Milos Tea going International

International Management

Kelli Adams 11/15/2012

Introduction The Milos product heritage is dated back to the Great Depression in 1939. On April 16, 1946 Milo Carton opened the first hamburger shop on in Birmingham, Alabama. From day one, Milo set out to give customers a unique experience, from the extra slice of beef on their hamburger, the special sauce people never gotten anywhere else, the piping hot hand made pies to the icecold tea with a big bowl of sugar on the side (Milo's Tea Company ). The customer always got more than what they expected. And thats where Milo met his first greatest hurdle. Milo found himself faced with the dilemma of choosing to use his sugar ration to make pies or provide table sugar to sweeten the tea, so Milo decided to try something no one else had considered. He eliminated the sugar bowls from his tables and began to pre-sweeten the tea himself. This ensured enough from his sugar ration for pies and sweet tea! Although this seems perfectly ordinary today, in the 1940s, customers initially drew back at the idea, but then they tasted Milos Famous tea and realized this was something different and something great tasting; the tea soon became in great demand (Milo's Tea Company). In April of 1989, Milos began manufacturing and distributing its Famous Sweet Tea in gallon jugs to grocery stores throughout the Birmingham area (Milo's Tea Company). The first grocery store to carry the product didnt think people would purchase the tea when they could make it themselves. Milo knew they were wrong and knew his customers would make his famous tea an instant success. Customers sought a delightful fresh brewed tea like the kind that grandma made, and Milos Famous Sweet Tea did not dissatisfy. Due to strong demand, Milos introduced the convenient single serving size in 1997 and an unsweetened tea in 1999(Milo's Tea Company).

In 2002, Milos Tea Company sold the Milos hamburger chain in order to focus the business on one thing making the best ready to drink available in the world (Milo's Tea Company). Milos used the capital from the restaurant sale to build a state of the art tea plant like no other in the world (Milo's Tea Company). In 2003 Milos began increasing its distribution region by teaming up with dairy distributors. Since 2003, several more distributors across the Southeast have teamed up with Milos to increase availability in stores throughout the Southeast region. Going International Milos is moving up and becoming extremely successful in the southeast area. It would be idea to export worldwide. Exporting international will be greatly beneficial towards the company and the state of Alabama. Alabama has been gaining from global trade. Today, trade supports 428,486 jobs in Alabama, which is17.5 percent of total jobs (Gwyn, 2010). Trade growth increases jobs by advancing Alabamas manufactures, services providers and farmers. Trade with the world both imports and exports of goods and services create numerous jobs in Alabama (Gwyn, 2010). A unique country to start exporting Milos tea to is the Philippines. Drinks in the Philippines are not only a necessary complement to meals, but also help beat the tropical heat so What would be a better beverage offered in Philippines other than refreshing cold ice tea. Filipino people prefer all natural food and beverages (Dixon, L). Milos tea consists of all the natural resources that would adhere to the Filipino people tastes and preferences. Milos tea is freshly brewed from the highest quality tea leaves available for iced teas. Milos Tea is all natural made from custom blended teas, filtered water, and pure cane sugar. The consumer will

find no preservatives or additives. Milos tea is high in Antioxidants and Milos choose only quality ingredients from the field to the glass. Once exported to the Philippines the tea will be accessible in small markets and fruit and vegetable stands. Milos Tea Company focuses on making the highest quality, all natural, freshly brewed, best ready to drink tea on the market (Milo's Tea Company). Companys Strategy The United States is among the Philippines top trading partners, and it traditionally has been the Philippines largest foreign investors (U.S. State department). When entering in the Philippine business market Milos will use the global strategy ("Export.gov - Doing Business in the Philippines). The company will tend to keep the prices low while doing minimal customization to the product such as only changing some of the language on the label. Milos will not change all of the language because a vast amount of Filipino people use English as their native language and English is the Philippines business language so if the company maintains English on the label it would not be difficult for many people in the Philippines to comprehend. The production, marketing and R&D activities of Milos Ice Tea Company will be concentrated in a few favorable locations. The Philippine business environment is highly personalized ("Export.gov - Doing Business in the Philippines). Milos Ice Tea Company will enter into the Philippine Business market by joint venture entry strategy with a local company. A proper introduction by a trusted intermediary is the best way to enter the Philippines market ("Export.gov - Doing Business in the Philippines). Entering into a joint venture have many advantages when Milos enter into a joint venture with a local independent firm Milos will be able to access the local partners knowledge of the

Philippines, competitive conditions, culture, language, political systems, and business systems. Another gain Milos will have is the local knowledge necessary for competing in the Philippines. When the development cost/ and risks of opening in a foreign market are high, Milos might gain by sharing the costs and risks with a local partner. Finding a joint venture for Milos in the Philippines would not be a hard task because since the 1980s, the Philippines have opened their economy to foreign market, and established network of free trade agreements with several countries. The United States is one of the Philippines top trading partners (Office of Trade and Industry Information). Since Milos is pursuing a global standardization strategy the company main focus is the realization of location. Headquarters will typically have ultimate control over most operating decisions; the firm will be very centralized. The staffing approach Milos Tea Company is going to pursue is Geocentric staffing policy. The company will find the best people for key job throughout the organization, regardless of nationality (Hill, 2013 p.367). There are many advantages to be considered when choosing the geocentric approach; one is it enables the firm to use human resource efficiently. This approach also helps build strong cultural and informal management networks (Hill, 2013 p.367). The company should easily find substantial candidates for the positions since the company has great leaders from headquarters and from their joint venture partnership. Conclusion As long as the U.S. government goal in the Philippines is to continue helping it become a stable and prosperous nation it is likely Milos will build a long term relationship with the Philippines. Milos can help the country by donating gallons of tea each year to different charities. They may

also build a strong relationship by keeping the host-country environment clean by recycling tea leaves and also plastic. Milos Tea Company will always keep a global mindset to guarantee and maintain a long-term relationship with the Philippines. The company will always provide all great tasting all natural ice tea to help keep the citizens hydrated from the relatively high temperatures, and high humidity. The company strives to deliver high quality products that are made to serve the consumer. As long as milos tea remains fresh and all natural the company will forever have a strong bond with the Philippines.

Reference Page Dixon, L. (n.d.). Facts on Food & Beverage in the Philippines | USA Today. Travel Tips - USA Today. Retrieved November 5, 2012, from http://traveltips.usatoday.com/food-beveragephilippines-16185.html

Export.gov - Doing Business in the Philippines. (n.d.). Export.gov - Home. Retrieved November 5, 2012, from http://export.gov/philippines/doingbusinessinthephilippines/index.asp

Gwyn, B. S. (2010). Trade Makes Alabama Strong. Business Roundtable. Retrieved November 5, 2012, from http://trade.businessroundtable.org Hill, C. (2013). Global Human Resource Management. In International Management (9th ed., p. 367). Milo's Tea Company (n.d.). Milo's Famous Tea History | Milo's Famous Tea, Sweet Tea, Splenda Tea, Unsweetened Tea. Milo's Famous Tea, Sweet Tea, Splenda Tea, Unsweetened Tea. Retrieved November 9, 2012, from http://www.milostea.com/history/

Office of Trade and Industry Information (2012, October). Alabama:Exports, Jobs, and Foreign Investment. International Trade Administration. Retrieved November 5, 2012, from http://www.trade.gov/mas/ian

U.S. State department (2012, September 10). Philippines. U.S. Department of State. Retrieved November 5, 2012, from http://www.state.gov/r/pa/ei/bgn/2794.htm