Edita Foods: Prospects for International Expansion to

Jordan and South Africa

Case

Author: Marina Apaydin & Hend Mostafa

Online Pub Date: April 06, 2016 | Original Pub. Date: 2016
Subject: Comparative Management, Strategic Management & Planning, International Strategic
Management
Level: Intermediate | Type: Direct case | Length: 5395 words
Copyright: © Marina Apaydin and Hend Mostafa 2016
Organization: Edita Foods | Organization size: Large
Region: Northern Africa, Southern Africa, Western Asia | State:
Industry: Manufacture of food products| Retail trade, except of motor vehicles and motorcycles
Originally Published in:
Publisher: SAGE Publications: SAGE Business Cases Originals
DOI: http://dx.doi.org/10.4135/9781473974555 | Online ISBN: 9781473974555
SAGE SAGE Business Cases
© Marina Apaydin and Hend Mostafa 2016

© Marina Apaydin and Hend Mostafa 2016

This case was prepared for inclusion in SAGE Business Cases primarily as a basis for classroom discussion
or self-study, and is not meant to illustrate either effective or ineffective management styles. Nothing herein
shall be deemed to be an endorsement of any kind. This case is for scholarly, educational, or personal use
only within your university, and cannot be forwarded outside the university or used for other commercial
purposes. 2019 SAGE Publications Ltd. All Rights Reserved.

This content may only be distributed for use within PENN STATE.
http://dx.doi.org/10.4135/9781473974555

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Abstract
The case discusses Edita Foods, an Egyptian company that produced a variety of bakery prod-
ucts such as cakes, croissants, and crispy crackers. The company was able to establish itself
in the Egyptian market and build a strong reputation. Moreover, Edita started exporting its prod-
ucts to different markets in the Middle East and became available in 15 countries. The company
employed more than 2,000 employees and became a market leader in Libya, Yemen, Palestine,
and Iraq.

In order to sustain its position in the market and develop its regional existence, Edita decided to
consider expanding further to new markets internationally. The company was considering Jor-
dan due to its close location, and the similarity between the Egyptian and Jordanian markets as
they share similar languages, cultures, and religions. On the other hand, Edita was consider-
ing expanding to South Africa to increase its revenues, explore a new market, and benefit from
the trade agreements signed between South Africa and Egypt. How should Edita Foods decide
where and how to grow internationally? What kinds of questions should the company consider
in doing so?

Case

Learning Outcomes
The case can help students to familiarize themselves with relevant analysis for choosing among possible new
markets for expansion, as well as evaluating and prioritizing critical variables. It also encourages students to
compare different entry modes and choose the most suitable for the company and the country.

Introduction
“[The food industry in Egypt] has one of the best-managed export councils run by some of the most
outstanding, experienced, and dedicated businesspeople in the country.”

—Eng. Rachid Mohamed Rachid, Egypt's former minister of trade and industry

Edita Foods produced an array of bakery products from cakes and croissants to crispy crackers. In Egypt,
it managed to create a solid reputation and an unparalleled position in consumer minds. By 2014, the com-
pany employed more than 2,000 employees in two production facilities in 6th of October City and 10th of
Ramadan City. The company had done spectacularly well in the Egyptian market and had gained a big share
of that market. This allowed Edita Foods not only to effectively satisfy the Egyptian market but also to export
15 percent of the total company production to other countries. It currently exports to 15 countries in the re-
gion, including Iraq, Libya, Palestine, Syria, Yemen, Oman, Tanzania, Saudi Arabia, Kuwait, Kenya, Morocco,
Tunisia, Albania and Lebanon, and it is the market leader in a number of them, including Libya, Yemen, Pales-
tine, and Iraq. Edita Foods was looking forward to developing its regional existence and covering the whole
region. As a result, Edita Foods might consider further international expansion in Jordan and South Africa.

