Organic Towel Exports (Scenario)
The Organic Towel Company (OTC) employs 400 workers at its facility in Liverpool, England, where the firm has been manufacturing 100% organic cotton towels for five years. OTC sells towels in the United Kingdom primarily to boutique hotels and specialty retail stores, as well as to individual consumers through the company's website. Recently, OTC managers attended a trade show in London where they made contact with numerous foreign market managers. OTC received a request from Earth Waves, an organic clothing store in Toronto, Canada, for a large order of towels. OTC had not been looking into expanding, but firm managers are seriously considering the opportunity to reach a global niche market with their towels.
Which of the following questions must be evaluated by OTC managers as a first step to exporting?
◦ What are the risks involved in exporting OTC towels to Earth Waves?
◦ Do Canadian towel companies have a high success rate when they export?
◦ Will OTC save money on domestic marketing by exporting?
◦ How can OTC adapt its distribution strategy in Canada?
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