TABLE OF CONTENTS

Introduction of HuReMil Company.....................................................................................................3

2.1

Companys name.........................................................................................................................3

2.2

Country of Origin........................................................................................................................3

2.3

Product Line................................................................................................................................3

Where to be marketed?........................................................................................................................4
3.1
Identify and describe one product of your organization to be marketed for a relevant market
sector and justify the objective of the international expansion.................................................................4

3.1.1

Market Segmentation in Indonesia.......................................................................................4

3.1.2

The best way to distribute products meal-ready-to-eat.........................................................5

Factor of Considering in Indonesia......................................................................................................6

4.1
Discuss the country of your choice based distinctive features of doing business in a specific
country.....................................................................................................................................................6
4.2
4.2.1

Political stability:.................................................................................................................6

4.2.2

Business or individual tax system:.......................................................................................6

4.3

Economic Factors........................................................................................................................7

4.3.1

Exchange rates:....................................................................................................................7

4.3.2

Inflation rates:......................................................................................................................7

4.3.3

Import:.................................................................................................................................7

4.4

Social Factors:.............................................................................................................................8

4.4.1

Population............................................................................................................................8

4.4.2

Age factor:...........................................................................................................................8

4.4.3

Religion:..............................................................................................................................8

4.5

Political & Legal factors:.............................................................................................................6

Technological Factors:.................................................................................................................9

4.5.1

Transport system:.................................................................................................................9

4.5.2

Communication system:.......................................................................................................9

4.5.3

Geographical location:.......................................................................................................10

4.5.4

Natural or environmental disaster:.....................................................................................10

Strategy tripod for HuReMil...........................................................................................................11

5.1
Based on strategy tripod, project a business strategy and justify the specific rationale
that makes your idea a viable business opportunity.......................................................................11

VRIO Model for HuReMil................................................................................................................13

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6.1.1
By using VRIO Framework discuss on how your organizations plan for your product or
service in order to sustained the competitive advantage in the global marketplace for a long run.....13
6.2
7

Competitive advantages.............................................................................................................13

Market Entry to be used for HuReMil...............................................................................................15

7.1

Direct Exporting........................................................................................................................15

7.2

Joint Venture..............................................................................................................................15

7.3

Strategic Alliances.....................................................................................................................16

7.4

Ownership..................................................................................................................................16

Conclusion.........................................................................................................................................17

References.........................................................................................................................................18

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1 INTRODUCTION OF HUREMIL COMPANY

1.1 COMPANYS NAME
Our companys name is HuReMil. HuReMil stand for Human Ready Meal which is normally use
by military during war time. For now, this kind of food is available to the public. This product is
based on Food and Beverage industry. HuReMil basically can also be defined as Turbo Meal
which is very efficient to use during hard time such as natural disaster, emergency and to serve
for a homeless people which our company will focus on. This is because foods in HuReMil are
ready made and only need to warm before eat. On top of that, HuReMil is a healthy foods and
very suitable for anyone. Other than that, HuReMil foods also have a unique expired time which
is longer than any other ordinary fast food in the market.

1.2 COUNTRY OF ORIGIN

HuReMil origin country is Kuala Lumpur, Malaysia. We have one factory that produce variety of
foods and it covered all processes from raw material to finish products. The factory located in
Jalan Ipoh, Sentul. Approved by Ministry of Health, we can guarantee the hygiene level of our
products. Our factory also equipped with a latest technology machine that can work efficiently
and increase production level in order to meet our beloved customers demand.

1.3 PRODUCT LINE

HuReMil products focus on foods that suit with local taste. We provide some foods that can be
eat with bread and rice such as Chicken Curry, Chicken cooked with chilly mix with coconut milk
(Chilly Paddy Chicken), Beef Kurma and Serunding. In addition, we also produce our own
unique biscuit that we name it Energy Bank. This biscuit not like ordinary biscuit in the market.
It contains high calcium and vitamin that can help human survive in worst condition or situation.
Not only ready to eat food, we also have Energy Sparkling Water that come with a unique
packaging. What makes this water different from any other water in the market is some special
ingredients that can make one who need energy become more energetic. The packaging of this
water also really suitable to be use in any conditions. The packaging is hardly to break or
leaked.
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1 WHERE TO BE MARKETED?
1.1 IDENTIFY AND DESCRIBE ONE PRODUCT OF YOUR ORGANIZATION TO BE
MARKETED FOR A RELEVANT MARKET SECTOR AND JUSTIFY THE
OBJECTIVE OF THE INTERNATIONAL EXPANSION.