The key element that made going to Jordan a worthwhile decision was the relative geographical proximity
to Egypt, as this was a key aspect for the fresh delivery of food products. Moreover Jordan had a culture,
language, and religion that was similar to that of Egypt. On the other hand, South Africa had many trade
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agreements with Egypt which minimized tariffs and made it an attractive market for Edita. Moreover, the com-
pany could build on its success in Kenya and Tanzania to expand to other similar markets such as South
Africa. The potential to realize significant revenues in South Africa also encouraged Edita to consider expand-
ing there. The business environment of both Jordan and South Africa was expected to improve in the long
run. Furthermore, the gross domestic product (GDP) growth rate in these two countries was higher than the
population growth rate, meaning that there would be room for economic development. This implied that the
standards of living will improve, which potentially enlarges Edita Foods' target market. In order to take such
a step, Edita Foods needed to address the following questions: Where and how should the company grow
internationally? What kinds of questions should the company consider in doing so?

A Macroeconomic Overview of Egypt

Located at the crossroads of Africa, Europe, and the Middle East, with the Nile River passing through, Egypt
had been a center for trade throughout the centuries due to its prominent location. Egypt had been a less
developed country for several decades, but recently, it has become recognized as an emerging country with
high potential due to its growing gross domestic product (GDP). Egypt's GDP reached $551.4 billion in 2013.
According to the CIA's World Factbook, in 2014, Egypt ranked 24th in GDP as measured by purchasing pow-
er parity. However, due to political instability in the country since 2011, Egypt's real growth rate decreased
from 2.2 percent in 2012 to 1.8 percent in 2013, ranking it the 150th country. Egypt's budgeted expenditures
reached $80.42 billion in 2013, while revenues reached $45.57 billion.

In 2014, Egypt's population was approximately 87 million with about 19 million living below the poverty line,
which was a large percentage of the population. The CIA Factbook estimated the labor force to be 28 million
people, but 13.4 percent of them were unemployed. Unemployment was a well-known problem in Egypt; it
ranked 137th out of the 203 countries in the world in 2014 with respect to unemployment, according to the
CIA Factbook. That unemployment rate of 13.4 percent was an increase from the 2013 rate of 13.2 percent.
As a result of the increase in unemployment and the increase in the population under the poverty line, the
literacy rate reached only 73.9 percent in 2014.

In 2013, Egypt was faced with an increase in the inflation rate, which reached 9 percent as compared to 7.1
percent in 2012, making Egypt 205th out of the 223 countries. The Egyptian government exerted significant
efforts to solve its external debt problem by encouraging exports and enhancing trade. Additionally, Egypt
was able to benefit from large, external debt relief that had reduced this debt from 103 percent of the GDP in
2004 to about 87 percent of GDP in 2008 and enhanced the country's macroeconomic situation as a whole.
However, due to the political instability in Egypt since 2011, the public debt increased from 88 percent of GDP
in 2012 to 92.2 percent in 2013.

The Food Industry in Egypt

The food and beverage (F&B) industry had been important in Egypt since pharonic times. Two of the main
drinks back then were wine and beer. To make beer, barley was moistened with water and then ground and
kneaded into dough. The dough was baked into bread. The bread was then soaked in water and left to fer-
ment. Fruits such as dates may have been added at that point to sweeten the mixture. After the mixture was
fermented, it was filtered through a piece of cloth to remove any lumpy texture and then stored in jars for
drink.

Bread was a favorite food of the ancient Egyptians. Barley, emmer (a type of wheat), and spelt were the main
grains used in making bread. After the grain crop was harvested, it was threshed to remove the outer chaff.
After the threshing, the wheat was placed in a bowl and pounded with a pestle to make coarse flour. To make
fine-grade flour, the grain was ground between two stones. Then, ingredients were added to make dough that
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was fried or baked into bread. The food industry continued to be of great importance in Egyptians' lives across
many millennia and has developed ever since.

The Egyptian food processing industry accounted for 17.1 percent of the country's manufactured value added
in 2002 compared to 12.6 percent in 1992. Although this was considered lower than the average for the Mid-
dle East region (20.2 percent), the rate of growth in Egypt (7 percent) was higher than that in the region (4
percent).

In 2009, many multinational food-producing firms operated in or exported to Egypt. “With 117 new factories
and LE 4 billion worth of new investments in 2004–05, processed food was one of our fastest growing in-
dustrial sectors and the best turnaround of the year,” explained Helmy Abouleish, managing director of the
Industrial Modernization Center under the Ministry of Trade and Industry. The largest share of the industry
expansion came from new Egyptian ventures, many of them funded by the investors from the Gulf countries.

