INTERNATIONAL BUSINESS DEVELOPMENT PROPOSAL HOLOFLEX LIMITED

MARK SAHA
4/30/2012

INTERNATIONAL BUSINESS DEVELOPMENT PROPOSAL HOLOFLEX LIMITED

ABSTRACT
The paper critically based on the international business expansion or international marketing for an Indian based packaging and printing company name as Holoflex Limited. The company having a strong domestic market as compare to international market. The current budget meeting being conducted to find out the major challenges faced in International market and to further to draw a business plan or proposal with best action plan which will further helps to develop international business and also develops the export of the company. The international challenges faced by the company also being compared with different international business theory or strategy to understand the problem and derive action plan on the same.

Finally, the action plan being derived and applied in the business to develop international business and export which is stated as fruitful conclusion.

KEY WORDS Holoflex Limited, International Business, Export Development & Strategy

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INTERNATIONAL BUSINESS DEVELOPMENT PROPOSAL HOLOFLEX LIMITED

INTRODUCTION
Holoflex Limited, a hologram manufacturing, supplying and exporting company was established in the year 1991. It was founded by Mr. Manoj Kochar & Mr. Ajit Kumar Surana. It is based at Kolkata, West Bengal, India, having an annual turnover of 28 million USD. Holoflex limited basically a packaging and printing manufactures and exports a wide range of high security hologram labels & allied holographic counterfeit prevention product. It deals in wide range of products such as Security Hologram, Security Hologram, 2D/3D holograms, dot matrix holograms, holograms with variable information, laser hologram , digital hologram, shrink labels and holographic induction sealing wads. For fulfilling the demands of food supplements, lubricants, tobacco and clothing, they also manufacture and supplies holographic stamping foils, magic holographic label, hologram in sheet form and hologram in reel form. Holoflex Limited highly developed research and development department. They also have a well developed state-of-the-art infrastructure and well equipped quality analysis wing. The employees and professionals of holoflex limited are also are highly educated and experienced. It was also been awarded by IHMA and HoMAI1.

MISSION
The mission of Holoflex is to be a best and most trusted hologram solution provider. As it want itself to be a globally recognized company specializing in labeling, high security, AIDC and packaging solution2.

1 2

http://www.holoflex.com/ http://www.holoflex.com/

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INTERNATIONAL BUSINESS DEVELOPMENT PROPOSAL HOLOFLEX LIMITED

RANGE OF PRODUCTS
HOLOGRAM ORIGINATIONS Holoflex limited deals in wide range of Hologram Originations that are extensively used as a potent anti- counterfeiting tool. Hologram originations are manufactured using latest technology and are available in variety of colors. These are manufactured as per clients requirements. There are three types of techniques to make holograms. 2D / 3D Hologram, Dot Matrix Hologram and E - Beam Hologram3 SECURITY HOLOGRAM LABELS Holoflex limited provides various security hologram labels such as Security Holograms, Security Labels, Hologram Security Stickers, Hologram Labels against counterfeiting. Security hologram labels include Tamper Evident Holographic Security Label, Holograms with Variable Information, Stock Design Holograms etc. For more details of Security Hologram Label kindly contact us. HOLOGRAPHIC PACKAGING MATERIALS Holoflex also provides wide range of holographic packaging materials such as Holographic Packaging Films and Holographic Pouch SHRINK SLEEVES Shrink sleeves are used to seal the caps of the bottles so that there is no counterfeiting. These shrink sleeves are used to improve the outlook of the product. There are two types of shrink sleeves like Regular Shrink Sleeves and Holographic Shrink Sleeves. INDUCTION SEALING WADS Induction sealing wads are used in many industries to prevent leakage in bottles, jars etc. these can be customized as per clients need. Induction sealing wads includes Regular Induction Sealing Wads and Holographic Induction Sealing Wads. STAMPING FOIL

http://catalogs.indiamart.com/cgi/catprdsearch.mp?ss=holoflex

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INTERNATIONAL BUSINESS DEVELOPMENT PROPOSAL HOLOFLEX LIMITED Stamping Foils are used to provide protection against counterfeiting. Stamping foil includes Regular Stamping Foil and Holographic Stamping Foil. SECURITY SEALS Holoflex manufactures security seals to protect against tampering and counterfeiting. Security seals are of various types like Meter Seal, self destructive pharma labels and Magic Holographic Labels. HOLOGRAPHIC STRIP TRANSFER These are available in various shapes and sizes as required by the client. These include Paper Label with Integrated Hologram Strip and Holographic Strip for Blister Packaging. AUTOMATIC IDENTIFICATION & DATA CAPTURING Automatic Identification & Data Capture refers to the methods of automatically identifying objects, it helps in collecting data and then entering the collected data into the system without any human efforts. These include bar codes, Radio Frequency Identification (RFID), biometrics, magnetic stripes, Optical Character Recognition (OCR), smart cards, and voice recognition.

