EMBA COHORT 1BUAD 6085 MACROECONOMICS & THE GLOBAL BUSINESS

ENVIRONMENT

LECTURER: RAMESH RAMDEEN

PRESENTED BY: SYNERGY CONSULTING INC. DIRECTORS ~ Glennis Best-Pitt ~ Joanne Bourne-Sheppard ~ Joseph Frederick ~ Marcia Dorman-Joseph

SYNERGY CONSULTANTS

INC.

The Fish Processing Company of Tobago (FIPCOT) was established in 2009

It is a Government Special Purpose Company

Offices located at Glen Road, Scarborough , Tobago

Interview conducted on Monday July, 4th 2011 with

- Mr. Carlisle Jordan – Chairman - Mr. Cloyd Blackman - Director

Company Objectives Diversify the economy away from Tourism

Add value to the Fishing Industry and the Community

Company Structure – Traditional

Staff Compliment: 20 15 sailors/ crew members Five office staff s

A 65 foot long line vessel was purchased by the Tobago House of Assembly (THA) to facilitate the operations of the Company.

The vessel is highly equipped for deep sea fishing with features such as :

- 200 Gallon live bait well - A desalination plant - Radar - Fish Finder - Full Communication system onboard

Products Marketed; Yellow Fin Tuna (Primary)

Exported in its Raw Form approximately 10,000 lbs per month

Price per lbs is USD 5.00 To USD 6.50

By Catch (Secondary) Included are Red snapper, Kingfish & Flying Fish Sold on the Local Market Price per lbs is USD 0.90 to USD 2.00

Company generates revenues of approximately $630,000.00 USD per annum.

$600,000.00 from exports

$30,000 from by-catch sold on the local market

This is approximately $3,600,000.00 TTD annually (www.world fishing.net)

The Company is considered a Born Global entity since it began exporting soon after it commenced operations. This is so because the market for the product at home is too small for the quantity produced.

http://www.google.tt/imgres?imgurl=http://i01.i.aliimg.com/photo/v0/113239033/Yellow_Fin_Tuna.jpg&imgrefurl=http://www.alibaba.com/product-free/113239033/Yellow_Fin_Tuna.html&usg=__ot1WU7Nc4qNs_d5irL4POUDaza8=&h=600&w=800&sz=58&hl=en&start=2&zoom=1&tbnid=i_o0N9w8ihvo6M:&tbnh=107&tbnw=143&ei=gXcpTp_WJYTZgQfE4MWnCw&prev=/search?q=yellowfin+tuna&hl=en&sa=X&biw=1280&bih=554&tbm=isch&itbs=1

FIPCOT prides itself in their ability to adhere

to their commitment to the local fishing community on the island by not competing in the domestic market.

The by-catch is sold to the local fishermen

at a reduced price.

FIPCOT took advantage of a suggestion from the Testing Facility in Trinidad, that given the high quality of the Tuna sent to them for testing, that there was an opportunity for entry into the US market .

Grade of Tuna was determined to be Grade A THE HIGHEST QUALITY TUNA ON THE

INTERNATIONAL MARKET

The style of butchering used to prepare the fish for export prompted the Testing facility to recommend that Tuna be Exported to the United States Market

Price of one of these dishes range from US$35 to US$50

Competitors Other Caribbean Islands

Grenada Barbados Jamaica Etc

Japan China Kenya

Status of the Market Policy Problems in the United States because of

Dolphin Conservation Fish Stock Worldwide is depleting Rising demand for Raw Fish Loin for immediate

Consumption Time limit exist between Catch and Delivery to

Restaurant (48 hrs) in the USA Type of Tuna required by customers is Fresh Fish

The Involvement of the Company in the international Trade

In the Market Segment for Yellow Fin Tuna US imports for Tuna is 19,300 tonnes Market for Yellow Fin Tuna is 15,000 tonnes Trinidad and Tobago is among the Top Five

Suppliers of Tuna to the United States

Recommendation of Quality Assurance Company

Profits Margin very high

Accidental entry strategy employed Pull Factor : Ready International Market Market was recommended to company

Company is presently expanding into fish processing Key competencies of company were knowledge,

skills, sensitivity and values Company does not have a Research and

Development arm

Company’s products were suitable for the international market

Product had a great market potential There was a High Demand for Product, yet supply

was very low No screening was done to identify market

size and demographics Generally because it was a young

organisation with Governmental Support, the team believes it had the support base necessary to go international

Company plans to engage in Fish Processing

This suggests that the Company plans to diversify its operations. ( This measure is being used by the company to create a niche market locally)

No innovation being employed in maintaining a stable supply of Grade A Tuna

Company not yet safe guarding its raw materials base

For Grade A Yellow Fin Tuna, there exists no need for value added as it relates to the Target market.

Alternative use of by-catch - Seafood products may also be canned, cured (salted, smoked or salted and smoked) or prepared as delicatessen products.

Trade restrictions instituted by various trading blocs eg. European Union

Readiness of the firm to expand its international market base

The present nature of the local Fishing Industry.

It is not highly competitive Few Fishermen fish at that level (300m)

Company does not have a Research and Development arm

No screening was done to identify market size and demographics

There are two main categories of Macroeconomic Variables affecting the Company;

Endogenous Variables Business Fluctuation Raw Materials Availability

Exogenous Variables Inflation Employment Rate in Import Country Political Policy in Host Country Relationship between Host Country and Importer

Country

Company should consider Privatisation

Company Needs to Diversify Into Restaurant Operations

Establishing a Caribbean Cuisine Restaurant to Capitalise on the Value-Added in the Sushi Market

Company Needs to Evaluate present available fish stock

They need to know how long they can continue supplying their market

Seek assistance from Ministry of Trade and Industry to negotiate entry into the lucrative European market

Sustainability through Aqua Culture. Opportunity for company to expand business in this area and at the same time meet its growing demand for fish.

Develop a Brand – Instrument used to differentiate product from that of the competitors. Strong brand=value, image, reputation

The company has a competitive edge in their handling and preparation techniques as identified by the Testing facility.

This skill-set can be leveraged in the Region by training fishermen to attain HACCP standards as well as the adaptation of sound butchering techniques in fish processing.

The Fish Processing Company of Tobago (FIPCOT) has great potential for growth and sustainability. This is supported by the fact that it exists in a niche industry and has the necessary resources and support. However, management needs to be mindful of the change in the global environment.

WE THANK YOU FOR YOUR ATTENTION!