1- The company operates in Fast-Moving Consumer Goods (FMCG) industry or Consumer Packaged Goods (CPG) industry. This company deals with the products that are sold rapidly, and at lower price than the outside market. For Examples non-durable goods such as packaged canned foods, beverages, toiletries, and other consumer goods ,paper and paper products, personal products, rubber, plastics, textiles, clothing, and footwear. Sector and segment of the product canned tomatoes Germany is the world’s largest importer of canned tomatoes, and 4th biggest importer of ketchup (2017). Germany is the country dealing in finished products as well as in remanufacturing. 2.3 to 2.4 million metric tons of tomato products are used by Germany. Most of the European countries like Spain Portugal supplies 70% of raw material to Germany. Germany exports paste to neighboring countries like Netherlands, Czech Republic etc. with a sale of EUR 26 million. Germany is the top most country to import canned tomatoes with approx. 238000MT of canned tomatoes imported last year in 2017. After importing of canned tomatoes Germany re exports the product to neighboring countries like UK, Poland, and Netherlands etc. for gaining more profits up to EUR12 and 12 million per year. Netherlands and Italy are the countries which exports 70% of canned tomatoes to Germany, as Germany have seen a increased growth over past 20 years. As they spend a lot of money between EUR 140 to 142 million over past 4 years in 2017 they imported 12100MT of product. As importing of canned tomatoes German exports has increased even faster in last year. In summary, Germany has a passive trade balance in accordance with tomato products. The fact that the consumer market is divided in segments allows companies and organizations to develop promotional campaigns targeting specific segments. For example business people for business class on airlines or executive automobiles. This means the company can develop products that better suit the consumer of segment. • Income • profession • age • family • values • Behavior 2- Competitors and Degree of Rivalry The German food & grocery retail market is dominated by the supermarket/hypermarket/hard discounter channel, with sales through these stores accounting for over 75% of the market value in 2017. Within this channel there are a number of large retailers operating. In addition, there exists a large number of independent or specialty retailers operating. In Germany, the market is fairly consolidated. There are four leading players in this market, namely 1. Aldi 2. Edeka 3.Lidl and 4. REWE accounted for over 60% of total food & grocery retail sales in the country. The leading players in this market are extremely well-entrenched and enjoy a high level of brand recognition that helps in gaining customer loyalty. However, the ability to exploit scale economies is they key success. Large-scale retailers benefit significantly from economies of scale and the ability to employ aggressive pricing schemes that smaller retailers struggle to match. In Europe, the existence of international supermarket buying groups further gives the leading players a significant competitive advantage. As food & grocery retail is a market in which price is very often the deciding factor in consumer choice, these large players enjoy a significant advantage. Consumers face negligible switching costs, meaning retailers fight increased pressure to secure consumers′ custom and loyalty by attempting to cut prices. Larger retailers are pushed into competitive pricing policies due to the limited level of differentiation across the basic product range. Rivalry is also increased by the close similarity of players, although they may attempt to differentiate through products and price. Leading players in the market have to diversify their offerings in response to multiple threats that are intensifying the competition level. Such threats include purely online retailers, budget stores and developing consumer trends, which place much greater emphasis upon having access to small, convenience stores in the center of towns and cities than used to be the case. Budget stores have forced leading players to engage in aggressive price reduction strategies which have resulted in significant changes to offerings in supermarkets and hypermarkets. In fact, many of the leading companies in this market now operate their own discount chains in response to the rise of hard discounters. In Germany, the discount culture is entrenched in this market, and the leading discounters Aldi and Lidl together accounted for over a quarter of retail sales in this market in 2017. The entry of Amazon Fresh to the food & grocery market has been a key factor in booming up rivalry, aided by the online retail giant′s $13.7 billion acquisition of Whole Foods in 2017. Amazon Fresh is seeing success in this market, with Amazon accounting for almost 19% of food & grocery sales online in this country in 2017. In Germany, the entry of Amazon is gave boost to the online retail segment of the market and let the leading players to be in pressure. Some companies operate in other markets as well. For example, REWE operates not only as a retailer, but also as a travel and tourism operator. This can help to absorb the temporary impact of declining food sales, or high supply price. This basic dependency gives rise to aggressive competition. 3. Threat of new competitors The food & grocery retail market in Germany is dominated by large multinational companies. The four largest retailers in this market, namely Edeka Zentral AG & Co KG, Schwarz Beteiligungs GmbH, Rewe Group, and Aldi Group, account for over 2/3 of the market. These companies are large-scale, established retailers, with operating businesses that benefit them as small retailers cannot afford it which results in monopoly and advantage to big companies. Strong brand name and rapidly changes controls the whole market. These may dominate new entrants. Nevertheless, the threat of new entrants are not secured by large retailers. Potential entrants may be encouraged by the relatively low entry and exit costs. There has been a rapid growth of health consciousness, plus an increasing number of consumers opting for a more ethical or organic range of goods. Germany has the second largest organic food market globally, behind the US. which indicates that the organic food market in Germany grew at a compound annual growth rate As such, while the food & grocery retail market as a whole is growing moderately, it is apparent that certain segments of the market are offering better growth potential. This forms attractive avenues for new entrants seeking to move into a niche area that offers inbuilt protection from pricing pressures and mainstream marketing. German consumers are price sensitive, as threat of new entrants is moderate which is evident in the dominance of discounters Aldi and Lidl in the market, which together accounted for over a quarter of retail sales in 2017. German consumers spend on average less than 11% of total household income on food, amongst the lowest in Europe. Companies that wish to enter on a large scale, for example through an acquisition, can achieve success; smaller start-ups will struggle to compete on price alone. However, Germany has a large number of wealthy consumers, many of which are willing to pay more for premium goods. As such, success can be achieved here for a smaller company looking to enter as niche retailer. While independent stores command only a small proportion of market sales, they are widespread. In 2017, German food & drink specialist stores generated $16.6 billion in revenue in this market, an increase of 1.1% on the previous year. What′s more, premium and specialty foods have higher price tags. As such, small scale entry is practically successful in this market. A key feature of the German market is the dominance of domestic players. Out of the top ten players in this market, eight are German. The top five players are domestic and account for over 70% of retail sales in the market. The failed attempt at market entry by Wal-Mart is a prime example of the difficulty foreign retailer’s face in entering this market successfully. REFERENCES 9.2 Market sectors and segments. (n.d.). Retrieved from https://www.ggspdt.com/92-market-sectors-and-segments.html CBI is the Centre for the Promotion of Imports from developing countries. (n.d.). Retrieved from https://www.cbi.eu/ What is consumer packaged goods (CPG)? – Definition from WhatIs.com. (n.d.). Retrieved from https://searchcrm.techtarget.com/definition/consumer-packaged-goods (n.d.). Retrieved from http://advantage.marketline.com.eztest.ocls.ca/Product?pid＝MLIP2818-0017&view＝d0e419

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