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INTERNATIONAL BUSINESS DEVELOPMENT PROPOSAL HOLOFLEX LIMITED

CHALLENGES FACED IN INTERNATIONAL BUSINESS

According to the Holoflex4, the major challenges faced in international business and export mainly concern with the cost, freight, logistics, international business relation between two countries and international marketing. These are as follows COST it is being assumed cost being played a vital role for business. According to the Holoflex export department, the overall cost of the final products seems higher as compare to the competitors rate. The FOB , C&F, CIF price seems to be more than expectation as compare to the competitors in the international market. FREIGHT According to the Holoflex export and logistics departments, the overall freight seems to be much higher as compare to the basic product. The company mainly concern with air freight with respect to the sea and this is because of the quick delivery of the products. The reverse action seems the overall increase of final price. LOGISTICS In case of logistics, the company have international tie up with some major logistics company like DHL, Fedex and Blue Dart where the cost of each shipment seems more than higher which intern increase the final price. Competitors challenge Holoflex by concerning tie upping with the small or new logistics companies who price same services to them where cost of the final product remain same with same services. COMPETITIONS it is being assumed that there are more than 200 packaging companies in India and among them 180 companies are in international business and export of their products which acts as basic challenges for Holoflex limited. Beside these, South-East Asian countries like China, Korea are being considered as a market master in packaging industries which acts as major threat for Holoflex in International market. INTERNATIONAL RELATION According to the Holoflex Export Departments, the company cant export their products to the countries like Russia, Pakistan where the country to country relation was concerned and according to the government of India (GOI, 2007), exporting of products with this countries is highly restricted.

Holoflex Budget Meeting (2012), Holoflex Facing Challenges in International Business

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INTERNATIONAL BUSINESS DEVELOPMENT PROPOSAL HOLOFLEX LIMITED

INTERNATIONAL MARKETING As Holoflex is a small and rising packaging and printing companies in India. Hence, its not possible for the company to move for direct marketing in different countries like USA, UK or Europe to grab the International market or to develop international business and export. PROMOTION The Company seems lack of International exposure according to the international business department. Hence, developing promotion plays an important role for Holoflex. MAN-POWER The export department is based on a small team work with few employees and with a head. Hence, its sometimes seems lacking when it comes a matter of big project or consignments.

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INTERNATIONAL BUSINESS DEVELOPMENT PROPOSAL HOLOFLEX LIMITED

PORTERS GENERIC STRATEGY

Holoflex concerning to Michael Porters5 generic strategy and its business efficiency in the global market and to achieve and maintain competitive advantages. The strategy is basically of three types- cost leadership strategy, differentiation strategy and focus strategy6. These three strategies are Porters generic theory consists of three theories which are defined in two dimensions called strategic scope (demand side) and strategic strength (supply side). Holoflex limited has a adopted these strategies to grab its cliental base in the internati international market. By applying these strategies Holoflex is trying to capture almost all the segments of the market globally7.

5 6

Porter in KPMG (2006). The Indian packaging Industry: Collaboration for Growth. KPMG International PP. 36 Almeida. P, & B. Kogut, (1994), Technology & Geography: The Localization of Knowledge and the Mobility of

Patent Holders, Working Paper.

7

Aggarwal, Aradhna. 2004. Strategic approach to Strengthening the International Competitiveness in the

knowledge based industries: The Indian Packaging Industries.

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INTERNATIONAL BUSINESS DEVELOPMENT PROPOSAL HOLOFLEX LIMITED COST LEADERSHIP STRATEGY Holoflex limited focusing for the application of cost leadership strategy into its business. Holoflex should apply this strategy to capture that segment of market where the demand is more from the side of cost conscious or price sensitive customers. By offering lowest price to the customers, Holoflex will be able to achieve high return on its investment and also earning the desirable profits. And for achieving this there are three ways. The asset turnover of Holoflex is very high because the production capacity of Holoflex is very high and its fixed cost gets distributed among the output produce leading to the decrease in cost of production and hence this enables Holoflex to offer lowest price to its customers. The second way is by involving less direct and indirect operating costs. This can be done by using less number of standard components and keeping a check on number of models produced8. The third way that Holoflex should adopt is by keeping a check on the supply chain and this can be done by buying in huge quantity in order to get quantity discount, bargaining with suppliers for reducing the price, keeping a good relation with vendors, etc. DIFFERENTIATION STRATEGY It is being assumed that Holoflex concern to apply this strategy to enter in the global market by satisfying the various needs of the customers and succeed in this world of competition. Holoflex should apply this strategy to that segment of the market where the customers are not price sensitive, environment is competitive, and the needs of the customers are specific which are not fulfilled accordingly. Holoflex can succeed by doing brand management which will prove to be successful even if the product of Holoflex is same as its competitors product and grab the international market. FOCUS STRATEGY This strategy is basically adopted by big business houses which focus on high profile segment of the society. Holoflex can enter the market with a broad scope or narrow scope. Holoflex should adopt the narrow scope to focus on the few target market where the targeted customers are very few who have special and specific needs. By applying the focus strategy, Holoflex should focus on that segment of target market where the customers do not prefer substitute products, where
8

