PROGRAMME:

EXECUTIVE MASTER IN
OPERATION & PROJECT
MANAGEMENT

MODULE:
INTERNATIONAL BUSINESS

HAMBRA EDU SERVICES

F-16-2, Alam Avenue 2, Jalan Serai Wangi N16/N,
Seksyen 16, 40000 Shah Alam.
www.executivetraining.com.my

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 ASSIGNMENT COVER
HAMBRA EDU SERVICES

STUDENT’S NAME : RUTHIREN A/L RAMASAMY

I/C NO / MATRIX NO. : HMPM21155

PROGRAMME : EXECUTIVE MASTER IN OPERATION &

PROJECT MANAGEMENT

CLASS DATE : 19 FEBRUARY 2022

INTAKE DATE : 2021

MODULE : INTERNATIONAL BUSINESS

TRAINER’S NAME : DR.ZAMRI BIN ISA

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TABLE OF CONTENT

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 NO SUB TOPICS PAGE
NO NO

1.0 INTRODUCTION
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2.0 OVERVIEW OF SELECTED COUNTRY - MONGOLIA' 6

3.0 MACRO ENVIRONMENTAL ANALYSIS 7

3.1 Cultural and Societal 7

3.2 Political and Legal Analysis 7

3.3 Economic and Trade Analysis 8

3.4 Competitors and Technological Analysis 8

3.5 Financial Analysis 9

4.0 BUSINESS OPPORTUNITES AND RISKS ANALYSIS 11

4.1 Identification of business potential 11

4.2 Increasing Demand for Organic Food in Mongolia 12

4.3 Identification of business risk in Mongolia 13

5.0 IMPLEMENTATION 14

5.1 Strategy 14

5.2 Structure 15

5.3 Operation 16

6.0 OBJECTIVES STRATEGIES AND PROGRAMS 17

6.1 Brand Positioning 17

6.2 Market Segmentation 17

6.3 Marketing Objectives 18
6.4 Promotional Tools 19
6.5 Pricing Strategy 20

6.6 Contingency Plans 20

7.0 CONTROL AND EVALUATION 22

8.0 CONCLUSION 23

9.0 REFERANCE4 24

TABLE 1 SOWT Analysis 10

1.0 INTRODUCTION

Zenxin Agri Organic Food Sdn. Bhd (Zenxin) is an organic fresh producer in
Malaysia. It was established in 2001 and specialized in organic farming. Its organic
farm, packing facilities and food processing plant have been certified by NASAA in
2008. Zenxin extended its food business to agro-tourism business by converting its
biggest organic farm, which is located in Kluang, Johor, into Zenxin Organic Park in
2009 and established its sister brand “Simply Natural” which offers organic cooking
ingredients in 2010. It further extended its business in 2015 by setting up Zenxin
Travel which operates experiential nature tours. In order to meet the increasing
demand, Zenxin expanded its food-processing operations in 2016 by offering
organic handmade noodles and organic tea. The processing facilities are approved
by JAKIM and about 30 products of Simple Nature are certified Halal. In the same
year, Zenxin also began providing home delivery services, Organic Express, in
Malaysia and Singapore. Currently, Zenxin has 14 retail outlets around Malaysia
and Singapore and its products are also distributed in more than 150 supermarkets in
both countries. In order to capture the growing organic trend, Zenxin has to expand
its business across more countries. This report intends to study on the macro
environment of Mongolia, analyse the business opportunities and risks of Mongolia
and make suggestions on the way Zenxin can set up its presence in Mongolia.

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2.0 OVERVIEW OF SELECTED COUNTRY - MONGOLIA

