Company create ordinary items such as building materials,

Company Summary-

Company name-
Methanex corporation

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Methanex is one of
the biggest maker and provide methanol to major worldwide market in Europe,
Asia pacific, North America and South America. Methanex headquartered in
Vancouver, Canada, and works generation locals in Canada, Chile, Egypt, unused
Zealand, the joined together states and Trinidad and Tobago. Methanol utilizes
in delivering to chemical subordinates, which in turn utilized to create
ordinary items such as building materials, sprays, gums, plastics, coats,
polyester and variety of health and medicinal product.

Research objectives-

1.Economic barriers

·        
What are the important policies of other country regarding to
methanol business?

·        
How strong is the country’s political position?

·        
Is the country’s currency hard or soft?

·        
What is the GDP rate and tax rate of both countries?

2. Competition

·        
How many existing competitors in market?

·        
Which factors made them successful?

·        
How is the market analysis for both markets?

3. Understanding
local market

·        
What will be the business barriers with market?

·        
what factors will affect the pricing of products?

·        
 Will different language be
a barrier for business?

·        
how will be the attitude towards foreign product?

4. Transportation

·        
Which mode of transportation suits more for methanol in other
country?

·        
What are the packaging requirement for methanol?

·        
What will be the transportation issues in both countries? 

 

 

 

RESEACRH METHADOLOGY-

Research methodology will be useful for me to analyse the methanol
market in Nigeria and Cambodia. By qualitative and quantitative data, I will be
able to analyse economic issues of those countries, competition, government
taxes and policies, local market and transportation issues so that I can choose
the best of those two countries.

1.Economic barriers

Qualitative

·        
country’s economic position

·        
importing product

·        
political stability

Quantitative

·        
hard or soft currency

·        
GDP

·        
Tax rates

Source: Information in this part will be gathered from secondary data
through Economic freedom from search engine google, some news article and the
data provided is by the government website.

2. Competition

Quantitative

·        
Number of existing competitors

Qualitative

·        
market analysis

·        
Factors made them successful

Source: Information in this section will be gathered from Transparent
Nigeria and environmental export by google search engine results. It is a news
article based.

3.  Understanding local market

Quantitative

·        
number of factors affecting pricing

Qualitative

·        
business challenges in other countries

·        
attitude towards a foreign product

·        
language barrier

Source: Information is taken from news article; Economic freedom, world
business culture and export from search engine google and the data provided is
by government.

4. Transportation

Quantitative

·        
modes of transportation for methanol

·        
packaging requirement because methanol is extremely toxic to humans

Qualitative

·        
local transportation issues

Source: Information gathered from ttb; which is government authorized
data, guardian.ng and other online sources like blogs, news articles and
reviews.

Relevance of the data-

The collected qualitative and quantitate data for market research are
from government sources, some reputable websites such as economic freedom. The
data chosen will help for establishing their business in the chosen countries,
the data selected and mentioned is accurate and up to date from sources. Data
selected will be helpful to overcome the various barriers for the business in
Nigeria and Cambodia, the chosen countries.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Market
intelligence

1.   
Economic
barriers:

 

 

NIGERIA

CAMBODIA

Importing products

·  
Nigeria
is a developing country and Nigeria is the largest oil producer in Africa,
therefore importing products related to oil will be less.

·  
Cambodia
is in the least developed countries and there is not more production of oil
in Cambodia, therefore, there is a good scope for business over there.

Political stability

·  
Muhammadu
Buhari is the leader of Nigeria from March 2015.
 
 
·  
As
per political stability index Nigeria has an average political stability
which is -2.07 % (globaleconomy.com)

·  
Hun
Sen is the prime minister from 1998. He served 18 years towards Cambodia.
 
·  
Cambodia
is more stable than Nigeria in terms of political stability. And as per
political stability index is -0.10% (globaleconomy.com)

Hard or soft currency

·  
Nigeria
has the soft currency which is frequently fluctuating.

·  
Cambodia
has also soft currency which is also frequently fluctuating.

GDP rate

·  
As
per world bank 2016, the GDP rate of Nigeria is -1.541% (data.worldbank.org)

·   As per
world bank data 2016, the GDP rate of Cambodia is 6.883%
(data.world–bank.org)

 

 

NIGERIA

CAMBODIA

Tax rates

·  
30%
(company income tax) on Nigeria source income
 
·  
Royalty,
dividend, interest derived by the Nigerian company from outside Nigeria,
which is brought into or received through formal licensed financial institutions
are exempted.
 
·  
No
double taxation system. (www.mondaq.com)
 

·  
20%
company income tax
 
 
 
·  
The
Company must pay 15 % of interest, royalties and services and 10 % of rental
taxes.
 
 
 
·  
No
double taxation system (taxsummaries.pwc.com)
 

 

2.    Competition:

 

 

NIGERIA

CAMBODIA

The Number of existing competitors

·  
One
of the leading nations in the oil industry, therefore, there will be more
competition.
 