Food-processing firms adopted an ambitious export-led growth strategy that could serve as a blueprint for
other manufacturing sectors. This strategy was based on highly targeted government assistance to this sec-
tor and on private-sector know-how in food processing. Over the past 20 years, many international players
entered the market through either direct investments or partnerships. These international companies have in-
cluded Nestlé, Cadbury, Kraft, Hero, and many more.

Many changes occurred in the F&B industry in Egypt. The large competition from international brands forced
Egyptian companies to increase their production efficiency to be able to compete. Moreover, consumers be-
came more aware of the quality, safety, and packaging of the product.

Edita Food Company Background

Edita Foods was one of the leading companies in packaged bakery products in Egypt and the Middle East.
It was founded in 1996 in a joint venture between Chipita International and the Berzi family. Edita first in-
troduced a chocolate-filled croissant, Molto, in the Egyptian market, and soon the name “Molto” became a
generic name for a filled croissant in Egypt. At the time, the company was focusing on delivering products
that were not just tasty and filling, but also healthy and nutritious.

Edita then introduce its second innovative product, Bake Rolz, a healthy salty snack. In 2003, Edita bought
Hostess, the snack cake factory in Egypt, and introduced its snack cakes in the market. Since its establish-
ment, Edita has become known for its consistently high-quality products that include Molto croissants (with
sweet or savory fillings); Hostess and Todo snack cakes; and flavored toffee, candy, and jelly sold under the
Mimix brand. Its products are sold in 15 countries in the Middle East, Africa, and Asia

The competitive advantage of the company lies in its high-quality products, which were made in the state-
of-the-art production facilities located in both 6th of October City and in 10th of Ramadan City, both on the
outskirts of Cairo. The factories were designed to accommodate the demand for a wide and growing market
while supporting the company's mission of high-quality and efficient production.

Edita Foods factories were equipped with 11 automated, high-tech production lines and produce 34 different
products. The manufacturing sector in the company was established and organized to meet high standard
levels in both quality and productivity. Edita Foods had well-established laboratories equipped with the most
recent technology and instruments subjected to regular calibration in order to revise and inspect all materials
delivered to the production facilities and then inspect them during each stage of production.

Edita Food's vision was “to be a pioneering company in bakery products in Egypt and the Middle East.” The
company was certified for the hazard analysis and critical control point procedure (HACCP), which was used

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in the food industry to identify potential food safety hazards, so that key actions, known as critical control
points (CCPs), can be taken to reduce or eliminate the risk of the hazards. The company also implemented
the ISO 22000 food safety management system requirements to meet and exceed global food safety regula-
tions.

Edita's products were consumed by different age brackets. Each product was targeted at a different market
segment. For example, Molto, the chocolate filled croissant and Todos the snack cakes were targeted at
school and university students between the ages of 5–17. Bake Rolz, the salty snack however, was target-
ed at university students and young working graduates between the age of 15–35. Mimix was targeted at
younger age groups, mainly school students between the ages of 4–14. Edita's target market was affluent,
outgoing people, who spent a lot of time outside their homes and needed a filling, tasty snack to grab on the
go.

Jordan as a Potential Market for Edita

Building on its success in the Egyptian as well as the African market, Edita was considering a new opportunity
for expansion in Jordan. The main reason for choosing Jordan was its proximity to Egypt to guarantee the
freshness of Edita's products, as well as the similarity between the Jordanian and the Egyptian market that
would help Edita to understand its new customers' needs and preferences.

Macroeconomic Environment in Jordan

In 1999, Jordan's economy was considered among the smallest in the Middle East. Due to its limited supply
of water, natural resources, high inflation, and poverty rate, Jordan had been facing many challenges. Since
1999, King Abdallah had implemented many economic reforms to attract foreign investment and improve the
country's economic position. Between 2011 and 2012, the natural gas pipelines in Egypt, which were deliv-
ering gas to Jordan, were attacked, forcing Jordan to import more expensive diesel from Saudi Arabia. In
2013, the country's GDP growth reached 3.3 percent as compared to 2.8 percent in 2012. The GDP per capi-
ta reached $6,100. Table 1 outlines key demographic and economic indicators in Jordan.

