Twining Tea Company Strategic Management

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All businesses that operate in a dynamic world often face challenges beyond their control. In order for every business to succeed, these external factors must be taken into consideration (Buxton & Chapman 1998). Therefore, every business strategy must recognize these forces to identify threats and available opportunities and use them for its benefits.

Failure to react to the external environmental changes may lead to lose of customers. Since the existence and success of business are dependent on its customers, it is therefore worth noting that external environment is the existence of the business (Roy 2009).

Twining Tea Company considers the following external environment factors (microenvironment) in the process of positioning itself in Hull in the UK market to increase its sales in December 2011. Market The tea market in the UK has been steadily growing over the past five years (Stillwell & Clarke 2011).

According to Jonny Forsyth, senior drinks analyst at Intel, the recent economic climate has played a big part in consumer attitudes to tea and two of the worst winters on record have assisted the market, not to mention heavy discounting activities.

However, this report claims that the trend is unlikely to continue if new customers are not attracted (Roy 2009). To improve its positioning, Twining Tea will focus its activities to the unexploited market of young people. This will also ensure market continuity when the old fall out of market.

Customers Hull that has a population of over 258000 currently provides a wide customer base for Twining Tea products (Chen & Tsang 2000). A quarter of its population comprise of the people under 20 years who do not consider tea as their favourite drink.

Success in Hull is therefore greatly dependent on winning this young generation. To achieve this, the company will carry out massive advertisement campaigns aimed at changing attitude of the youth towards their production (Buxton & Chapman 1998). No business is able to survive if the demand for their products is not sufficient to maintain production. This is therefore crucial for tea industry.

Competitors Competition in the tea market in the UK is very high. Five brands, such as PG Tips and Tetley, Premier Foods, Associated British food, and Betty & Taylors dominate the UK market (Stillwell & Clarke 2011). In order to be competitive during the Christmas period, Twining Tea Company will have to cut into the leading companies’ market share.

This will involve taking drastic measures such as significant price reduction, use of shorter channels of distribution and increasing quality (Roy 2009). Reducing price will broaden customer’s base by bringing those who cannot afford to buy such products. Product line, such as revive and cleanse infusions, which are slow movers, can be sold at lower prices quite well (Martin 2007).

Cutting of operational costs may also help to reduce prices. To achieve this, the company will hire less expensive labour (Chen and Tsang 2000).

Most of Twining’s tealeaves are imported. Camellia sinens is from China, Japan and Darjeeling while Camillia sinens is assamica tea from North India. In order to cut further on cost, the company may use locally produced tealeaves of the Tregothnan Estate, an emerging tea estate in the UK where the weather is similar to that of Darjeeling-India (Martin 2007).

Suppliers

Being one of the most important stakeholders, their full cooperation will ensure smooth operation and success. To make sure that the cooperation will be full, the firm will pay them timely at the competitive rates.

References

Buxton, T & Chapman, P (eds) 1998, Britain’s economic performance, Routledge, London.

Chen, Z-Y & Tsang, D 2000, ‘Degradation of green tea catechins in tea drinks’, Journal of agricultural and food industry , vol. 49, no. 1, pp. 477–482.

Martin, C 2007, Tea: The drink that changed the world, Tuttle Publishing, Tokyo.

Roy, K 2009, The marketing of tea, Intertrade Publications, New Delhi.

Stillwell, J & Clarke, M (eds) 2011, Population dynamics and projection methods, Springer, London.

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Twining Tea Company Strategic Management

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