The country that we have chosen is Mongolia. There are some aspects to
consider when choosing Mongolia as a new location to set up the presence of Zen
Xin which will be discussed further in this assignment. Mongolia, officially the
Socialist Republic of Mongolia, lies on the eastern part of the Indochina peninsula,
which China borders it to the north, Laos and Cambodia to the west, the Eastern Sea
to the east and the Pacific Ocean to the east and south (Mongolia Government
Portal, n.d.). Ever since the CPV initiated Doi Moi policy in 1986, with a series of
economic and political reforms, Mongolia is now successfully transformed from one
of the world’s poorest nations into a lower middle-income country. Apart from that,
the poverty rate in Mongolia has a 2 significant shrink throughout the years.
According to The World Bank (2019), Purchasing Power Parity is US$ 3.2/day, and
GDP per capita has increased by 2.5 times in 2018. According to Ministry of
Foreign Affairs (2013),
Mongolia has established diplomatic relations with 178 countries including
countries in Asia, Europe, Pacific, America and Africa to promote foreign policy of
openness, diversification and multilateralization of international relations. Besides,
at present, Mongolia is involved in 63 International Organizations and over 650
NGOs worldwide (Ministry of Foreign Affairs, 2018). The World Bank (2019)
stated the population in Mongolia has reached 97 million in 2018 with rapid
demographic change and is expected to further expand. In terms of education in
Mongolia, the citizens are given the opportunity to enjoy basic education and
equitably achieving outstanding results. Moreover, the health concerns in Mongolia
have also improved over the years with rising living standards. In brief, Mongolia
could be a potential market for Zen Xin to explore its business opportunities
according to the growth of the country.

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3.0 MACRO ENVIRONMENTAL ANALYSIS

3.1 Cultural and Societal

Cultural and Societal Analysis Mongolian cuisine is widespread across the
world ranging from spicy and sour to sweet. Sen Nag (2018) stated that in
Mongolian cuisine, minimal oil is used and has great reliance on vegetables and
herbs. Thus, Mongoliandishes provides a fine taste and relatively healthier with less
consumption of cooking oil in the food. With the continuous effort of Mongolia
Organic Agriculture Association (VOAA) in promoting organic food to the public
and government policy improvement regulated on organic product, Mongolian today
have better understanding on the benefit of consuming organic certified food and
eventually encourage the people more willing to spend on it.
According to Asia Plus Inc. (2018), organic food gains high interest among
high income people from 25 to 39 years old and those who have children due to the
healthy consumption habit. As mentioned in Jun & Xuan (2018), organic food is
gaining popularity among the locals during the past few years as there have been
more shops selling organic food in major cities such as Darhan and Erdenet.
According to Dat Nguyen (2019), the domestic consumption of organic products
worth approximately $21.5 million in as Darhan and $17.2 million in Erdene a year.
Moreover, living standard and purchasing power of 3 Mongolian increase along with
the fast-growing economy in Mongolia, the Mongolian are more capable to afford
better quality of food, for instance, organic food. Hence, with the accepting and
welcoming attitude of Mongolian towards organic food, it is a favor for Zen Xin
entering into Mongolia’s market to satisfy the demand of local.

3.2 Political and Legal Analysis

Furthermore, aiming to turn Mongolia into an attractive investment
destination, CPV put in effort, with the implementation of policy, to create a legal
framework by developing the rule of law, especially for business and foreign
investment. Mongolia’s political stability supports policy continuity (Oxford
Business Group, n.d.).According to Mah (2018), Mongolia updated its food safety
law in February 2018 (Decree 15/2018/ND-CP) with the intention to lessen the
regulatory burden and barriers and increase the channels of international trade of
food products.With a stable political and legal system and easier entrance into

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Mongolia’s international trade, Zen Xin can better expand its portfolio in Mongolia.
Other than that, Decree 109/2018/ND-CP was issued on organic farming regulations
including the procedures of certifying organic agriculture products, labels and logos,
and supporting policies, and specify the standards on organic agriculture. The
government will fund all the cost incurred in certifying the organic product and cost
of verifying arable land for organic production, and provide the agricultural
promotion assistance in organic production training to the organic farmers which
allows the organic farmer to enjoy the benefit meanwhile comply the productions
with international standards (Quynh Nga, 2018). Therefore, Mongolia’s policy on
organic agriculture benefited Zen Xin to expand its business in Mongolia and earn
market shares in the industry.

3.3 Economic and Trade Analysis

Mongolia is one of the fastest-growing economies in the Asia-Pacific region
in the medium term. According to the Trading Economics (n.d.), the GDP growth
rate in Mongolia averaged 6.28 percent from 2000 until 2018 and the GDP of
Mongolia was worth 244.95 billion US dollars in 2018 and it represents 0.40 percent
of the world economy.The economic growth of Mongolia is reflecting by the growth
of GDP and it had provide good environment to Zen Xin to expand business.
Mongolia economic development depends much on agriculture as it is one of
important Mongolia economic sectors. According to Hays (n.d.), there are
approximately 80 percent of the population lived off farming. Currently, Mongolia
economic development in rural areas is changing significantly and agricultural
operation is major part of rural economy.In year 2018, Mongolia’s total import and
export turnover reached over US$ 480 billion and trade surplus reached nearly US$
6.8 billion which is three times higher than 2017 (Nhan Dan, 2019).Extensive
market-oriented and outward-looking economic policies have helped Mongolia
achieve sustained and inclusive economic growth. This also makes Zen Xin easier to
enter the market as Mongolia keeps an open attitude to international trade.