William E. Fruhan, Jr., "The NPV Model of StrategyThe Shareholder Value Model," in Financial Strategy

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INTERNATIONAL BUSINESS DEVELOPMENT PROPOSAL HOLOFLEX LIMITED the needs of the customers are almos almost t fixed and the competition is weak. And by adopting broad focus scope, Holoflex would be able to focus on the large segment of the market and would have to compete their on price and product quality as per its availability of resources. By adopting the above bove strategies, Holoflex would be able to capture the world market easily and successfully.

DIAMOND THEORY

(Source: Porter in KPMG (2006) (2006). The Indian Packaging Industry: Collaboration for Growth. KPMG International PP. 36) Diamond theory as laid down by y Porter9 mainly describes the change in the industry model. Here in this model porter has done historical analysis. By applying this model Holoflex would be able to relate its performance with the performance of the other company. Porter has classified th this

Porter, M.E. (1986). Competition in global industries: A conceptual framework. In M.E. Porter (Ed.), Competition

in global industries. Boston, MA: Harvard Business School Press.

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INTERNATIONAL BUSINESS DEVELOPMENT PROPOSAL HOLOFLEX LIMITED model into six categories and this theory should be adopted by Holoflex as it is a key tool for analyzing the competition. FACTOR CONDITION - This includes human resources, knowledge resources, physical resources and infrastructure. These resources are important for Holoflex and these are important to compete in order to do business globally. The strong human resource is a point of consideration for international business and knowledge on resource also require for business expansion. DEMAND CONDITION - Focusing to the county market which helps to develop competitive advantages in the global market. This can be achieved by developing the best products and developing maximum utilization of resources. It can also be developed developing the innovated products and more advance product which interns reduce the competition. RELATED AND SUPPORTING INDUSTRIES this can be achieved by producing inputs on providing the process of innovation and internationalization. The product must be developed and cost effective which intern creates an upgrading process hence stimulated the company to reduce competition in global market place. FIRM STRATEGY, STRUCTURE AND RIVALRY - Focusing to determinant of competitiveness where the company must created their goal in respective years and also manage the important of success and desire to win in the global market place. The presence concern with the intense rivalry in the domestic products and which further creates pressure to innovate in order to upgrade competitiveness. GOVERNMENT - Government can influence each of the above to develop international relation maintaining and further to develop international business which interns helps the company to move in all the countries of the world and to develop their business successfully where companies like Holoflex will develop opportunities to develop their business in the international market place. The Porter thesis is that these factors interact with each other to create conditions where innovation and improved competitiveness occurs.

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INTERNATIONAL BUSINESS DEVELOPMENT PROPOSAL HOLOFLEX LIMITED

ACTION PLAN
In current budget meeting of Holoflex (April, 2012)10, the directors of the company took several steps to develop international business and export with respect to time. This year considered as a Leap Year for the company where the growth in international business must be double as compare to the last year (CEO, 2012)11. The major challenges faced in export and international business being taken concern in the meeting and following action plan being stated COST with respect to the factor cost in international market, the company decides to develop pricing strategy and also planned to develop cost leadership and differentiation strategy as stated in Porters Generic Strategy which interns will help the company to move in international market. As the products mainly concern with the developing and under-developed countries like Asia and African countries Hence cost factors being taken under consideration and the planned strategy being applicable for the company from May, 2012, According to the Director (Budget Meeting, 2012). FREIGHT & LOGISTICS focusing to the issues of Freight and Logistics, the company planed to do tie up with the rising logistic companies and also settled to move the final products via then which interns reduce the overall cost of the final products and also increase customer satisfaction. Beside these, the company also planed to FOB pricing for long distance business where freight should be done the importer himself by maintain the good relation with the international client and for nearby country the company planned the freight by road and sea where the advantages will be both interns of cost and time which should be applicable from June, 2012 as stated by the director. COMPETITIONS focusing to the Competitions, the company concern with the cost effective strategy as well as differentiation strategy. The company planned and trained international business development executives to deal with the international client where application of both the strategy is more than necessary to survive in the competitive market. The company design
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Holoflex Business Meeting, 2012, International Business Expansion and Growth Kolkata, India Holoflex Business Meeting, 2012, International Business Expansion and Growth Kolkata, India

