Restarting Danbreds Activities in China

Abstract

The following report is to help Danbred understand the Chinese pork sector and which risks and opportunities there are for Danbred in increasing their presence in China. The report uses the genetic company Danbred as an example, but can be used by similar companies as well as other suppliers of the Chinese pork sector, to get a better understanding of the current market situation. Despite China having the worlds largest pig herd, the presence of foreign companies has greatly been reduced following the Covid-19 pandemic, long periods of unprofitability in the pork sector and increasing tensions between China and the West. This report can be used to get a better understanding of the current situation and how to navigate short- and long-term risks. To analyse the Chinese pork sector, the PIE-model is used to cover areas from politics, institutions and economy, similar to a PESTEL. From the analysis, the biggest challenges for both Chinese pork producers and for Danbred will be highlighted and listed in risk registers. The risks are then listed and analysed to get a better understanding of how they affect the two parties. Following the analysis suggestions on measures and contingency plans are made for Danbred, to use in increasing their activities in China. Danbred and similar companies can use this knowledge to allocate resources and set the right team to tackle the Chinese market. By following the suggestion, they will increase their chances of success in selling breeding animals and avoiding acting in a way not suitable to the Chinese markets. The focus on relationships and after sales services are important for Danbred to have success with their products in China and to increase sales. The escalating tensions between China and the West over the future of Taiwan are making companies nervous and giving flashbacks to what happened following the Russian invasion of Ukraine. In knowing the Chinese market and its risks as well as having a proper exit plan, foreign companies can be more confident in being in the Chinese market, but also be prepared for if the worst is to happen. For further perspectives I will be making a project structure for Danbred in China, with focus on the right team composition as well as control and monitoring measure to make sure Danbred are heading in the right direction and if not, that an exit plan is ready.