3.4 Competitors and Technological Analysis

Due to the raising awareness of healthy lifestyle, the trend of organic food
consumption is more favorable to establish and develop in Mongolia. According to
Mongolia News (2018), local consumers spend around US$27 billion on fresh foods

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annually. However, the local farmers could not supply sufficient amount of organic
even though there are higher demands from local markets due to the total farming
area and retail networks for organic produce are still modest. The supply of organic
produce is also unstable and prices also fluctuate due to limited organic farming.
One of the reasons is local small farmers are facing difficulties to getting loans from
bank to expand their production area because the bank requirement is too hard to
satisfy even though government had provide favorable conditions for developing
organic and high-tech farming .It is beneficial to Zen Xin to expand business to
Mongolia as the organic food produced in Mongolia cannot meet the demand of
local. Along with the growing demand of organic food, the organic food market
becomes the target market for foreign businesses to embark and some well-known
foreign businesses have joined the market, including Bellamy. Bellamy's Organic
products is trusted by local consumers because its products are manufactured in
Australia which has a strict requirements for food safety. In addition, Bellamy's
Organic products are certified organic by the National Association for Sustainable
Agriculture of Australia (NASAA) which is the leading provider of organization and
supply chain standards for organic farming in Australia.Therefore, it is a challenge
for Zen Xin as a new entrant of this market and Zen Xin need to consider more on
the development of marketing strategy to win customers from different types of
competitors.

3.5 Financial Analysis

According to IMF News (2019), Mongolia has managed to halt the increase
in public debt and create some fiscal space in recent years. The government
consistently reduced the dependence on foreign loans as a key move to lead
Mongolia becomes a middle-income country. Mongolia’s public debt hit the lowest
since 2015 at 58.4% of the GDP as of the end of 2018.The more favorable fiscal
position provides the authorities with the means to step in should downside risks
materialize (IMF News,2019). Conversely, if growth is beyond expectation, existing
debt could be paid down at a faster pace and provide more stable economic
environment. Hence, Mongolia had provide more financially stable environment to
Zen Xin to expand the business.However, Mongolian government may reduce the
public debt through raising of taxes and this lead to the increase of cost of business
and reduce the profit of Zen Xin. Other than that, the pressure on domestic interest

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 rates has eased as central banks in many countries are no longer pursuing tight
monetary policies. State Bank of Mongolia decided to cut several key interest rates
by 0.25 percentage points from 16 Sep 2019 would help credit institutions access
more affordable capital from the Bank of Mongolia. As the result, it is much more
beneficial for Zen Xin to get loans to invest in the expansion of business.

SWOT Strengths Weaknesses

1. Strong corporate 1. Not advertise extensively
orange color image in in Malaysia
consumers’ mind
2. Strong support from 2. Outdated website and
parent brand social network
3. Commitment to 3. Inconsistent service and
providing healthy menu food quality
items
Opportunities SO Strategies WO Strategies
1.Growing health trends S1O1: Penetrate into W1O1: Introduce healthy
among consumers healthy menu choices lunch meal to target
consumers
2. Growth of organic S2O2: Combination of
food ingredients amino collagen with high
antioxidants and food
3. Technological S3O3: Innovations such W2O3: High visibility in
advances for ordering food as apps and online Facebook and Twitter and
ordering systems for ease create a website for online
of acquiring food ordering
4. Diversification of food S4O4: Shifts towards W3O4: The company is
concepts natural and beauty inexperienced in different
concept food
concepts and would need to
develop a sound plan before
starting a new concept
Opportunities SO Strategies WO Strategies

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 1.Perspective on “Rising S1T1: Increase W1T1: Expanding operations
food prices” due to GST awareness of GST and promotions creates the
implementation need for more sales
2.Ease of entry into the W2T2: Intensive research
market and development (R&D) and
market research
3.Impact of economic
Downturn from
recovering
economy
4. Change in consumer S1T4: Maintain customer
tastes and preferences loyalty would increase
sales