1.1.1

Market Segmentation in Indonesia

We choose Indonesia as it country has potential for growing profitable growth with regards to
market entry an economic growth and urbanization in Indonesia over the past decade has been
get along with fast growing modern retail food sector and by changes in food consumption
patterns. As Indonesia country the worlds fourth highest populated country that is expanding at
a rate of 2.9 million a year. Thus, we had examined changes in food consumption patterns and
measure the growth of modern food retail chains, packaged food purchases as well as we
providing our products based on demographic and trends including the middle, upper, and low
classes that focusing on peoples living in Indonesia mainly. Plus, we will provide ready-to-eat
meal at age population range between 21 and above because of its large size that will growth
the potential in demand and needs on their daily life.

Basically, the behavior of the students and workers tend to go supermarket or convenience
store that come equipped with microwave and hot water, so that it will making fast food easily
and this services would be able accessible to a large number in urban population, who prefer
fast food due to the lack of time and save money. Based on my researched on economic output
in Indonesia their largest sector in economy which is agriculture. Indonesia itself has a widen
land field which is plentiful of resources like dietary foods for instance rice, soybeans, and sugar.
Generally, we will use all these resources that I have mentioned above to create a meal ready to
eat based on their dietary food tastes but also provide a diversification product that can be
accessible and suitable their taste as well as long it is healthy food

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1.1.2

The best way to distribute products meal-ready-to-eat

The movement distribution a set of meal ready to eat in Indonesia has 2 ways which is in a
Modern retailing format is by food retailing through supermarkets, mini markets, hypermarkets,
and convenience stores in which it has increased in Indonesia over the last few decades.
Furthermore, the urban consumers are demand for convenience of large space hypermarket,
because people can buy anytime and anywhere by our products that hypermarket or
convenience store are able to operate business in 24 hours in a week compared to the
traditionally retailer. Secondly, Food safety assurance as modern outlets can protect fresh foods
from oxidization better than the unintegrated supply chains of the traditional sector. Thirdly,
information. In modern stores, all items are labeled with fixed prices, and shoppers themselves
can select the food items easily. In traditional markets, vendors sometimes select the item to be
purchased, and price bargaining is too commonly. Lastly, Comfort environment. Surrounded
with an environment and air conditioning are important aspects in Indonesias moist and
regarding warm climate.

Other facts about we want to distribute product by traditional retailing as such using mobile
stalls or other ways we will going to sell direct to customers whether at sidewalk and etc. plus,
HuMeRil Company will hire workers that are willing to distribute being as traditional retailer
division to sell our product as well directly at rural area. Despite, both ways has different target
in market segmentation which are the products will allocate at kind of different location in area
within urban cities and also at the rural area that comprises of middle and lower income. While
most Indonesians purchase their food from traditional retail outlets, modern food retail stores
sell an increasing share of food products and particularly packaged goods to urban consumers.
Unlike at Jakarta and Bandung in both of western Java modern retail food outlets we would not
necessarily put the lowest price as it because people who living in cities basically are rich, thus
those urban consumers afford to buy our product but different thing at rural area we decided to
put the lowest price for lower income at rural area.

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2 FACTOR OF CONSIDERING IN INDONESIA

2.1 DISCUSS THE COUNTRY OF YOUR CHOICE BASED DISTINCTIVE FEATURES
OF DOING BUSINESS IN A SPECIFIC COUNTRY.
For this question, our company will choose Indonesia as our country to do the business. So, the
best way to know about the country is by doing an analysis using a PESTLE method.

