Croswell International is a producer and supplier of health care merchandise in the United States. It also distributes children's diapers. Material Hospitalar is the biggest supplier of healthcare products allover Brazil managed by Leonard Sousa. This paper provides a summary of Croswell and Brazil, the importance of Croswell's success to Leonard Sousa, and it also shows three ways on how Croswell International can enter the Brazilian market.
The president of the Material Hospitalar, Leonard Sousa, approached Croswell because he was interested in supplying the precious diapers from Croswell international. The material Hospitalar was also a supplier of healthcare merchandise in Brazil. If the arrangement set by Sousa were agreed according to the payment and pricing conditions, they would go into business together with Croswell International (Moffett, 1997). Geoff Mathieuxx, the manager of Croswell export operations, monitored up the initial negotiations by placing together an approximation of export prices for dialog resolutions with Sousa. The main issue, in this case, is how Sousa would work together with Croswell International to distribute the Croswell's special diapers throughout Brazil, and how Croswell would benefit through Sousa's distribution plan. Croswell International had the urge to know about all the pricing and charges expectations for the whole stock and value chain as the customers receive them. Matheiux had believed that it is perilous that any agreement Croswell International involved to must lead to a price to customers in the Brazilian sooq, that it is equally impartial for all the parties included and competitive. If the market place Croswell hopes to pass through.
Croswell suggested to the Brazilian supplier that they should vend the basic diaper liner to them for $34.00 per case with the free shipment (Moffett, 1997). This shows that the producer of diapers, Croswell agreed to pay for all the costs that are linked with the acquiring of diapers to the Miami docks when being shipped. The associated documents, the original shipping, and the loading of diapers into the ship cost around $4.32 per dozen (Buckley, 2004). All these incomes cost around $38.32 per case, and they were referred to as cost and freight (CFR). The costs of latent loss of the products associated with the insurance costs while being transported to the ultimate port terminus and the export insurance expenses were around 0.86 per case (Buckley, 2004). In conclusion, the charge, insurance, and merchandise (CIF) are the costs needed by the exporter from the importer when the goods reached in Brazil. CIF is calculated by adding FAS to Transit costs and multiplying by export insurance cost ($ 34.00 + $4.32 + $0.86) * R$2.5/4 = R$ 97.95 (Buckley, 2004).
The definite expenses to the supplier in receiving the diapers the warehouses and ports had to be calculated in conditions that were real to Sousa's costs. The supplier of diapers (Croswell) would now incur the inventory and storage expenses, totaling up to R$245.48 per case. After the retailers include their costs and taxes, the ultimate price of the diaper to the consumer becomes R$245.48 per case (Butler, 2016). With this final selling cost, both Material Hospitalar and Croswell International can estimate the expense effectiveness of valuable Ultra-thin diaper in the Brazilian sooq. This allows them the two parties to have further agreements in the future for business growth. Leonard Sousa is essential to the success of Croswell international by making sure that Croswell's diapers are the most purchased in Brazil. With their marketing strategy, compared to other diaper suppliers, they were of the best quality. With a higher price, this meant that Croswell would achieve a lot of profits by expanding its business to the Brazilian market (Butler, 2016). Through their request of the depiction of local sales forces, foreign marketable references, banking references, sales prediction, and financial statements form Sousa for the diaper line, Croswell would be able to access the ability of Material Hospitalar to be creditworthy, reliable, and to test if it is capable of being a long-term business partner. Also, these requests would enable Croswell to determine if Material Hospitalar would be their right representative in the Brazilian sooq. With all these requests met, Croswell International shouldn't have any doubts about Sousa's ability to deliver his obligations. The demands would also enable the two suppliers to raise the competitiveness of precious diapers in the Brazilian sooq.
Three strategies Croswell International would penetrate the Brazilian Market place is first by reducing the price of their diapers. This is because the consumers would not buy a new type of diapers they do not know for a higher price. When they reduce their prices, there would be direct competition with the local Brazilian Diaper producers, and given that Croswell's diapers were of high quality, customers would be attracted to their products more, and this would help them penetrate the Brazilian marketplace (David, Arthur, & Michael, 2004). Another strategy Croswell would penetrate the market is using Material Hospitalar to publicize their products. Since Hospitalar is already a known supplier in Brazil, consumers would easily trust their products if they made soul their marketing representative and business partner. The last strategy Croswell would use is through improved promotions. This would help to create more awareness for the new diapers, and when consumers recognize it, they will purchase the goods since they are of high quality compared to the Brazilian made diapers.
Buckley, A. (2004). Multinational finance. Pearson Education.
Butler, K. C. (2016). Multinational Finance: Evaluating the Opportunities, Costs, and Risks of Multinational Operations. John Wiley & Sons.
Moffett, M. H. (1997). Crosswell International.
David, K., Arthur, I., & Michael, H. (2004). Multinational business finance. Addison-Wesley.
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