Analysis of International Market Entry Mode: A

Study on the Coca-Cola, Nestle S.A., Nando’s

Course Title: International Business

Course code: BUS 303
Section: 01

Submitted to:
Mr. Golam Mohammad Forkan.
Associate Professor,
Faculty of Business Administration,
Eastern University

Submitted by:
Md. Mohimin Al Mohid - 161200129
Md. Arif Hossain Ritu - 161200029
Moinul Islam Monty - 161200087
Eastern University

17 December, 2018
FRANCHISING

A franchise is a right granted to an individual or group to market a company’s goods or services

within a certain territory or location. The International Franchise Association (IFE) defines a full
business format franchise as – “A franchise operation is a contractual relationship between the
franchisor and the franchisee in which the franchisor offers or is obliged to maintain continuing
interest in the business of the franchisee in such areas as know-how and training, wherein the
franchisee operates under a common trademark, format or procedure owned or controlled by the
franchisor, under which the franchisee has or will make a substantial capital investment in his
business from his own resources.”

Some examples of today’s popular franchises are McDonald’s, Subway, Domino’s Pizza, and the
UPS Store. Many people associate only fast food businesses with franchising. In fact, there are
over 120 different types of franchise businesses available today, including automotive, cleaning
& maintenance, health & fitness, financial services, pet-related franchises etc.

1. The Coca-Cola Company- The Franchisor

The Coca-Cola Company is an American corporation, and manufacturer, retailer, and marketer
of nonalcoholic beverage concentrates and syrups. The company is best known for its flagship
product Coca-Cola, invented in 1886 by pharmacist John Stith
Pemberton in Atlanta, Georgia.[3] The Coca-Cola formula and brand were bought in 1894 by Asa
Griggs Candler (December 30, 1851 – March 12, 1929), who incorporated The Coca-Cola
Company. The company—headquartered in Atlanta, Georgia, but incorporated in Wilmington,
Delaware[4]—has operated a franchised distribution system since 1889: the Company only
produces syrup concentrate, which is then sold to various bottlers throughout the world who hold
exclusive territories. The company owns its anchor bottler in North America, Coca-Cola
Refreshments. The company's stock is listed on the NYSE and is part of DJIA, the S&P
500 index, the Russell 1000 Index, and the Russell 1000 Growth Stock Index. Muhtar
Kent serves as chairman of the company with James Quincey as president and chief executive
officer.
Coca-Cola Bangladesh- The Franchisee

Coca-Cola Bangladesh is the Bangladeshi subsidiary of the Coca-Cola Company which

produces Coca-Cola and its products domestically in Bangladesh. The official licensee in the
country is PRAN-RFL Group, who used to produce cola flavored soft drink called Pran
Cola before acquiring the license from Abul Monem Group. The company also launched
a cumin seed flavored drink called Rim Zim in 2018 which is only exclusive to Bangladesh.

2. Nestlé S.A.- The Franchisor

Nestlé SA is a nutrition, health and wellness company, which engages in the manufacture, supply
and production of prepared dishes and cooking aids, milk-based products, pharmaceuticals and
ophthalmic goods, baby foods and cereals. The company products portfolio includes powdered
and liquid beverages, water, milk products and ice cream, nutrition and health science, prepared
dishes and cooking aids, confectionery, and pet care. It operates through the following segments:
Zone EMENA, Zone Americas, Zone Asia, Oceania & Africa, Nestlé Waters, Nestlé Nutrition,
and Other Businesses. The Other Business segment is comprised of Nespresso, Nestle Health
Science and Nestle Skin Health. The company was founded by Henri Nestlé in 1866 and is
headquartered in Vevey, Switzerland.