1.2 POLITICAL & LEGAL FACTORS:

Indonesia is considered as Republic country. It declared its independence on 17th August 1945 from
Japan so 17th August is the national holiday. Indonesia legal rules and regulations are based on RomanDutch law. Their constitution has abrogated by Federal Constitution in 1949 and Provisional Constitution
abrogated in 1950 which restored on 5 July 1959.
1.2.1

Political stability:

In Indonesia after every five-year election is being contested for president and vice president post by
direct vote of the citizenry. Last time it was held on 8 July 2009 (next to be held in July 2014). Susilo
Bambang has elected as president and Muhammad Yusuf Kalla is the Vice-President. Similarly, Cabinet
also appointed by the president. So for next 5 years there are more chances of stability of the government.
At this point we can see that the political factors in their country is quite stable because the government
keeps shuffle and have a new people in their organizations. This also can tells to our company that, the
country are safe to be penetrate for us.
1.2.2

Business or individual tax system:

Tax system has various rules and categories for example on first 25,000,000 income rate of tax is 10%
then on next 25,000,000 it is 15% and on next 50,000,000 it is 30%. In the same way Income Tax on
interest from Indonesian banks is fixed at a final 15% for both companies and individuals. For our
company, this tax can be considerable because the tax of 10% is when it reaches the target of income rate.
If our company are below than that, the government cannot charge us to pay the tax.

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1.3 ECONOMIC FACTORS

Indonesia is considered as a developing country. Due to the government policies and treasure of national
resources, their GDP growth has been increasing rapidly from last few years. They spend 23.5% of their
GDP to develop their nation. According to last announced budget they had revenues $92.62 billion and
expenditures $98.88 billion in 2008. They have hub of natural resources such as in Oil production, it has
23rd rank, in natural gas production and in export it is on 8th position.
1.3.1

Exchange rates:

1 MYR = 3,261.02 IDR

If the tax rate 10% are being applied to our company, it must reach around 7,500 MYR based on our
profit by selling the meal ready to eat product.
1.3.2

Inflation rates:

Inflation rate is still high but it has come down after a high of 20.7% in 1999. It was 9.9% in 2008
compare to 6.3% in 2006. The major reason behind it is economic downturn.
1.3.3

Import:

Due to change in population, income, import and export in Indonesia are increasing every year. The total
import in 2008 was $125 billion compare to $85.26 billion in 2007. The major import commodities are
machinery, equipment, chemicals, fuels and foodstuffs. The major import partners are Singapore 16.9%,
China 11.8%, Japan 11.7%, Malaysia 6.9%, US 6.1%, South Korea 5.4%, Thailand 4.9% (2008). In
addition, if we take a look at their main import product, mostly they are importing a machinery and
equipment tools more because they quite many the industrial place there but for the foodstuff is quite low.
It is because their citizens also are competing each other to sell their foods and it is all delicious. So, if we
are selling the food in a new way, we can confident our product are sold in that country.

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1.4 SOCIAL FACTORS:

1.4.1

Population

Indonesia has a large population, which is increasing at a steady rate. It is on the 5th position all over the
world with total 240,271,522 populations which is growing at 1.13%. The birth rate in Indonesia is
18.84births/1,000 and the mortality rate is 29.25 deaths/1,000 populations. The total life expectancy rate
is 70.76 years in which for male its 68.26 years and for female its 73.38 years. 52% of total population
live in urban areas which are increasing at3.2% every year.

1.4.2

Age factor:

Indonesia is considered as nation of young people. The total median age is 27.6years in which for male it
is 27.1 years and for female its 28.1 years.
From this age factors analysis, we can see that most of Indonesian are younger which are perfect to sell
our product also besides from sell it to the natural disaster people or homeless. As been stated before, it
contains an energy which keeps the people who eat it, will more energetics because most of the young
people are busy and have no time to eat proper meal.

1.4.3

Religion:

Indonesia is a multi-culture and religion country where people from different religion work there. If we
talk about majority it is a nation of Muslim with 86.1%, Protestant 5.7%, Roman Catholic 3%, and Hindu
1.8%.
Based on this analysis also, it is very confident to promote our product because most of the Indonesian are
Muslims and we also more focusing on halal foods and also the hygiene factors.