 
·  
Nigeria
has 8th largest oil industry in Africa and 90% of national earning
depends on the oil industry.

·  
Not more
resources available for methanol or any other oil components so there is less
competition.
 
·  
Cambodia
is importing methanol from other countries.

Market position

·  
Already
many oil and gas companies are there, therefore there will be risk entering
in the market.

·  
Less
competition in oil and gas industries so it will be easy to enter in
Cambodia’s market.

Maintaining relations

·  
Canada
has a high commission in Abuja and deputy commission in Lagos.
 
·  
Nigeria
has a high commission in Ottawa.
 
·  
Canada
and Nigeria are full members of the Commonwealth of nations.
 
·  
At
2016 Nigeria was Canada’s largest bilateral merchandise trading partner with
$1.88 million.
 
 
 
·  
Canada
also exports a wide range of products in Nigeria.

·  
Cambodia
also aids from Canada’s market access inventiveness for least developed
countries, which allows succeeding states quota-free and duty-free contact to
the Canadian market.
 
·  
Strong
bilateral ties.
 
(www.canadainternational.gc.ca)
 

 

 

3.   
Understanding
the local market:

 

 

NIGERIA

CAMBODIA

The Number of factors
affecting pricing

·  
Inflation
rate is 1.614% (world bank, 2016)
 
·  
National
income is -3.351% (world bank 2015)
 
·  
Nigeria
is the largest oil producer in Africa, that is the main reason affecting
price because producing price can be less.
 (export.gov)

·  
Inflation
rate is 3.022%
(world bank,2016)
 
·  
National
income is 6.77%
(world bank 2015)
 
·  
Demand
will also affect the pricing for methanol.

 
Business challenges

 
·  
Corruption
·  
Foreign
exchange restrictions
 
·  
Government
procurement
 
·  
Enforcement
of Intellectual property rights
 
(export.gov, 2017)

 
·  
Weak
rule of law
·  
Poor
infrastructure
 
·  
High
energy costs
 
·  
Underdeveloped
human resources
 
·  
Corruption
 
·  
Lack
of respect for basic human rights
 
·  
Limited
enforcement of intellectual property (export.gov, 2016)

 

 

NIGERIA

CAMBODIA

An Attitudes towards
foreign products

·  
Nigerian
consumers are obsessed with foreign-made good that is a decent opportunity.
 
·  
Nigerian
consumers have a negative image of ‘Made in Nigeria’ label and they like more
foreign products.
 (www.jstor.org)

·  
Cambodia
also welcomes foreign products in the country.

Language

·  
English
is the official language in Nigeria, therefore, it will be easy to
communicate.

·  
Khmer
is the official language in Cambodia which can cause a problem for foreign
clients.

 

4.   
Transportation:

 

 

NIGERIA

CAMBODIA

Modes of transportation

·  
Railways,
highways, waterways, pipelines, ports and harbors, airways

·  
Highways,
railways, waterways, seaports, and harbors, airways

Packaging
requirements

·  
Packaging
requirement is same in all countries because methanol is toxic for humans.
(www. Methanol.org)

·  
Packaging
requirement is same in all countries because methanol is toxic for humans.
(www. Methanol.org)

 
Local transportation
issues

 
·  
Congestion
 
·  
Parking
problems
 
 
·  
Increasing
accidents
 
·   Environmental pollution

 
·  
Serious
traffic congestions
 
·  
Inadequate
traffic management
 
·  
Lack
of mobility and poor transportations
 
·  
Increasing
road accidents
 
·  
Deterioration of
urban environment

 

  

 

 

 

Nigeria-

Company

Location

Specifications

Addax petroleum
 
 
 
 
 
Mobil producing Nigeria unlimited (MPN)
 
 
 
 
 
 
Statoil Nigeria limited
 
 
 
 
 
 
 
Nigerian AGIP oil company

Lagos,
Nigeria
 
 
 
 
 
Lagos,
Nigeria
 
 
 
 
 
 
 
Lagos,
Nigeria
 
 
 
 
 
 
 
Abuja, Nigeria

–         
Addax Petroleum’s
manufacturing properties contain 11 field centres with around 80 production
wells.
–         
Addax
Petroleum used to be the 5th major in Nigeria.
–         
(www.addaxpetroleum.com
 
 
 
–         
Mobil producing Nigeria
work over 90 offshore platforms including of about 300 manufacturing wells
–         
The Nigerian National
Petroleum Corporation (NNPC) MPN and Federal Government of Nigeria runs a
joint venture. The Federal Government has a 60 percent share and 40 percent
with MPN.
–         
(corporate.exxonmobil.com)
 
 
–         
Statoil Nigeria limited has share in the Agbami
project in Nigeria which is the major deep-water growth up now. The water
depth is assessed at 1,500 metres. The newest in subsea technology has
been applied for world’s largest floating production.
–         
In 2014 Statoil was
ranked as the fourth most sustainable company in the world and the most
maintainable energy company.
(www.statoil.com)
 
 
–         
AGIP has
been a subsidiary of the international petroleum company Eni.
–         
It operates in the shallow waters
offshore since 1980.
(www.eni.com)

 

Market Analysis-

Nigeria is Africa’s biggest oil producer and it contributes
95% of the foreign exchange earning because of Nigeria’s natural resources. In 2014, Nigeria produced about 2.39
million barrels per day, rendering to the U.S. Energy Information
Administration. 