Table 1.0: SOWT Analysis

4.0 BUSINESS OPPORTUNITES AND RISKS ANALYSIS

4. 1 Identification of business potential

Identification of business potential in Mongolia (i) Strong Economic Growth
in Mongolia According to one of the articles in The World Bank website, it was
said that Mongolia has facing rapid economic growth in past 30 years, transforming
from world’s poorest nations into a lower middle-income country. It was stated that
between 2002 and 2018, the poverty rates were declined sharply from 70% to below
6% now, and GDP per capita increased by 2.5 times in the year of 2018. Overall, it
was said that Mongolia’s economic outlook is positive in the medium-term (The
World Bank, 2019). 6 As a result, it is predicted that the consumer income will
increase, leading to higher living standards and greater purchasing powers.
Therefore, the demand for higher quality products will be increased, indicating a
business opportunity for Zen Xin in reaching a larger potential market for their
organic products in Mongolia .

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4.2 Increasing Demand for Organic Food in Mongolia
According to an article from Organicity website, it was stated that the FIBL
2018 Report shows that in 2017, the market for organic agricultural products in
Mongolia indicated a stable increase, supported by increased consumption and
government policy (Organicity, 2019). In addition, one of the articles from the Xin
Hua Net mentioned that Mongolia are opting for organic products due to being
more health-conscious, environmentally-conscious, and socially conscious, leading
to boom of shops specialized in organic items. The article also mentioned that based
on a survey regarding to customers' behaviors conducted in 2015 by a company,
Nielsen, Mongolia shoppers are deeply concerned about the food's origin. In
particular, 77 percent of the respondents said that fresh, natural and organic
ingredients have either a "very heavy" or "heavy" influence on their purchasing
decisions (Xuan, 2018). These survey results can be supported by another statistic
result done by Ella Zoe Doan. These survey results strongly indicating that there is
a business opportunity in Mongolia for the company.

i. Government inMongolia Supports for Agricultural Development and Food Safety

According to one of the articles in Mongolia News website, it was said that the
Ministry of Agriculture and Rural Development plans to promote activities
aiming at a sustainable and comprehensive agricultural value chain. In order to do
so, the ministry is actively engaging participants from private sector under
Public-Private Partnership (PPP) model to set up information system and
encourage dialogues among foreign businesses, domestic firms, and agricultural
associations (Mongolia News, 2017). Furthermore, the ministry also said that
Mongolia hopes to create connectivity between foreign and domestic firms so
that they are able to share information and experiences in 7 business efficiency
and green that agriculture development (Mongolia News, 2017). This
information shows that the government is encouraging agricultural development
in the country, create an opportunity for Zen Xin to emerge in the Mongolia
market. Moreover, Mongolia also takes proactive steps in an attempt to enhance
the food labelling system for locally produced organic products. The Ministry of
Science and Technology has officially issued a framework to regulate organic
agricultural products (Fresh Plaza, 2018). Since there are frameworks in
regulating the organic products, it means that the market for organic products in

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 Mongolia is big and can gives Zen Xin a business opportunity to expand in the
Mongolia market.

4.3 Identification of business risk in Mongolia

i. Unpredictable climate change Based on a report that published by the Food and
Agriculture Organization of the United Nations (FAO), the natural disasters
which between 2005 and 2015 cost the agricultural industries of developing
country economies a stunning $96 billion in damaged or lost crop and livestock
production. Mongolia is among the five countries likely to be worst-affected by
climate change (GFDRR, 2011). Since the climate of Mongolia central land is
relatively harsh, which mainly influenced by the heavy rainfall, storms and hot
dry southwest wind, sometimes in the rainy season will come with storms and
tropical cyclones characterized by heavy rainfall and strong winds. Therefore this
indicated that there is a possible chance that an unexpected undulation in the
climate of Mongolia . Thus there will be some unpredictable natural disaster
occurs which bring undesirable impact toward the lowland of central Mongolia .
When the climate of Mongolia change, there will be an increase in the strengths
and frequencies of extreme weather and disasters, and the sea level will rise, land
erosions and slides. The farmers will suffer some lost in crop and received a poor
yield due to the natural disaster either to floods arriving inexpertly or to the
inadequate flood control structures. Besides that, based on a research in 2017, it
was said that the natural disasters caused heavy losses toward the agriculture
industry in Mongolia which lead to a negative growth rate of 0.18% in the first
six months of the year 2016 (Long, 2017). In such, Zen Xin must possess some
precaution to confront and solve the climate risk which to avoid the undesirable
lost in profit if tend to expand the business in Mongolia .