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1.5 TECHNOLOGICAL FACTORS:

1.5.1

Transport system:

Indonesia has effective and highly developed transport system with 139 airports, railways with 8529km
and water ways covering 21579km and major ports are Banjarmasin, Belawan, Ciwandan, Kotabaru,
Krueg Geukueh, Palembang, Panjang, SungaiPakning, Tanjung Perak, Tanjung Priok. It has one of the
largest merchant moraine with 971 in which 114 is already registered in foreign country.

1.5.2

Communication system:

The communication system in Indonesia is highly developed which maintained 17.33 millions of people
use landlines where as 83.3 million of people use Cellular mobiles in the same way there are 13 million of
internet users which is good sign for a country. It has interisland microwave system, HF radio police net
and domestic satellite communications system coverage which makes its communication system better.
The technology in Indonesia are quite impressive where our company do not need to worry much because
all their infrastructure are well manage and build. Most of the transportation and communication
technology giving us the ability to promote and deliver our product perfectly and just in time.

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1.5.3

Geographical location:

Its geographic environment is one of the most complexes and varied in the world. By one count, it has
situated in South-Eastern Asia between the Indian Ocean and the Pacific Ocean. It has total 1,904,569 sq
km area in that land is 1,811,569 sq km and water is 93,000 sq km. Basically it is hot and humid country.
At least 669 distinct languages and well over 1,100 different dialects are spoken. The nation encompasses
some 13,667 islands; the landscape ranges from rain forests and steaming mangrove swamps to arid
plains and snowcapped mountains.

1.5.4

Natural or environmental disaster:

Due to its geographic location, several times Indonesia has faced many natural disasters such as in
December 26, 2004; magnitude 9.0 earthquake caused a tremendously powerful tsunami in the Indian
Ocean and about 155000 people died and after this in May 26, 2006, in Feb. 2007, January 27, 2008 and
many times country has faced same trouble because of its location.
In the same way, due to its mountainous interior regions of Kalimantan, Sulawesi, and Sumatra, country
has faced deforestation, soil erosion and massive forest fires. In 1983, about 3 million hectares of prime
tropical forest worth at least US$10 billion were destroyed in a fire in Kalimantan Timur Province. The
disastrous scale of this fire was made possible by the piles of dead wood left behind by the timber
industry. Even discounting the calamitous effects of the fire, in the mid-1980s Indonesia's deforestation
rate was the highest in Southeast Asia, at 700,000 hectares per year and possibly as much as 1 million
hectares per year.
Therefore, based on this natural and environmental disaster, this country is our perfect choice to penetrate
and aggressively promote our product in order to make all the disaster people to survive with our healthy
foods and energy water to keep them all healthy and not in suffer anymore.

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2 STRATEGY TRIPOD FOR HUREMIL

2.1 BASED ON STRATEGY TRIPOD, PROJECT A BUSINESS STRATEGY AND
JUSTIFY THE SPECIFIC RATIONALE THAT MAKES YOUR IDEA A VIABLE
BUSINESS OPPORTUNITY

The industry based of view is established in the supposition that the procedure
utilized by MNEs is controlled by the conditions inside of the business of core
interest. Likewise, the asset based perspective tends to thin execution and global
business system to assets in particular firms. The totaled perspectives are elements
of examination discoveries did in situations whose organizations are apparently
institutionalized and stable. In the interim these perspectives have not possessed
the capacity to manage the annoying inquiries acted by methodology like respects
speculation areas for the HuReMil organization. Because of the industry of HuReMil
are easily get the resource and the business are one of the favorite local food in the
country.

After that, the HuReMil have they own competitive advantages one of them
are that the secret ingredient of HuReMil food contain this is the tangible assets. For
the intangible assets, everything else that has no physical vicinity however can at
present be possessed by the organization. Brand notoriety, trademarks, protected
innovation are all elusive resources. Dissimilar to physical assets, brand notoriety is
assembled over quite a while and is something that different organizations can't
purchase from the business sector. Immaterial assets more often than not stay
inside of an organization and are the principle wellspring of reasonable upper hand.

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In the organization we do the institution based view by doing a third leg of

the strategy tripod that show in the figure 1.