Table 1: Demographic and Economic Indicators for Jordan.

Demographic Factors
Jordan
(2014)

Population 7,930,491

Population growth
3.86%
rate (%)

Median age 21.8 years

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Age structure:
• 35.8%
• 0–14 years
• 20.4%
• 15–24 years
• 35.7%
• 25–54 years
• 4.2%
• 55–64 years
• 5.1%
• 65 years and
over

Urban : rural compo-

82.7% urban : 17.3% rural
sition

Life expectancy 74.1 years

Below poverty line

14.2% (2002)
(%)

Total fertility rate 3.16 births per female

Infant mortality rate 15.73 deaths per 1000 births

Number of adults liv-

600 (2007)
ing with HIV/AIDS

Ethnic groups Arab (98%); Circassian (1%); Armenian (1%)

Religions Sunni Muslim (97.2%); Christian (2.2%); other (2%)

Languages Arabic (official), English commonly used as a second language

Literacy: • 95.9%
• 97.7%
• Overall • 93.9%

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• Male
• Female

Economic Factors
Jordan
(2013)

GDP ($) (purchasing

$40.02 billion
power parity)

GDP (%) (real growth

3.3%
rate)

GDP – per capita

$6,100
(PPP)

Labor force 1.898 million

Unemployment rate 14%

Value of imports $18.61 billion

Value of exports $7.914 billion

External debt $22.04 billion

Inflation rate (con-

5.9%
sumer prices)

clothing, fertilizers, potash, phosphate mining, pharmaceuticals, petroleum refining,

Major industries
cement, inorganic chemicals, light manufacturing, tourism

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Major trading part-

Iraq, Saudi Arabia, India, China, US, Italy, Pakistan, Indonesia, and Turkey
ners

Source: CIA World Factbook, https://www.cia.gov/library/publications/the-world-factbook/geos/jo.html.

Food and Beverage Industry in Jordan

Over the past few years, the food industry in Jordan had been changing and developing. Several different
variables led to this change. First was the emergence of the young population with their fast-paced lifestyle
and preference for Western food. The increase in the number of working women reduced the time available
for preparing meals at home. In response to these changes, the demand for cold cuts and snacks in school or
at work has increased. The spread of small restaurants around schools, universities, and company clusters
had also increased the demand for ready-made food and snacks. Finally, the wide variety of choices in the
food segments encouraged people to consume these products more than before.

The market for premium food in Jordan was still emerging. The country's imports in this category were second
after grains and oilseeds. The Jordanian market was considered an attractive market as it also provided ac-
cess to the Iraqi market through Jordanian companies that exported to Iraq or through Iraqi companies based
in Jordan. Jordan imports processed food products from different countries, such as Bulgaria, Turkey, China,
Switzerland, Canada, and other Middle Eastern countries.

Jordan's Main Competitors

Al Nabil Company for Food Products was one of the leading companies in the F&B industry in Jordan. The
company started in 1954 and specializes in a wide range of products such as frozen beef, chicken, fish, and
desserts. The company employed more than 650 people with good experience who follow strict standards of
production. The Al Nabil Company distributed its products both locally and internationally to hotels, restau-
rants, schools, hospitals, the airline sector, and retailers.

Another leading company in the F&B sector in Jordan is Alfayoumi Fruits, Vegetables, Foodstuffs Trading
Establishment. The company sold its products to different countries such as North America, South America,
western Europe, eastern Europe, eastern Asia, and other regions around the world.

South Africa as a Potential Market for Edita

The second market that was considered by Edita for expansion was South Africa. The strong trade agree-
ments between Egypt and South Africa encouraged Edita to consider expanding to this market. Their common
membership in the COMESA (common market for Eastern and Southern Africa) eliminated trade barriers
between the two countries, reduced tariffs, and facilitated trade. Moreover, Edita's success in Tanzania and
Kenya allowed the company to have a better understanding of the African market.

