategic alliances has been identified as the best options for Thomas Borthwicks and Sons Australian Pty and establishing and new, wholly owned subsidiary is the inappropriate mode of entry. Also, it is recommended that for future strategic direction, Thomas Borthwicks and Sons Australian Pty should implement a strategic production management in order to improve efficiency.
References
Bajan, B. and Mrówczyńska-Kamińska, A., 2020. Supply of Materials to the Agribusiness Sector of European Union Countries. Problems of World Agriculture/Problemy Rolnictwa Światowego, 20(1827-2020-1132), pp.15-24. DOI: 10.22630/PRS.2020.20.1.2
Carey, R., Caraher, M., Lawrence, M. and Friel, S., 2016. Opportunities and challenges in developing a whole-of-government national food and nutrition policy: lessons from Australia’s National Food Plan. Public health nutrition, 19(1), pp.3-14. https://doi.org/10.1017/S1368980015001834Ďaďo, J., Wiktor, J.W. and Żbikowska, A., 2015. Foreign markets entry motives and strategies of polish exportsers. DOI: 10.15240/tul/001/2015-2-010
Keogh, M. and Heath, R., 2018. Enhancing Private-Sector Investment in Agricultural Research Development and Extension (R, D&E) in Australia. The Australian Farm Institute.
Mehlhorn, J.E., Bonney, L., Fraser, N. and Miles, M.P., 2015. Benchmarking entrepreneurship education in US, Australian, and New Zealand university agriculture programs. Journal of developmental entrepreneurship, 20(03), p.1550017. DOI: 10.1142/S108494671550017X1550017-1
Moshin, M., 2015. Agribusiness financing in Australia: issues and research agenda. International Journal of Economics and Finance, 7(7), pp.1-18. doi:10.5539/ijef.v7n7p1
Schellenberg, M., Harker, M.J. and Jafari, A., 2018. International market entry mode–a systematic literature review. Journal of Strategic Marketing, 26(7), pp.601-627. http://dx.doi.org/10.1080/0965254X.2017.1339114Thomas Borthwick & Sons (Borthwicks), 2021. About Thomas Borthwick & Sons (Borthwicks). [Online] Available at: https://www.nh-foods.com.au/facilities/thomas-borthwick-sons/Terry, S.A., Basarab, J.A., Guan, L.L. and McAllister, T.A., 2020. Strategies to improve the efficiency of beef cattle production. Canadian Journal of Animal Science, 101(1), pp.1-19. https://doi.org/10.1139/cjas-2020-0022Van Caenegem, W., Drahos, P. and Cleary, J., 2015. Provenance of Australian food products: is there a place for Geographical Indications?. RIRDC, 15(060), pp.15-060. https://www.researchgate.net/profile/Peter-Drahos/publication/280722021_Provenance_of_Australian_food_products_is_there_a_place_for_geographical_indications/links/55c2d3e108aeb975673e4c77/Provenance-of-Australian-food-products-is-there-a-place-for-geographical-indications.pdf
Whitton, C., Baker, D. and Mounter, S., 2016. Foreign ownership in Australian agribusiness: results of a survey of firms (No. 427-2016-27359).
Thomas Jefferson Era
Thomas Jefferson Era
Thomas Jefferson (1743-1826) was the third president of the United States, and author of the Declaration of Independence. He was one of the most brilliant individuals in history. His interests were boundless, and his accomplishments were great and varied. He was a philosopher, educator, naturalist, politician, scientists, architect, and inventor, pioneer in scientific farming, musician, and writer(Cunningham 57). He was also the foremost spokesman for democracy of his day.
As president, Jefferson strengthened the powers of the executive branch of government. He was the first president to lead a political party, and through it he exercised control over the Congress of the United States of the United States (Cunningham 102). He had great faith in popular rule, and it is this optimism that is the essence of what came to be called Jeffersonian Democracy.
“Thomas Jefferson’s father, Peter Jefferson, was a prosperous Virginia planter. His mother Jane Randolph Jefferson was a member of the old and distinguished Randolph family of Virginia. In 1743 the Jefferson’s moved to western Goochland County, where Peter Jefferson had acquired 162 hectares (400 acres) of undeveloped land. He named his estate Shadwell. At first the family lived in a single log cabin” (Chinard 254).
Thomas Jefferson was born in this cabin in 1743 (earthlink.net). A year after his birth, Albemarle County was formed from the western portion of Goochland County. Peter Jefferson soon became a leader in the new county. He was a justice of the peace, a magistrate, and commander of the county militia. Although young Jefferson was accepted into the Virginia aristocracy through hi mother’s family, it was his father, a self-made man, whom he especially admired.