Figure 1

This figure show how the organization to function well and in good
performance by doing the best strategy. In the industry based competition our
organization are best in the competitive advantages the other industry cant
compete because of the secret ingredient that our organization provided. In the
form of resources and capabilities, our organization one of the flexible in the country
and easily adapted with the environment. Then, the conditions and transitions of
our organization are very stable and very accepted from the local of the area either
in urban and rural area.

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3 VRIO MODEL FOR HUREMIL

3.1.1

By using VRIO Framework discuss on how your organizations plan for your
product or service in order to sustained the competitive advantage in the global
marketplace for a long run.

3.2 COMPETITIVE ADVANTAGES

The industry mapping shows a lot of competitors inside the food industry and several
substitutes. Hence, to survive in the fast food industry, HuReMil needs to have sustained
competitive advantages and in order to better understand them, here is the developed a VRIO

EXCELLENT
RELATION
WITH
SUPPLIERS
CUSTOMER
SERVICE
BRAND NAME
&
REPUTATION
CONCEPT
INNOVATION
MANAGERIAL
KNOWLEDGE
& SKILLS
PRODUCTION
PROCESS
EFFICIENCY
QUALITY &
WIDE RANGE
OF PRODUCTS
FINANCIAL
CAPACITY

COMPETITIVE
IMPLICATIONS

VALUE

RARITY

INIMITABILITY

PARITY

PARITY
PARITY

TEMPORARY
ADVANTAGE
SUSTAINED
ADVANTAGE
SUSTAINED
ADVANTAGE
SUSTAINED
ADVANTAGE
SUSTAINED
ADVANTAGE

analysis. This framework is used to evaluate the resources and capabilities of the firm,
explaining if they contribute or not to sustained competitive advantage.
Table 1 VRIO framework
Page | 13

The fast casual dining concept of HuReMil is an innovation controlled by few companies in the
Malaysian fast-food market, because it is extremely hard to offer great quality products for
affordable prices in a short period of time. HuReMil further offers a greater variety of products
than the competition. As the HuReMil is one of the most emblematic Asian dishes and has an
extreme emotional value to the Asian consumer, HuReMil is giving back the status that it
deserves in a moment where many international fast food chains seem to be taking over in
Malaysia. In fact, eating in HuReMil is an improved ritual with a clean and refined aesthetic
where everything still suggests the traditional Asian feeling of the ritual. In order to operate with
the concept mentioned above, HuReMil managers negotiate frequently with its suppliers and
use their knowledge and skills to operate with an efficient production process, with strict
measurements defined to assemble each meal. Finally, with a strong investor (Syed Mokhtar AlBukhari) as partner, HuReMil is a business financially well-structured and disciplined, with the
financial capacity to expand to the main shopping centers of the country and to consider
international growth.
To conclude, the value proposition of HuReMil lies in the innovation in the product and in the
very strong price and quality relationship. There are many important resources that allow the
company to offer such value for the customers. The rarest and difficult to imitate are the
managerial knowledge and skills, the efficiency of the production process, the financial capacity
and the quality of the wide range of different products and ingredients.
Nevertheless, what really makes the difference for the company, more than individual resources,
is the combination of resources thats what really has value, is rare and difficult to imitate. As
so, HuReMil has competitive advantage, but the company will only be able to sustain it with
organizational improvements in order to grow through franchising the company needs to
optimize and standardize processes.

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4 MARKET ENTRY TO BE USED FOR HUREMIL

There are many entry strategies, but to have a successful market entry, it begins with evaluating
possibility, factors such as the trends, culture and nature of the competition and the opportunity.
HuReMil selected country for investment is Indonesia for now, it is because we share the same
norms and culture like we used to in Malaysia which ease the process of doing our business
there. But somehow we need to have a perfect fit strategy for our business to run smooth as
well. There are several entry strategies that we chose to run our business listed below:

4.1 DIRECT EXPORTING

Exporting can be used if we prefer to have less risk of operating our business there in
Indonesia. And the good thing about exporting in Indonesia is because that both countries are
part of ASEAN, which means we probably will have less taxation, quotas and other exemption
for our businesses. But there is a consequence is since we have a very unstable exchange rate
of our Ringgit Malaysia, we probably will have trouble if the exchange rate fluctuates so sudden.
Likewise, we cant follow up their trend of food. since we are producing in home country.