Macroeconomic Environment in South Africa

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South Africa was considered an emerging market with a large supply of natural resources. The country's well-
established infrastructure allowed for efficient distribution of goods and services. However, its unstable elec-
tricity supply had hindered the country's growth. South Africa also has faced many challenges including un-
employment, poverty, and inequality. The unemployment rate reached 24.9 percent in 2013. The GDP growth
rate decreased from 3.5 percent in 2011 to 2 percent in 2013. The GDP per capita reached $11,500 in 2013.
Economists forecast that growth wouldn't exceed 3 percent until newly built power stations come online. Table
2 outlines key demographic and economic indicators in South Africa.

Table 2. Demographic and Economic Indicators for South Africa.

Demographic
South Africa
Factors (2014)

Population 48,375,645

Population
−0.48%
growth rate (%)

Median age 25.7 years

Age structure:

• 0–14
years
• 15–24
• 28.3%
years
• 20.2%
• 25–54
• 38.2%
years
• 7.1%
• 55–64
• 6.1%
years
• 65
years
and
over

Urban : rural
62% : 38%
composition

Life expectancy 49.56 years

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Below poverty
31.3% (2009)
line (%)

Total fertility rate 2.23 births per female

Infant mortality
41.61 deaths per 1000 births
rate

Number of
adults living with 6 million
HIV/AIDS

Ethnic groups Black Africans (79%); white (8.9%); colored (8.9%); Indian/Asian (2.5%)

Religions Protestant (36.6%); Catholic (7.1%); Muslim (1.5%); other Christian (36%)

IsiZulu (22.7%); IsiXhosa (16%); Afrikaans (13.5%); Sepedi (9.1%); English (9.6%);
Languages
Setswana (8%); Sesotho (7.6%); Xitsonga (4.5%); other (1.6%)

Literacy:
• 93%
• Overall • 93.9%
• Male • 92.2%
• Female

Demographic
South Africa
Factors (2013)

GDP ($) (pur-

chasing power $595.7 billion
parity)

GDP (%) (real 2%

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growth rate)

GDP – per capi-

$11,500
ta (PPP)

Labor force 18.54 million

Unemployment
24.9%
rate

Value of imports $99.55 billion

Value of exports $91.05 billion

External debt $139 billion

Inflation rate
(consumer 5.8%
prices)

mining (world's largest producer of platinum, gold, chromium), automobile assembly,

Major industries metalworking, machinery, textiles, iron and steel, chemicals, fertilizer, foodstuffs, com-
mercial ship repair

Major trading
China, United States, Germany, Japan, the UK, India, and Saudi Arabia
partners

Source: CIA World Factbook, https://www.cia.gov/library/publications/the-world-factbook/geos/jo.html.

Food and Beverage Industry in South Africa

South Africa was considered a food self-sufficient country because all products to satisfy the population's food
needs are produced locally. The country also had a well-developed F&B industry that made it both an attrac-

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tive market internally and a player in the global F&B industry. The food-processing sector was considered the
largest category of the South African manufacturing industry. Most food-processing companies in South Africa
partner with international companies that provide them with new technology and expertise, while these inter-
national companies were granted access to the attractive South African market. These international players
included Cadbury, Schweppes, Coca Cola, Danone, H. J. Heinz, Kellog, McCain Foods, Minute Maid, Nestlé,
Parmalat, Pillsbury, Unilever, and Virgin Cola.

The F&B sector was considered one of the most important components of South Africa's manufacturing sec-
tor. The beverages accounted for 4 percent of manufacturing sales, while food accounts for 13 percent. In
2009, the F&B sector increased the gross value added in the manufacturing sector by 17 percent and em-
ployed 230,000 people. The food processing segment accounted for one-quarter of the 37 percent of na-
tional GDP generated by agricultural industries. Moreover, 60 percent of South Africa's processed potatoes,
435,000 tons per year, were made into chips. South Africa also has 650 commercial potato farms.

South Africa's Main Competitors

Many F&B brands were owned and controlled by three big companies that experienced a 10 percent increase
in turnover in 2012: Tiger Brands, Pioneer Foods, and AVI.

