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Peruvian Traditions SAC PRESENTED by Díaz Mo

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Peruvian Traditions SAC PRESENTED by Díaz Mo PONTIFICIA UNIVERSIDAD CATÓLICA DEL PERÚ ESCUELA DE POSGRADO Consulting Report - Peruvian Traditions SAC THESIS FOR THE DEGREE OF MASTER IN BUSINESS ADMINISTRATION GIVEN BY PONTIFICIA UNIVERSIDAD CATÓLICA DEL PERÚ PRESENTED BY Díaz Montalván, Sarai Abigail Advisor: Pablo Arana Surco, August 2019 Acknowledgments I would like to thank my colleagues Rachel Shen, Yan Chen and Thilo Tamme promptly for being part of this consulting group, and for their effort, time and dedication throughout the process. Similarly, to CENTRUM Business School and especially to professor Pablo Arana, for his guidance and constant support. Finally, Peruvian Traditions company that allowed us to make this report a reality. Dedications To my parents Nancy Montalván and Juan Díaz for all their effort, guidance and love, without whom it would have been impossible to reach this point and to whom I deeply appreciate their trust. To God who is the owner of all things. Abstract Peruvian Traditions is a small family business dedicated to the manufacture and export of alpaca garments. Currently, it has two brands White Label (Peruvian Traditions itself) and Norgäte and is aiming to expand its export process to Europe. Within the process of collecting information and analyzing the company, it was detected that the problem was the lack of differentiation between one brand and another which leads them to be "stuck in the middle". As a result, solutions were proposed for the problem determining that offering new product line called Alpaca Basics based on pre-existing garments within the Norgäte collection and on which it has been detected quite welcome, would be the best. The framework for this product line is the lean start-up methodology that is characterized by the formulation of a hypothesis and a testing process under continuous customer feedback that allows reaching a desired market-fit. Based on a previous analysis based on the segmentation, targeting and positioning (STP) the Netherlands was identified as target market. For the success of the product line, a 4P marketing campaign is required: product, place, price and promotion, which highlights the use and improvement of the current Peruvian Traditions website and a Google Ads campaign. To measure the results, three indicators will be used: number of visits through the web, conversion ratio and sales ratio. Subsequently, a scenario analysis is carried out taking into account three perspectives: negative, neutral and positive. Taking the neutral perspective as a reference, an increase in the number of visits is identified, from 1,460 to 4,380 visits per year. Which could generate an increase in the number of customers from 13 to 63. Resumen Ejecutivo Peruvian Traditions es una pequeña empresa familiar dedicada a la fabricación y exportación de prendas de alpaca. En la actualidad cuenta con dos marcas White Label (Peruvian Traditions) y Norgäte y se encuentra en la mira de expandir su proceso de exportación a Europa. Dentro del proceso de recopilación de información y análisis de la empresa se detectó que el problema era la falta de diferenciación entre una marca y otra lo cual los lleva a estar "stuck in the middle". A raíz de ello, se plantearon soluciones para la problemática, de ahí se determinó que la mejor solución sería lanzar una nueva línea de producto llamada Alpaca Basics basada en prendas preexistentes dentro de la colección de Norgäte. El marco para esta línea de producto es la metodología lean start-up que se caracteriza por la formulación de una hipótesis y un proceso de testeo bajo una continua retroalimentación del cliente que permite llegar a un anhelado market-fit. En base a un previo análisis, basado en la segmentación, focalización y posicionamiento (STP) se identificó que a Países Bajos como mercado objetivo. Para el éxito de la línea de producto se requiere de una campaña de marketing basada en las 4P: producto, plaza, precio y promoción, en donde destaca el uso y mejora de la actual web de Peruvian Traditions y una campaña de Google Ads que la respalda. Para medir los resultados se utilizaron tres indicadores: número de visitas a través de la web, ratio de conversión y ratio de ventas. Posteriormente se realiza un análisis de escenarios tomando en cuenta tres perspectivas: negativa, neutral y positiva. Tomando como referencia la perspectiva neutral, se identifica un incremento del número de visitas, pasando de 1,460 a 4,380 visitas por año. ii Table of Contents List of Tables ...................................................................................................................... vi List of Figures.................................................................................................................... vii Chapter I: General Situation of the Organization ............................................................. 1 1.1. Presentation of the Organization ................................................................................ 1 1.1.1. History and milestones ....................................................................................... 1 1.1.2. Vision................................................................................................................. 3 1.1.3. Mission .............................................................................................................. 3 1.1.4. Values ................................................................................................................ 4 1.1.5. Peruvian Traditions strategic objectives .............................................................. 5 1.2. Industry Analysis (Porter´s Five Forces) .................................................................... 6 1.2.1. Bargaining power of suppliers ............................................................................ 6 1.2.2. Bargaining power of buyers ................................................................................ 7 1.2.3. Threats of new entrants....................................................................................... 8 1.2.4. Threats of substitutes of products........................................................................ 9 1.2.5. Extent of competition ....................................................................................... 10 1.3. External Analysis (PESTE) – Opportunities and Threats .......................................... 11 1.3.1. Political factors................................................................................................. 12 1.3.2. Economical factors ........................................................................................... 16 1.3.3. Social factors .................................................................................................... 21 1.3.4. Technological factors ....................................................................................... 24 1.3.5. Environmental factors ...................................................................................... 26 1.3.6. Summary of opportunities and threats ............................................................... 28 1.4. Internal Analysis (AMOFHIT) – Strengths and Weaknesses .................................... 28 1.4.1. Administration and management (A) ................................................................ 29 iii 1.4.2. Marketing and sales (M) ................................................................................... 30 1.4.3. Operations and logistics (O) ............................................................................. 33 1.4.4. Finance and Accounting (F).............................................................................. 34 1.4.5. Human resources (H) ........................................................................................ 35 1.4.6. Information systems and communication (I) ..................................................... 36 1.4.7. Technology (T)................................................................................................. 36 1.4.8. Summary of strengths and weaknesses ............................................................. 37 1.5. SWOT Analysis ....................................................................................................... 38 Chapter II: Key Problem .................................................................................................. 40 2.1. Identified Problems .................................................................................................. 40 2.1.1. Product ............................................................................................................. 41 2.1.2. Process ............................................................................................................. 44 2.1.3. People .............................................................................................................. 47 2.2. Key Problem (substance, location, ownership, magnitude, time perspective) ............ 49 Chapter III: Literature Review ........................................................................................ 52 3.1. Literature Mapping .................................................................................................. 52 3.2. Literature Review .................................................................................................... 52 3.2.1. Value creation .................................................................................................. 52 3.2.2. Marketing strategy ...........................................................................................
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