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Cage Analysis

In: Business and Management

Submitted By samiksha146
Words 1248
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CULTURAL DISTANCE | KENYA | UGANDA | NIGERIA | Diversity | 13 ethnic groups and 27 sub groups. | 3 Major Etnic Tribes: Baganda, Basoga and Bagisu. | 3 Major Ethnic Tribes: Yoruba, Hausa-Fulani and Igbo | Language, Religion, Ethnicity | The Most Spoken Languages are English and Swahili. | The Most Spoken Languages are English, Swahili and Arabic. | Over 250 languages. English is the official language | Gender | 1.02 Males/Female | 1.03 Males/Females | 1.031 Males/Females | Inequality (GINI) | 47.7 % | 44.3% | 42.9% | Individualism | Collectivist Society | Collectivist Society | Collectivist Society | Quality of Life (Interpersonal Relationship Vs Material Aspect) | Interpersonal Relationship are Valued. Influence of “Ubuntu” | Interpersonal Relationship are Valued. Influence of “Ubuntu” | Interpersonal Relationship are Valued. Influence of “Ubuntu”.Concept of extended family.“Male egotism “ | Long Term or Short term orientation | Long Term Orientation | Long Term Orientation | Long Term Orientation | Asian Paints should take into account the diversity of Kenya & Uganda while selling different shades of its products. The major implication will be in the marketing communication where language has to be kept in mind. Packaging & designing the product has to be as per the ethnic color preferences.
Since interpersonal relationships are family time is valued – Asian paints should push more pastel shades in the market. Long term orientation implies that more adhesives and long lasting paints will work in the market. has to be kept in mind. Packaging & designing the product has to be as per the ethnic color preferences.
Also since relationships are given importance, the focus must be to build a loyal customer base that can be achieved through services go beyond just “selling the product”

Administrative: | KENYA | UGANDA | NIGERIA | Political & Legal association between trading partners (Colonial Ties Vs Common trading Blocks) | East African Community(EAC)COMESA.South African Development Community: Hence a lot of opportunities | East African Community(EAC)COMESA.Poor Infrastructure network let to drop in uganda’s trade flow to COMESA | Member of OPEC,ECOWAS(Economic Community Of West African States) and G20. | Historical or Current Political Stability | Multi Party Democracy & Stability Since Independence. | Has rebound from Civil War and is from 1990’s. However, still a generation is lost due to human rights abuses. | Nigeria's political parties are pan-national and irreligious in character .Ethnic clashes exist | Laws & Regulations | Independence of Kenya’s courts is compromised.Judicial system is incompetent, corrupt. | | Inherited the English common lawtradition.There also exists Islamic(Muslim) courts and customary courts use aninquisitorial approach in their criminalprocedures. | NGOs | Considerable role in building Kenya’s economy. It’s run by expats. Estimate spent of $4billion. | Include both big and small organizations and also small community groups that work on voluntary effort. | In the paint industry, several NGOs that fight against the excess level of lead. | Corruption | Score of 27/100 on Transparency International’s corruption Index. | Score of 29/100 on Transparency International’s corruption Index. | Score of 139/176 on Transparency International’s corruption Index. | Institutional Void | Relatively deep economic system. | Deep Institutional Voids. | | IPRs | Rank 95/100 on IPR Index published International IPR Index | Rank 55/100 on IPR Index published International IPR Index | Rank 103/130 on IPR Index published International IPR Index | Political Hostility | Political Instability index score is 7.5 | Political Instability index score is 6.5 | |