Nestlé in Bangladesh- Joint venture

As amongst the world’s largest food and Beverage Company, we have enhanced the quality of
life of individuals and their families in 191 countries over 150 years. In Bangladesh too, our
purpose is the same, ensuring a healthier future for a country we have partnered with for 25
years. Started as a joint venture between Transcom Limited and Nestlé S.A, Switzerland in 1992,
Nestlé Bangladesh Limited started commercial operations in 1994 with its first factory in
Sreepur. Nestlé Bangladesh became a 100% owned subsidiary of Nestlé S.A. in 1998.
Over the past two decades, Nestlé Bangladesh has offered diverse products and services for all
stages of life, helping people take better care of themselves and their families. We have engaged
extensively with the communities where we operate, ensuring training for farmers, enhancing
livelihoods, educating children and their families on proper nutrition, and actively promoting
environmentally sustainable operations. Read more about our country initiatives here.
The current product portfolio of Nestlé Bangladesh includes Brands like NESTLÉ FRUITA
VITALS, NESCAFÉ, NESTEA, MAGGI (Noodles, Soup and Seasoning), NESTLÉ KOKO
KRUNCH, NESTLÉ MILO, NESTLÉ CORNFLAKES, NESTLÉ COFFEEMATE, NESTLÉ
EVERYDAY, NESTLÉ NIDO (FORTIGROW, 1+, 3+), CERELAC, LACTOGEN (1, 2, 3, 4
and RECOVER) and NAN ( 1, 2, AL110 and PRENAN).
Quality and Safety for our consumers is Nestlé’s top priority. This applies to our entire portfolio,
from foods and beverages to all our systems and services. To know more about Nestlé Quality
Policy click here.
With a promise of Good Food, Good Life, Nestlé Bangladesh continues to innovate across its
product lines to enhance people’s quality of life and contribute to a healthier future of
Bangladesh.

3. Nando’s- The Franchisor

Nando's is an international casual dining restaurant chain originating in South Africa. Founded in
1987, Nando's operates over 1,000 outlets in 35 countries. The logo is based on the Rooster of
Barcelos. Nando's specialises in Portuguese-style chicken dishes with various peri-peri
marinades.

Nando’s Bangladesh- The Franchisee

Nando’s was born in 1987 in South Africa, although the tale of Nando’s and our inspirational
Peri-Peri takes us back much further in time. From the humble beginnings, Nando’s Restaurants
have now opened in 34 countries on five continents around the world, launched in Dhaka in
August, 2007.

MGH Restaurants Pte. Limited is the Master Franchisee of Nandos in Bangladesh, and in Nepal.
With the first 550 square meter sprawling Flag Ship Store opened in Dhanmondi, Dhaka, MGH
opened the second 550 square meter store in Gulshan in 2009, the Premium Suburb of
Bangladesh.
The three-storied Gulshan Store prides of being fitted with Green Initiatives commencing from
usage of 150 years-old abandoned heritage-bricks recovered from a demolished site at Old
Dhaka, Rain Water preservation for day to day usage of water as well as RO (Reverse Osmosis)
process to reuse the daily waste water from the operations. Solar Panels have been installed to
power part of the store as a phase wise roll out.

There three new store locations being ear-marked for possible launches with in January, 2012.
The locations are at Banani, Gulshan-2, and at Karwan Bazar.

4. PepsiCo- The Franchisor

PepsiCo Inc. (PEP) is a leading food and beverage company that manufactures and distributes its
products in more than 200 countries. Food products that PepsiCo manufactures include chips,
flavored snacks, cereals, rice, pasta, and dairy-based products.

PepsiCo Bangladesh - The Franchisee

Transcom Group Limited is a Bangladeshi business conglomerate. The businesses under this
group include beverage, pharmaceuticals, newspaper, radio channel, electronics, foods, etc.
Transcom is the local agent or comprador of international brands. This group employs more than
10,000 people. Transcom Group is one of the oldest and biggest companies in Bangladesh. Their
operation in Bangladesh initially started in 1885 as a tea plantation company.

The company is the exclusive PepsiCo Franchisee for Bangladesh. TBL owns and operates three
modern plants in Konabari, Mawna and Chittagong for bottling the renowned soft drink brands:
Pepsi, 7Up, Mirinda, Slice, Mountain Dew, Pepsi Diet, 7Up Light and Aquafina water and
market leader by far. To deliver sustained growth in Bangladesh and move towards dominant
Beverage Company, delighting & nourishing every Bangladeshi, by best meeting their everyday
beverages needs & stakeholders by delivering performance with purpose, through talented
people.