“In 1745, a man by the name of William Randolph, a cousin of Mrs. Jefferson and a close friend of the family, died. His will requested that Peter Jefferson move to his estate, manage the house and land, and supervise the education of Randolph’s four children. The Jefferson’s accepted and remained at Randolph’s estate, known as Tuckahoe, for more than seven years” (Dumbauld 75).
“Thomas Jefferson was five years old when he began his education under the family tutor at Tuckahoe. In 1752 the Jefferson’s returned to Shadwell and started work on a plantation home. Thomas, however, spent little time at Shadwell. Almost immediately he was sent to Dover, Virginia, where he studied Latin with the Reverend William Douglas until 1757, when his father died. He was then sent to the school of the Reverend James Maury at Hanover, Virginia, and spent two years studying Greek and Latin classics, history, literature, geography, and natural science” (Chinard 312).
Thomas Jefferson was a tall, slender boy with sandy hair of a reddish cast and fair skin that freckled and sunburned easily. A serious student, he also enjoyed the lighter aspects of the education of Virginia gentleman. He learned to dance and play the violin and holidays he spent either at Shadwell entertaining guests or at his friends’ plantations.
“In March of 1760 Jefferson entered the College of William and Mary in Virginia, and soon came under the influence of Dr. William Small. Jefferson became a favorite of the doctor who taught mathematics, natural history, metaphysics, and moral philosophy. Jefferson also continued his study of classical literature. After two years at William and Mary, Jefferson left to study with Dr. Small’s friend George Wythe, the most learned lawyer in Virginia. Jefferson was very fond of Wythe and called him “my second father.” Even while reading law, Jefferson had too many other interests. He studied French, Italian, and English history and literature. He was keenly interested in the new scientific theory of inoculation and traveled to Philadelphia, Pennsylvania, to have himself inoculated against smallpox” (polytechnic.org).
In 1767, after five years of work and study under Wythe, Jefferson was admitted to the practice of law in Virginia (Dumbauld 67). He was reasonably successful as a lawyer, but did not learn enough to support a Virginia gentleman. Jefferson’s main source of income, like that of most other Virginia lawyers, was his land.
“Throughout his years of law practice, Jefferson spent much time supervising the Shadwell plantation. In his occupation, as in his studies, he was most methodical. He observed the growth of his plants and trees, keeping records of them in a special garden book. A careful observer of his environment, he kept a lifelong record of such things as temperature, weather, expenses, recipes, and anything else that struck him as noteworthy” (earthlink.net).
“On New Year’s Day, 1772, Jefferson married Martha Wayles Skelton, a 24-year-old widow. Patty, as Jefferson called her, shared her husband’s love of music and played the piano. The marriage was a happy one despite Mrs. Jefferson’s ill health. Of their six children, only two, both of them girls, lived to maturity, Martha Jefferson died in 1782” (Cunningham 154). The death of his wife had a profound effect on Jefferson and probably influenced his return to politics, which he had considered abandoning.
By the time of his marriage, Jefferson had for several years been a member of the Virginia House of Burgesses. This was the lower chamber of the Virginia legislature, which was called the General Assembly. “He was elected in 1768 and took his seat at Williamsburg in the spring of 1769. As a burgess, Jefferson took an active part in the events that led to the American Revolution” (Chinard 385). He belonged to the so-called radical group that was in opposition to the conservative planters of the Tidewater region. “Many of his democratic views came from his experience as a resident of the western part of the colony, near the frontier, where he saw the colonists carve a civilization out of the wilderness. This strengthened his lifelong belief that people could and should govern themselves” (mtsu.edu).
Jefferson became the leader of a group that called themselves Democratic Republicans. They wanted the United States to remain a republic of the small, property-holding farmers who, they believed, were its most trustworthy citizens. Democratic Republicans envisioned a central government that was strong enough to protect property but not strong or active enough to threaten property or other republican rights. Jefferson feared the national debt, the federal taxes, and the enlarged civil service that Hamilton’s required.
“When Jefferson was elected president 1800, he paid off much of the debt that Hamilton had envisioned as a permanent fixture of government. The Jeffersonian then abolished federal taxes other than the tariff, reduced the number of government employees, and drastically reduced the size of the military. They did, however, retain the Bank of the United States. Internationally, the Jeffersonians had no ambitions other than free trade the right of Americans to trade the produce of their plantations and farms for finished goods from other countries” (clscc.cc).
