Old Town White Coffee: Malaysia

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Economy

According to Sin Chew Daily (25, March 2015) indicated that the unemployment rate in Malaysia rose 0.1% from 3.1% in January to 3.2% in February 2015. When people are out of work, they have less money to spend on goods or services and thus it will decrease the purchasing power of people. Recently, the value of Ringgit has fall which might lead to further weakening of confidence in the currency. The depreciation of the Malaysia Ringgit made the exchange rate has become lower. Furthermore, the inflation rate in Malaysia rose 0.4% from 2.1% in May to 2.5% in June 2015 due to consumer price increase including the cost of petrol, furniture, household equipment, entertainment expenses as well as routine maintenance.

Social

The lifestyle in Malaysia is more to busy. People are less time to consume and everything needs to be rushing that being busy at work and a lack of leisure time. Moreover, Malaysia consists of various ethnic groups such as Malay, Chinese and Indian; there are many distinct ethnic cuisines. However, the eating habits of people in Malaysia are less concern about the impact of their health as there are over 40% of adult people are overweight due to the content of food they took is high salt and high sugar (Ortega, 2013).

Technology

Malaysia has become more technology-oriented in term of industry. However, Malaysia may not have the advance technology as United Kingdom has; it requires more labour of doing things which lead to high cost (Mohamed, 1991). In addition, the advance technology like internet provides companies in Malaysia an alternative way to advertise its product on website rather than through traditional channels such as through newspaper, television and radio. For instance, most of the restaurants or food and beverage industry adopt this way to reach customers by advertising their restaurants and food via the platform of social media such as Facebook and Instagram as it has viral effect and incurs lower cost.

United Kingdom (UK)

Political

According to the HM Revenue & Customs, the corporate tax in United Kingdom has reduced from 21% in 2014 to 20% in 2015. The government intends to promote the trading and encourage investment by lowering the corporate tax of all companies. Furthermore, UK encourages free trade and open market. Anyone can participate in UK, there are competitive to entry but there are no regulatory to entry. For example, UK will be considered to have a relatively open market while North Korea is considered to have a closed market. In United Kingdom, the political condition is highly developed with high political stability and well established systems. It is an opportunity for the new businesses to operate and give positive impact when entering into the UK market.

Economy

The economy growth of United Kingdom is considered to be positive when it is expanding (Mckibben, 2007). It reflects the businesses are better and the companies are able to hire an additional worker. Thus, the unemployment rate will become lower and enhance the business opportunity of the companies. The exchange rate of Pound always maintains the high value with a steady growth. A strong pound has an impact on all UK companies who either import or export goods in foreign currencies and increase the spending power abroad. Besides, the inflation rate of UK fell further from 0.1% in May to 0% in June 2015 as the food and transportation prices decreased.

Social

The lifestyle is an important aspect to be concern in social issue (Clarke & Critcher, 1985). UK is more concerns to the leisure lifestyle as the way of UK people live are more particular with the quality of living. In United Kingdom, the rhythm of life is lower; they are not constantly in a race of doing anything. Moreover, the eating habit of UK people is considered as healthy. They have higher health-conscious by eating more fibre with less fat. They also took fewer calories and follow calorie-controlled diet.

Technology

UK has more advances in support of technology in term of manufacturing process. The advanced technology helps UK to be has more efficient way of doing things as the machines which can produce the same or even more output than humans in some sectors (Haskel & Martin, 1993). Thus, less labour are needed as technologies can automate the work and lead to cost saving. Furthermore, most of the restaurants or coffee shop in UK are encourages self service from their customers. For example, customers can make their orders with the help electronic gadgets such as ipad and also self service automated machine by placing their orders and make payment for the food. This helps in saving the cost of hiring labors. Thus, the adoption of technology in food and beverage industry could be an important factor to become more efficient in business marketing.

5.0 Adaption for the Products

The Old Town White Coffee is going to use the adaption method when they expand the kopitiam to UK. The main reason the company needs to use the adaption method is due to the customer issues. “Customer issues emphasized on the characteristics, tastes, preferences, and behaviors of customers in overseas markets” (Jain, 1989).

People in different country have different taste and preferences on food. Malaysians prefer a more sophisticated flavours compare to UK. Malaysia’s food is more spicy and sweet compare with UK. Therefore, to adopt the preferences of the UK customers, Old Town White Coffee is going to add a category in the order list for the customer to select the level of spicy and sweetness when they order the food. Moreover UK people are more concerned about healthy eating. Thus, Old Town White Coffee might come out some healthy meals with less calories to fulfill the London customers. Organic raw materials will be used for the healthy meals.

The second reason would be the economic factors. UK has a higher living standard compared to Malaysia. It shows that UK people have higher purchasing power. Therefore the price in the menu can be adjusted to a higher price compare to Malaysia menu. Moreover, UK people are interested with new things so they are willing to pay more on trying new cuisine. Moreover, the labor cost in UK is higher than Malaysia therefore technology such like Ipad Point of Sale (POS) system can be adopted and orders are taken right on the table. This would reduce the number of hiring labors, reduce errors made and give a better