ii. Lack of of skilled labor - According to the national survey in 2016, the average
age of a labor in agriculture sector has rose up by 38.54% to 40.16% from 2011
to 2016. In 2016, there were a sum of 31.02 million people of working age in
Mongolia ; however 65.9% of them are inexperienced. By the way, there was
18.3% of workers have accepted short-term training, and only 15.9% (accounting
for 4.91 million people) have either tertiary education or vocational education.
Only 4% have a college or university education (GSO, 2018b). As a result, the

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 agriculture industry in Mongolia may encounter the circumstances of shortage in
high skilled labor. Moreover, due to the strong economic growth in Mongolia ,
the need of additional labor keep increasing and the cost of labor also rise up
simultaneously. However, the workers that last in the agriculture sector of
Mongolia are majorly older households and unskilled people. In such, it is hard
to improve the productivity level in Mongolia agriculture due to the low level
skilled labor make the further application of modern technology difficult to apply.
Therefore, if to expand business in Mongolia , Zen Xin may incur additional
training cost and also the wastage of time in training skilled labor. Moreover,
since to cultivate high skilled labor need a plenty of time, thus there is maybe a
potential risk in low productivity in the agriculture manner when Zen Xin first
initial the business in Mongolia . As a result, Zen Xin may incur deficit profit
when running business in Mongolia initially.

5.0 IMPLEMENTATION

5. 1 Strategy
Market Entry Strategy The strategy for Zenxin to enter into Mongolia ’s
market is by exporting its organic products produced in Malaysia to Mongolia . As
compared to other ways of entering the market, exporting is an optimal strategy for
Zenxin to penetrate into Mongolia ’s market in the first stage of business expansion as
it has lower costs, lower risks, simpler and quicker process. Firstly, the cost of
exporting strategy are relatively lower because Zenxin is not required to set up
farming, processing and packaging operation in Mongolia , while it can continue
producing its organic products in Malaysia and exporting them to Mongolia upon
completion. This can provide cost savings on labor training and supervision in
Mongolia as well.
Moreover, the increase in production level in Malaysia might enable Zenxin to
gain economies of scale (“The Pros and Cons of Exporting”, n.d). In addition, the
trade barriers and international transportation costs from Malaysia to Mongolia are
relatively lower than from other countries like Japan and Australia. This can provide
competitive advantages to Zenxin because Zenxin is able to offer its organic
products at a lower price than other Mongolia ’s imported organic products.
Furthermore, exporting strategy can reduce the exposure of business risks mentioned

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 in to Zenxin, which is the risk of unstable climate change and lack of skilled labor
in Mongolia. The process of exporting from Malaysia to Mongolia is considered
simple since Malaysia is recognised as one of the certified countries that can export
agri-based product to Mongolia without going through a complicated process
(Mohd Zaffrie, Mohd Hafizudin and Nik Rozana, 2017).

 International Business Strategy

The international business strategy to be implemented by Zenxin’s business
in Mongolia is International Strategy which has low cost pressure and low local
responsiveness. Since the Malaysia External Trade Development Corporation
(MATRADE) stated that Malaysian food products are highly accepted by Mongolia
consumer, there is minimal customization required to be made in Zenxin’s organic
products to be sold in Mongolia (MohdZaffrie, MohdHafizudin and NikRozana,
2017). The cost pressure faced by Zenxin is also considered low due to the low
transportation costs, low trade barriers, low operation costs as mentioned in
paragraphs above.

5.2 Structure
i. Business structure The organic products exported from Malaysia to Mongolia are
to be sold in a newly set up distribution centre of Zenxin. The distribution centre
to be set up is in the form of a limited liability company which is suitable for
establishing a small or a medium-sized enterprise (SME) in Mongolia (“Legal
Entities in Vietnam: Which One to Choose?”, 2018).
ii. Organizational structure - The type of organizational structure to be implemented
in Zenxin’s business in Mongolia is decentralised structure. This kind of
organizational structure is suitable for business located 10 in different
geographical units as it can facilitate the growth and expansion of Zenxin’s
business by allowing the business entity in Mongolia can operate independently
and reacting quickly to domestic market’s needs if necessary (“The Advantages
of a Decentralized Organizational Structure”, 2019).