Jeffersonians cared more about farmers than about the merchants who carried their produce to Europe and imported European goods, particularly when those merchants operated within established British trade networks and voted for Federalist candidates. “Jeffersonians demanded that the United States be free to trade with any nation and that both France and Britain respect American sovereignty and neutral rights” (Dumbauld 265).
During most of Jefferson’s presidency, Europe was at peace during a break in the Napoleonic Wars. “The one major foreign policy issue was a huge success: Jefferson’s purchase of the Louisiana Territory from France in 1803. The purchase gave western farmers free use of the river system that emptied at New Orleans, removed the French presence from the western boarder of the United States, and provided American farmers with vast new lands on which to expand their rural republic. Ignoring the fact that independent Native American people occupied the Louisiana Territory, Jefferson proclaimed his new land a great “empire of liberty”” (Chinard 247).
“The War of 1812 had been a product of the Napoleonic Wars in Europe. After Napoleon was defeated in 1814, neither the Americans nor the British cared to keep on fighting” (mhhe.com). In the treaty, the British abandoned their Native American allies, and the Americans dropped their complaints about maritime rights. Both assumed that peace would eliminate issues that had been created by war in Europe.
“On June 7, 1776, Richard Henry Lee, who was also a congressman from Virginia, proposed a resolution stating, “that these United Colonies are, and of right ought to be, free and independent states.” Jefferson was one of a committee of five appointed to draft a declaration “to the effect of the said…resolution.” The committee asked Jefferson to draft the paper, and according to committee member John Adams, Jefferson replied, “Well, if you are decided, I will do as well as I can.” When his draft was completed, Adams, committee member Benjamin Franklin, and Jefferson himself made corrections” (mtsu.edu).
On July 2, 1776, Congress passed Lee’s resolution for independence (polytechnic.org). Technically, this was the actual day of American Independence. Then the declaration was debated, several changes were made, and some parts were dropped entirely. Jefferson regretted especially the deletion of a long paragraph denouncing the slave trade and the whole institution of slavery as a cruel war against human nature itself.
“The objective of the declaration, in Jefferson’s own words, was to justify American independence “in terms so plain and full as to command their assent.” As an expression of the philosophy of the natural rights of people in an age when absolute monarchs ruled throughout the world, it had an immense impact in America and in Europe as well. Jefferson did not originate the concept of government by consent and the belief that all people are endowed with certain right that government cannot infringe upon. These ideas came from European philosophers, most notably 17th century British philosopher John Locke. However, in the declaration they were given a practical application for the first time. Furthermore, in Jefferson’s words they achieved their most eloquent expression. On July 4, 1776, the Declaration of Independence was formally adopted. The bands that had connected America with Great Britain were broken. Within a few days the declaration was being read to people throughout the colonies” (Dumbauld 450).
Peace talks between the United States and Britain had begun even before fighting in the War of 1812 began. But serious negotiations did not begin until August 1814, when American and British diplomats met in Ghent, Belgium. John Quincy Adams, Henry Clay, and Albert Gallatin led the American delegation.
Although both sides began with extravagant demands, the final treaty did little accept end the fighting itself. The Americans gave up their demand for a British renunciation of impressments and for the cession of Canada to the United States (clscc.cc). The British abandoned their call for the creation of an Indian buffer state in the Northwest and made other, minor territorial concessions. The negotiators referred other disputes to arbitration. Hastily drawn up, the treaty was signed on Christmas Eve 1814 (Chinard 268).
“Both sides had reason to accept this skimpy agreement. The British were exhausted and in debt from their prolonged conflict with Napoleon and eager to settle the lesser dispute in North America. The Americans realized that with the defeat of have much incentive to interfere with American commerce. Indeed, by the end of 1815, impressments had all but ceased” (earthlink.net).
Other settlements followed the Treaty of Ghent and contributed to a long-term improvement in Anglo-American relations. “A commercial treaty in 1815 gave Americans the right to trade freely with England and much of the British Empire. The Rush-Bagot agreement of 1817 provided for mutual disarmament on the Great Lakes; eventually the Canadian-American boundary became the longest frontier in the world” (mhhe.com).
“For the other parties to the War of 1812, the Indian tribes east of the Mississippi, the Treaty of Ghent was of no lasting value. It required the United States to restore to the tribes lands seized by white Americans in the fighting, but those provisions were never enforced. Ultimately, the war was another disastrous blow to the capacity of Native Americans to resist white expansion. Tecumseh, their most important leader, was dead. The British, their most important allies, were gone from the Northwest. The alliance that Tecumseh and the Prophet had forged was in disarray. And the end of the war spurred a great new drive by white settlers deeper into the west, into land the Indians were less than ever able to defend” (Cunningham 411).
Bibliography:
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