From an administrative point of view it is better to invest in a trading hub in Kenya given its deep economic system. Uganda because of limited trade within the trade blocs may not be suitable for a long term put. There are institutional voids in Uganda which manifests itself in terms of poor infrastructure. Asian paints should not invest in a manufacturing facility in these countries and should treat them as export markets. Geographic: | KENYA | UGANDA | NIGERIA | Size | 580,367 Sq. Km | 241 038 km² | 923,768kmsq.14th largest country in Africa | Climate | Tropical along the coast – rainfall and cool throughout. Arid further inside. | Tropical; generally rainy during March to May, September to November),remaining months (December to February, June to August) comprise Uganda's two dry seasons | Tropical Climate.Hot and wet in SoutheastDry in Southwest and inland | Transportation | Extensive paved & unpaved roads. Railways link major ports & cities. | Uganda uses a multi-modal transport system, based on road, air, railway, lake andRiver transport services. | Extensive paved & unpaved roads. Railways link major ports & cities. | Landlocked | No. | Yes | No | Ports | Major port – Kilindini Port, Mombasa. Other KPA ports include Lamu, Malindi, Kilifi, Mtwapa, Kiunga, Shimoni, Funzi and Vanga | None | The Lagos Port Complex and Tin Can Island Port in Lagos; Calabar Port, Delta Port, Rivers Port at Port Harcourt, and Onne Port | Airport | 15 Airports. | Main International Airport: Entebbe International Airport. Total 46. 5 with Paved runways. 41 Unpaved. | There are 22 airports of which 4 are international | Neighbors | Kenya is bordered by Ethiopia (north), Somalia (northeast), Tanzania (south), Uganda plus Lake Victoria (west), and Sudan (northwest) | Bordered on the east by Kenya, north by South Sudan, west by the Democratic Republic of the Congo, southwest by Rwanda, south by Tanzania | cordial relations with all its neighbors--Benin, Niger, Chad, Cameroon | Population | 41.61 million | 34.51 million | 162.5 million |

From a geographic point of view – Kenya is better off than Uganda. Asian paints can access rest of Africa through Mombasa port. Also Asian paints should launch products keeping mind the tropical & arid weather of these countries.
Lagos could also be prospective location as the proximity of the port and the city has a strong urban population. Economic | KENYA | UGANDA | NIGERIA | GDP | $41.84 billion | $21.002 billion | US $244 billion | GDP Growth | 4.4% | 6.7% | 7.4% (2011) | HDI | Rank 145 | Rank 161 | Rank 153 | Ease of Doing Business | Rank 121 | Rank 120 | Rank 131 | Availability of Telephone | 24.9 Million Subscribers. | 327, 114 subscribers | 107.4million subscribers | Internet | 16.2 Million | 2.5 Million | 34.5million | Debt to GDP ratio | 50% | 26.8% | 18.7% | Transparency Index | Rank 139/176 | Rank 130/176 | 139/176 | Labour Force | Agriculture 75%, industry and Services 25% | agriculture: 82% industry: 5% services: 13% | Agriculture: 70%, industry and services 30% | Education | 87% Literacy rate | 66.8% | 61% | Natural Resources | Limestone, soda ash, salt, gemstones, fluorspar, zinc, diatomite, gypsum, wildlife and hydropower | Fertile soils, regular rainfall, and sizable mineral deposits of copper and cobalt. | Oil, natural gas, petroleum, tin, iron ore, coal, limestone, niobium, lead, zinc, arable land | Exports | tea, horticultural products, coffee, petroleum products, fish, cement | Coffee, tea & fish. | Oil and natural gas | Imports | machinery and transportation equipment, petroleum products, motor vehicles, iron and steel, resins and plastics | Petroleum products, machinery, cotton piece goods, metals, transportation equipment, and food | Refined petroleum oils, car, telephones. |

The GDP growth rate of the Kenya is on a moderate level as compared to other emerging market countries. There is potential for growth. Given, the high literacy rate and high Transparency Index, doing business in Kenya makes a lot of economical sense. Asian paints, needs to put high emphasize on price points as these markets are highly price sensitive through coming up with different volumes of packaging.
The GDP growth rate in Nigeria is comparatively higher and the larger consumer base makes it a major prospective.
The raw materials required in the paint industry are mostly derivatives from the downstream process of petroleum refining. This would make the availability of raw materials much easier as the pain point of the paint industry is the high costs associated with the imports of the same. The availability of ports in Nigeria makes the region favourable.

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