Tiger Brands was the leading company in the F&B industry in South Africa. The company manufactured in
South Africa, Nigeria, Kenya, as well as other countries. Tiger Brands firm distributed its products to more
than 66 countries around the world. The company manufactured a variety of products such as baby care
items, beverages, grains, grocery staples, and snacks and treats. The company produced various brands in
the snacks and treats section, including All Sorts, Anytime, Black Cat, Jelly Tots, and so on. The company's
mission was to “be a highly performing, fast-moving consumer goods company with leading brands, operat-
ing across the globe in several selected emerging territories” (Tiger Brands website). In 2012, Tiger Brands'
turnover reached $2 billion, as compared to $1.8 billion in 2011. In 2012, the company purchased Dangote
Flour Mills in Nigeria for $200 million as well as South Africa's favorite brand, Mrs. Ball's Chutney, for $43
million.

Pioneer Foods was one of the largest producers and distributors of food and beverages in South Africa. The
company aimed at providing food products at affordable prices while complying with high safety and quali-
ty standards. The company produced a number of different products, such as cereals, dried fruit products,
baking ingredients, rusks, juices, and eggs. The company owned many famous brands such as Bokomo
Maltabella, Nulaid eggs, Ceres and Liqui-fruit juice, Heinz ketchup, Safari dried fruits, and Moir's cake mix.
Pioneer Foods was divided into three main sections: essential foods (which includes wheat, rice, and dried
vegetables), groceries (which includes cereals, biscuits, cake mixes, mashed potatoes, dried food products,
etc.), and Pioneer Foods International. Pioneer Foods International included a joint venture with Heinz food,
through which Pioneer Foods manufactures tomato sauces and ketchup, frozen foods, seafood-tinned prod-
ucts, tinned food, instant meals, and noodles. In 2012, Pioneer Foods had a turnover of $1.7 billion.

AVI produced a wide variety of products such as hot and cold beverages, sweet and savory snacks, fresh and
convenience foods, cosmetics, shoes, and accessories. The company had more than 33 owned brands and
more than 20 brands under licensing agreements. Some of these brands included Five Roses in the bever-
age section, Willards Chips, and Bakers and Pyotts biscuits. The F&B division accounted for 75 percent of
the company's revenues.

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Assessing Export/Import Opportunities

Any company that follows internationalization strategy should continuously scan the environment with the
purpose of identifying and acting upon additional business opportunities through which it can leverage both
its knowledge of its industry (food products) and its new location. However, not all opportunities a company
may identify are equally advantageous and profitable. Therefore, managers should learn how to evaluate and
discriminate among opportunities. Import/Export operations are considered to be the simplest complemen-
tary activities for an international company. Additional income from such complementary activities could help
recover the investment Edita will be making in a new country. In the two following sections, four different op-
portunities available to Edita in two countries are presented for evaluation.

Possible Import Opportunity

There were different products that Edita could import to Jordan and South Africa, in addition to its main line
of business. For Jordan, Edita may consider importing processed beef from Faragalla (Egypt). Faragalla was
an Egyptian company established in 1973 and produced a wide range of products like frozen vegetables,
juice products, milk products, bakery products, processed meat, processed cheese, powder products, canned
products, and tomato products. Faragalla produced high quality products and was awarded the ISO 9001
quality management certificate.

Edita would consider importing beef in particular because, unlike chicken, beef was not abundant locally in
Jordan. Food represents 14% of Jordan's imports and accordingly importing processed beef would be rela-
tively simple. Although Edita Foods would be competing with other importers, the company would face mini-
mal competition in the local market due to the small number of competitors in the processed meat sector.

Although the Jordanian government imposed tariffs on products in the F&B industry that could reach 180%,
free trade agreements were forcing Jordan to limit the tariff barriers to 20% maximum for products other than
alcohol and tobacco. Accordingly, the imported beef would undergo a maximum of 20% import tax only. How-
ever, the Jordanian government may only require a license as it required an import license on some food
stuffs.

For South Africa, Edita may consider importing Halal and Kosher bottled baby food from Gerber. Halal prod-
ucts use ingredients that comply with the Islamic religion and accordingly are highly demanded by Muslims.
The increasing number of Muslim residents in South Africa, around 700,000 Muslims, would increase demand
for Halal food. Moreover, importing an organic baby product would also be appealing to health conscious cus-
tomers. As for the brand name, Gerber was a major player in the worldwide baby food market, exporting to
over 80 countries more than 190 products. It owned over 83% of the baby food market share in the United
States and was sold to Nestlé company in 2007.