In 2012, Shell, Exxon Mobil
and Total all broadcasted contract awards, and with the 40,000-bbl/d Bonga
North West field, which came online in 2014, these will likely to improve
imports of oilfield equipment/machinery in 2014 and going forward.
Nigeria’s oil and fuel
import percentage was 14 by December of 2017.

 

Success factors-

Nigeria
has already many companies serving oil and fuel therefore there is more
competition there and they also provide more oil and fuels with lower prices in
comparison with Methanex Corporation who is only proving methanol. Methanex
Corporation can improve their product range and they can also decrease the
prices for being successful in Nigerian market with other competitors.

 

 

 

 

 

 

 

 

 

 

Cambodia-

Company

Location

Specification

Chevron limited
 
 
 
 
SOKIMEX Group

Phnom Penh, Cambodia 

 
 
 
Phnom Penh, Cambodia

–         
appealed
to be the world’s major producer of geothermal energy
–         
more
downstream operations in Southeast Asia which is related with manufacture and
sale fuels
(www.chevron.com)
 
–         
Cambodia’s major petroleum company in
import and export within the country.
–         
It has not only well-known distribution
channel but also, they have other facilities like storage and warehousing.
(www.sokimex.com)
 

 

 

 

Market Analysis-

Cambodia imported approximately 1.2 billion tonnes of
petroleum in the first nine months of the 2015, up 12.51 % from the 1.1 billion
tonnes in the same dated last year, statistics by the Ministry of Commerce.
Cambodia’s oil annual consumption has touched some 1.5-2 million tons by last
year.

 

Success factors-

Methanex corporation is only providing methanol in Cambodia
but if they try and add some more oil and fuels to their business they can
achieve great success because Cambodia has less companies with oil and fuels
therefore it will be advantageous to Methanex corporation.

 

 

 

 

Conclusion-

 

Based
on market analysis and research, Cambodia matches with the company’s objective:

1)    To
find out economic position and political stability

·        
For importing methanol Cambodia is better than
Nigeria because Cambodia is under developing country and Nigeria is developing
and Cambodia has less resources for oil and fuel therefore Methanex corporation
should go there.

·        
Cambodia is more stable than Nigeria in terms
of political stability.

·        
 GDP rate
of Nigeria is obviously higher than Cambodia because Cambodia is still under
development.

·        
Tax rates are slight lower in Cambodia in
comparison with Nigeria because Cambodia is having a step ahead of development
therefore they will invite more international institution for business that can
give benefit to their country.

 

2)     To find information about local market

·        
There are various reasons that affect the
prices of the product like the inflation rate and national income, but price
will get more affected by demand of product. 
Nigeria has more natural oil resources therefore they will not import
more methanol, but Cambodia is not that rich in natural resources, so they will
go for import of methanol, in this situation Methanex Corporation can establish
their market in Cambodia.

·        
For any business there will be challenges and
for Nigeria and Cambodia some challenges are same as corruption and foreign
market exchange problem, but this kind of problems Methanex Corporation can
solve in Cambodia by the help of government.

·        
Both the countries have good attitude for
accepting foreign company but Methanex should go for Cambodia because there is
more demand for methanol.

·        
Language can be one issue in Cambodia because
their official language is not English, and Nigeria’s official language is
English.

 

 

3)    To get
the information about transportation system

·        
Mode of transportation, packaging requirement
and some transportation issues are mostly the same Nigeria and Cambodia. 

 

4)    To
know the market’s competitive condition

·        
Nigeria is richer in oil and gas resources
therefore there are more companies in Nigeria comparing to Cambodia. Therefore,
I prefer to go in Cambodia where competition is less, so Methanex Corporation
can easily and early establish their place in the market.

·        
Comparing to Nigeria Cambodia imports more oil
therefore Methanex Corporation can have advantage of exporting methanol and
other oils.

 

Action
plan:

·        
The first thing Methanex Corporation can do is
they need to collect the real-time data by market survey with the expertise
team of researchers.

·        
In my opinion, Methanex Corporation should
expand their product range even though they are at the top for serving
methanol, but they should have more variety.

·        
They should create a team of members
constituting market surveyor, some local businessmen and a person who has
knowledge of the regulations and law, that can be the benefit for the company
to establish relation with the local partners.

·        
Methanex Corporation should hire a consultant
for the issues regarding construction of factory and transportation so that
they can get an idea about the actual cost of the project.

 

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