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INTERNATIONAL BUSINESS DEVELOPMENT PROPOSAL HOLOFLEX LIMITED both types of products one which is effective for the developing or under-developed country where the product quality is maintained less to medium by maintain the price to survive in the market place and also helps to grab in low value customers. The application of Differtation strategy plays role in the developed country where cost seems not a factors but quality of products should be more than important. The director of the company instructed and also learned production team to ensure the availability of both the types of product to increase or expansion of the international business. The concern of both the strategy being will be application from July 2012 stated in the budget meeting. INTERNATIONAL RELATION The political challenges between countries to country is often challenging for the company to move in the similar country. The company planned to keep good relationship with the buyers or purchaser of the similar products of the internationally challenges countries and expect whenever the relation between both the countries comes to an end. The company expects to develop business relation with the same where one of the examples concern with the development of international business with countries like Pakistan. In Budget meeting, the export executives being instructed to develop relation with the international challenged countries and which is applicable or started from August 2012. INTERNATIONAL MARKETING The Company took the concern of international marketing very seriously in budget meeting. The company also planned to higher experienced marketing people in the same field which interns helps to increase to the international business. The company also planned to recruit new International Business executive who will be responsible for direct marketing in nearby countries like Bangladesh, Sri-Lanka, and Middle East, Nepal etc. Beside these, the company also planned to organize international data capturing process which helps to find out the international buyers. According to the Director, the company also launching franchise for 3-4 countries who will be responsible for representing Holoflex in another country. All this process of international marketing should be applicable from September 2012 as the recruitment for the concern international marketing executive was more than necessary.

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INTERNATIONAL BUSINESS DEVELOPMENT PROPOSAL HOLOFLEX LIMITED TRADE FAIR According to the director in Budget meeting, the company will participate in all most international trade and packaging fair for example Indo-pack, International Packaging which will be applicable from October 2012. B2B PORTALS The Company also make their new portals to grab the international leads over Internet. The company planed to tie-up with major B2B business provider companies like Indiamart.com, Alibaba.com, and Exporterindia.com which will be applicable from November 2012. WEBSITE DEVELOPMENT Holoflex already was having their own website. As the company already launched and catering varieties of products. Hence, development of new website and grabbing international leads through website was considered as a point of consideration. PROMOTION The promotion of company being conducted by advertising the company, direct marketing , website development, B2B portals. ACTION PLAN
COST FREIGHT & LOGISTICS COMPETITIONS INTERNATIONAL RELATION INTERNATIONAL MARKETING TRADE FAIR B2B PORTALS WEBSITE DEVELOPMENT PROMOTION APRIL-12 MAY - 12 JUNE -12 JULY -12 AUG-12 SEP =12

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CONCLUSION
Even though Holoflex considered as one of the giant packaging company in India but still it seems the company facing lot of challenges in international business as well as in case of export which includes the challenges in freight, logistics, website development and finally effect the business growth of the company. It is being assumed the Budget meeting plays an important role where international business development was well planned and executed. It can be also seen all the challenged faced by the company being compared with different international strategy and finally action plan being derived on that basis and which acts as a best solution for the growth of the company in international market. Hope the business plan or proposal being executed and applied in current year will burst will fruitful business and the company will show their growth in current year.

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REFERENCES
1. Aggarwal, Aradhna. 2004. Strategic approach to Strengthening the International Competitiveness in the knowledge based industries: The Indian Packaging Industries. 2. Almeida. P, & B. Kogut, (1994), Technology & Geography: The Localization of Knowledge and the Mobility of Patent Holders, Working Paper 3. Anand. J & B. Kogut, 1997: Technological Capabilities of Countries, Firm Rivalry and Foreign Direct Investment, Journal of international Business Studies, 283,445-466 4. Blomstrom. Magnus, 1986: Foreign Investment and Productive Efficiency. Academy of Management Journal 22 (3). 489515 5. Cantwell, J. 1993, Technological Competence and Evolving Patterns of International Production In H.Cox, J. Clegg & G. Letto-Giles Editors, The Growth of Global Business, London: Rutledge industry. RIS, Discussion paper 80/2004 6. Porter in KPMG (2006). The Indian packaging Industry: Collaboration for Growth. KPMG International PP. 36 7. Kumar, Nagesh and Siddhartan N.S. (1994). Technology, Firm size and export behavior in developing countries: The case of Indian Packaging enterprises. The Journal of Developing studies, vol 31. No. 2, pp. 289-309 8. Holoflex Business Meeting, 2012, International Business Expansion and Growth Kolkata, India. 9. Porter, M.E. (1986). Competition in global industries: A conceptual framework. In M.E. Porter
(Ed.), Competition in global industries. Boston, MA: Harvard Business School Press.

10. William E. Fruhan, Jr., "The NPV Model of StrategyThe Shareholder Value Model," in Financial
Strategy

11. www.holoflex.com 12. www.holoflex.co.in

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