Regarding the government's regulations, South Africa was in the process of decreasing its tariff and non-tariff
barriers to entry. This was mainly due to the fact that South Africa was a member of the World Trade Organi-
zation and has been a supporter of the General Agreement on Tariffs and Trade.

Possible Export Opportunities

There were also different export opportunities that Edita was considering. The popular Nabulsi cheese of Jor-
dan was a very good food product to export. Nabulsi cheese was a kind of brined white cheese. This cheese
was made from goat or sheep's milk, but could also be made from cow's milk. Nabulsi cheese was fresh, non-
processed and calcium-full cheese which was highly demanded, especially by health conscience customers.
Moreover, the Nabulsi cheese could be used in making pastries, tarts, sandwiches, wraps, desserts, etc. On

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the other hand, the Nabulsi cheese was considered new to the other markets and customers could be resis-
tant to try it.

Wafeer was the market leader in Jordan for the production of food products. The company produces a wide
variety of food products and is known for its Nabulsi cheese. Wafeer exported its products to Saudi Arabia and
was able to develop packaging and transportation methods to preserve its dairy products. The opportunity
of exporting Wafeer's Nabulsi cheese would be successful especially after the current negotiation with multi-
national companies to supply their foods in the foreign markets under their names and packaging. Currently,
Wafeer was supplying McDonald's and Burger King with many food products that they use in their sandwich-
es.

For South Africa, Edita was considering Sally Williams nougat as a product to export. The luxury confectionary
product was demanded around the world and in the US and Canada in particular. It was also considered the
finest nougat in the world. All Sally Williams products were with no added cholesterol, no preservatives and
were free from gelatin or gluten. Besides the indulgence in the sweetness and lavishness of the nougat, there
were many recipes for desserts that could be made using Sally Williams nougat which made it a good product
for exporting to the most exquisite restaurants, confectioners and individuals in the world.

What made this a really good export opportunity was the fact that Sally Williams used ingredients from around
the world to produce its well renowned nougat; from Morocco and Tunisia to France and Italy. The company
was currently exporting to some countries but it could consider expanding its exports further.

Growth Opportunities for Edita

For Edita Foods, there was a high need for growth. Because its production facilities had excess capacity and
because it already exported 15 percent of its production, Edita Foods had a lot of potential to grow and could
possibly expand in two countries: Jordan and South Africa. Each of them had its own unique set of character-
istics that made it a good option to pursue on its own.

However, some questions needed to be considered in the analysis of both countries. For instance, what fac-
tors should be kept in mind while choosing possible new countries for expansion: demographics, government,
economics, and/or physical and communications infrastructure. Looking at the food industry in Egypt, what
are some possible products that Edita Foods can export to Jordan and South Africa? What are some export
opportunities, related to Edita Foods' industry to Jordan, South Africa, and the world market? How can the
attractiveness of these import and export opportunities be rated? What are the possible modes of entry (ex-
porting, joint ventures, licensing, or foreign direct investment) Edita Foods should consider when expanding
internationally? Out of the possible entry modes, which one is the most suitable? What is the target market of
Edita Foods in the two countries of Jordan and South Africa? Who are their local and international competi-
tors? What is the target market estimate in dollars? What may be the forecast sales for each country?

Discussion Questions
1. What factors should Edita Foods consider when choosing possible new countries for ex-
pansion (demographics, government, economics, and physical and communications in-
frastructure)?
2. Rank the import and export opportunities in terms of their attractiveness, and explain the
rankings.
3. Identify the possible modes of entry (exporting, joint ventures, licensing, or foreign direct
Edita Foods: Prospects for International Expansion to Jordan and South
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SAGE SAGE Business Cases
© Marina Apaydin and Hend Mostafa 2016

investment) that Edita Foods should consider when expanding internationally. Out of the
possible entry modes, which one is the most suitable?
4. What is the target market for Edita Foods in the two countries of Jordan and South Africa?
Who are their local and international competitors? Estimate the target market in dollars.
5. Prepare a financial forecast for future Edita sales in each country.