4.2 JOINT VENTURE

If possible, JV would be an interesting choice to establish our business there step by step. In
order to learn their culture, we need to partner with the host country company such as
Blambangan Food and etc. perhaps threat of competitor would turn in to an opportunity. By
doing so we can learn their culture and slowly catching up with the other competitor to rise to
the surface of the competing arena. But the problem is that we dont have the full control over
the management of the JV company, and some partners may have different views on
expectation of how the company should be. But it can be overcome by map out in advance of
what they expect to achieve and how it should be, so that there will be less conflict when we
start to run our business. So far this are the choice that will probably fit with the current situation,
since we share risk and profit together.

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4.3 STRATEGIC ALLIANCES

If we could make a strategic alliance with the government, we might have a chance to be a
vendor of their choice which will bring more sustainability to our company. Thus, there is a big
profit coming ahead if there is disaster such as tsunami, earthquake etc. and the government
would be need of us to supply food to the victims. Furthermore, government might be needing
us to make MRE for their army supplies if we able to compete between the local vendor that
already exist in the market. On another viewpoint is that we can also create two or more SME
host/home country company food industries to have the resources, skills and knowledge of
running this business to compete against the big existing company. By doing so we could
achieve the economics of scale, which can lower our production cost by pooling resources to
each other. Somehow every alliance has it weakness such as overpowered by other parties, we
might have ended up to follow the order of the other partner since they have bigger share, but if
there is a contract which limit the power of control between two or more parties it should be fine.

4.4 OWNERSHIP
This strategy would come after we have a very stable business to run 100% on our own control.
From our viewpoint, we think that we have to do the ownership after we can walk on our foot
from JV, with huge capital, we can build our own company to have full control over it to reduce
the risk of being overpowered by the other partner. It is a wise decision, but we have to monitor
very careful on the capital, spending and return since now we have no aids from our partner,
which is why JV or Exporting should come first before establishing our very own company, learn
from the locals, adapt to the culture and get used to the environment there in Indonesia. It may
not take a long time to adapt to the situation since we share the same norm with Indonesia as
well.

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5 CONCLUSION
In the nutshell, it is important to know the culture of the country first before make any business
or dealing with them. That is why we should take the closest country which is Indonesia
because the norms and value that we practice are most likely the same as theirs. Thus, there
would be certainly few issues regarding the communication, perhaps there is a chance that we
do not face any problem with the communication at all. But any strategies that we take will face
some problem, it is how we manage our problem into an opportunity. As we know, strategies
can change in time based on the current situation, if the situation arent good for the strategy we
will have to shift to another, as for example if the JV does not work well with each other anymore
we should try another partner or shift into direct export strategies, it really depends. Therefore,
every decision has to be perfectly analyzed before put it into action to minimize possible risk in
order secure our future. Because you will never be going to guess whether there will be rain
coming, but certainly we need an umbrella if it does.

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6 REFERENCES
ASAE Center, 2010. About US: Content. [Online]
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Canvassco, 2015. Indonesia Pestle Analysis 2015. [Online]
Available at: http://www.slideshare.net/Canvassco/indonesia-pestle-analysis-2015
[Accessed 23 November 2015].
FAO Corporate Document Repository, 2013. Chapter 7: Market Entry Strategies. [Online]
Available at: http://www.fao.org/docrep/w5973e/w5973e0b.htm
[Accessed 14 November 2015].
Gerrard, J., 2014. Indonesian Ready-to-eat Food Market set to Increase. [Online]
Available at: http://www.foodengineeringmag.com/articles/92563-indonesian-ready-to-eat-food-marketset-to-increase
[Accessed 13 November 2015].
International Market Bureau, 2011. The Indonesian Consumer - Behaviour, Attitudes and Perceptions
Toward Food Products. [Online]
Available at: http://www.agr.gc.ca/eng/industry-markets-and-trade-/statistics-and-market-information/byregion/southeast-asia/the-indonesian-consumer-behaviour-attitudes-and-perceptions-toward-foodproducts/?id=1410083148749
[Accessed 26 November 2015].
The Ready Store, 2008. About Us: The Ready Store. [Online]
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