Growth Strategy for Vincor Essay

Vincor need to align itself in the marketplaceplace such that it can continue to be a market leader and grow internationally. The Canadian wine market is stagnant with limited gain opportunities in a few segments red, premium, varietal, and ice wines. Supply is always a big concern and goernment regulations for the bargain of alcohol must be considered. As a result of the changing environment, new prospects in the market and strategic growth in external markets (international) should be analyzed.Going forward, Vincors growth strategy needs to focus on markets where they can have substantial market penetration and be highly successful. The opportunities atomic number 18 as follows1) Expand into international markets via acquisition and restructure the current debt to reduce interest costs. Capitalize on the popular station name in the new market to achieve significant foreign growth.2) varied approach to cost reduction and focus on niches within Canada. Recover a portion of th e uphill grey market by developing new product packaging for the low-end wines (plastic or boxes).3) Build inversely beneficial partnerships with new glass bottle suppliers and develop a sales channel that will incur economies of scale for the price of bottles and increase margins or renegotiate with current suppliers to reduce costs and provide incentives by signing an exclusivity agreement.4) Zero in on the ice wine consumers by meeting the demand. Exploit the Inniskillin brand in the Canadian premium wine market in order to gain market share.5) pose a new product internationally through a partnership with a winery or vineyard by leveraging Vincors strong management team, international award status and prove sales force to sustain Vincors growth pattern.Expanding internationally through the acquisition of a community with strong branding would prove the best alternative, both in terms of timing and future growth potential. Developing a partnership in order to produce new prod ucts would take years and respectable time and effort before any gains would be realized. The varied approach would not produce generous growth to support an IPO, but many of these avenues will be addressed to reduce costs over the next several years.First six (6) to twelve (12) months Set up the team that will divvy up an international market study to determine which market, and more specifically, brand to penetrate. The team will include1. Jones and a market insight team (utilize services of a consulting firm that specializes in foreign winery acquisitions)2. capital of Mississippi and his mergers and acquisition (M&A) team3. Munroe for sales and market4. Investment banker The market insight team will bring in the data and develop a sound understanding of the targeted wineries and knowledge of the regulations of the country Recommendations will be make to M&A teamNext twelve (12) to eighteen (18) months Once a decision is reached, the investing banker and M&A team will conta ct the companies, begin their due diligence process and endure the final purchase The new winery will be integrated into Vincors portfolio and Munroe with his sales and marketing team will be responsible for its growthThe international acquisition will expand Vincor globally and provide for significant growth in its portfolio. At the same time, the desired Canadian relationships with suppliers will be cemented to reduce cost of sales and increase margins.