Further Reading
Alfayoumi Fruits, Vegetable, Foods. Trade Bank. (n.d.). Retrieved from http://www.tradebanq.com/company/
1684807/Alfayoumi-Fruits-Vegetable-Foodstuffs-Trading-Est-.html
Agriculture and Agri-food Canada. (2010). Government of Canada. Retrieved from http://www.ats-
sea.agr.gc.ca/afr/4002-eng.htm
AVI. (n.d.). Retrieved from http://www.avi.co.za/our_company
Mostafa, H. (2006). Kneading exports. Business Today. Retrieved from http://www.businesstodayegypt.com/
article.aspx?ArticleID=6641
Nabil Food. (n.d.). Retrieved from http://www.nabilfood.com/en/about-nabil/history
Pioneer Foods. (n.d.). Retrieved from http://www.pioneerfoods.co.za/who-we-are/business-profile/
Siniora Food Industries: Food & beverages. (n.d.). Oxford Business Group. Retrieved from http://www.oxford-
businessgroup.com/analysis/siniora-food-industries-food-beverages
Tiger Brands. (2013). Retrieved from http://www.tigerbrands.co.za/
Young, John. (n.d.). Expanding the food and beverage sectors in South Africa. Frontier Market Network. Re-
trieved from http://www.frontiermarketnetwork.com/article/2361-expanding-the-food-and-beverage-sectors-
in-south-africa#.VHWd2IuUdbE

Links to Other Web Resources

Food and Beverages Industry. (n.d.). http://www.thaiembassy.org/pretoria/contents/images/text_editor/files/
BIC-South%20Africa-F%20Industry.pdf
Industrial Modernisation Center. (2005). Egyptian Processed Food Sector Review. http://www.imc-egypt.org/
index.php/en/studies/finish/59-executive-summery/8-egyptian-processed-food-sector-development-strategy

Bibliography
Agriculture and Agri-food Canada. (2010). Government of Canada. Retrieved from http://www.ats-
sea.agr.gc.ca/afr/4002-eng.htm
AVI. (n.d.). Retrieved from http://www.avi.co.za/our_company
CIA. (2009). Egypt. The World Factbook. Retrieved from www.cia.gov
CIA. (2009). Jordan. The World Factbook. Retrieved from www.cia.gov
CIA. (2009). South Africa. The World Factbook. Retrieved from www.cia.gov
Edita Food Industry. (n.d.). Retrieved from www.edita.com.eg
Industrial Modernisation Centre. (2005). Egyptian Processed Food Sector Review. Retrieved from Industrial
Modernisation Center. (2005). Egyptian Processed Food Sector Review. http://www.imc-egypt.org/index.php/
en/studies/finish/59-executive-summery/8-egyptian-processed-food-sector-development-strategy
Food and Beverages Industry. (n.d.). Retrieved from http://www.thaiembassy.org/pretoria/contents/images/
text_editor/files/BIC-South%20Africa-F%20Industry.pdf
Mostafa, H. (2006). Kneading Exports. Business Today. Retrieved from http://www.businesstodayegypt.com/
article.aspx?ArticleID=6641
Pioneer Foods. (n.d.). Retrieved from http://www.pioneerfoods.co.za/who-we-are/business-profile/
Rymer, E. (2008). “Food Processing in Ancient Egypt”.
Siniora Food Industries: Food & Beverages. (n.d.). Oxford Business Group. Retrieved from http://www.oxford-
businessgroup.com/analysis/siniora-food-industries-food-beverages
Edita Foods: Prospects for International Expansion to Jordan and South
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SAGE SAGE Business Cases
© Marina Apaydin and Hend Mostafa 2016

Tiger Brands. (n.d.). Retrieved from http://www.tigerbrands.co.za/

Young, J. (2013). Expanding the food and beverage sectors in South Africa. Frontier Market Network. Re-
trieved from http://www.frontiermarketnetwork.com/article/2361-expanding-the-food-and-beverage-sectors-
in-south-africa#.VHWd2IuUdbE
http://dx.doi.org/10.4135/9781473974555

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