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 5.3 Operation
The key operations of Zenxin’s business in Mongolia include producing,
processing and packaging, exporting, warehousing and transporting and distributing.
The operation of each activity in elaborated as follows:
i. Producing, Processing and Packaging - The organic products will be continually
produced, processed and packaged in Malaysia. Since there will be increase in the
production level, Zenxin might need to increase its labours in order to have a
greater production efficiency. The supervision and inspection processes also have
to be increased to ensure the quality level. Upon completion of these processes,
the products will be delivered to the Federal ports in Malaysia.

ii. Exporting Before exporting the products, all of the export procedures and
submission the mandatory documents have to done. Zenxin will need to look for
international carriers’ services for shipping its products to Mongolia’s ports. The
organic food exported to Mongolia is subject to Mongolia Food and Agricultural
Import Regulations and Standards, thus, it is important for Zenxin to ensure its
compliance with the latest updated standards.

iii. Warehousing and transporting Zenxin can obtain services from international
logistics providers in Mongolia such as Twin Logistics Mongolia Co Ltd and
T&M Forwarding Ltd. The services provided usually include warehousing,
custom clearance, picking and transportation.

iv. Distributing - As mentioned in Part 5.2, a distribution centre will be set up to

distribute the organic products imported in Mongolia. The distribution centre will
be located in Erdenet City, Mongolia as there are high organic food consumption
and high development in commerce in this city (Sophie, 2019).

In order to reach a wider customer base,Zenxin also can distribute its products
through hypermarket and supermarket chains in Mongolia, such as Aeon and Big C
supermarkets in Mongolia. The home delivery service that is being offered in
Malaysia and Singapore can be offered in major cities such as Erdenet, Darhan City
and Ulaanbaatar as well, since Mongolia is recognized as one of the fastest-growing
online grocery markets worldwide (Simon and Sarah, 2019).

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6.0 OBJECTIVES STRATEGIES AND PROGRAMS
This will outline key objectives, target market, positioning strategy, promotional
tools and pricing strategy that will be implemented by Zenxin.

6.1 Brand Positioning

 Positioning Statement 1: Zenxin helps maintain and promote health.
Unique Selling Point 1: The increase in non-communicable chronic disease, stress in
the workplace, lack of time and other consequences of our everyday rapid pace of
life will force individuals to eat healthier food more regularly in order to reduce
negative effects of this fast-paced life of their health. If we eat a balanced diet, our
cells will be properly fed and protected, which enable them to have effective
immune systems.

 Positioning Statement 2: Zenxin is both health and tasty for consumers.

Unique Selling Point 2: We choose from among many high quality and fresh
ingredients to make up aorganic food. To ensure the original taste.

 Positioning Statement 3: Zenxin is crucial for combating aging issues.

Unique Selling Point 3: An imbalanced diet can lead to problems with old people. A
wholesome balanced diet over a long period provides better and healthier lifestyle.

6.2 Market Segmentation

In fact, base on the market analysis above, Zenxin segmentation can be summarized
by using demographic and behavioral factors.
 Age Group
 Family Size
 Occupation
 Income
 Benefits
 Loyalty Status
 Readiness Stage

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6.3 Marketing Objectives
i. The objective of this marketing plan is to recommend a business proposition
which is measurable and attainable by firstly identifying Zenxin goals. The
objective of the marketing plan is to introduce a new product by developing
marketing strategies and plan.
 Objective 1: To create brand awareness of Zenxin to the consumers.
 Goal 1: Obtain 15,000 “first-time” visitors to Zenxin outlet within six months of
implementation.
 Tactic: Implement new mobile app in webpage that allows customer to interact
with Zenxin in order to create viral marketing.
 Tactic: Offer special promotions such as vouchers and free gifts in the outlets for
customers who upload their photos with Zenxin on the spot.

ii. Implement new Zenxin a shuttle program designed for customers from a Kuala
Lumpur area to Zenxin outlet in Mongolia.This goal is meant to reach potential
customers without means or desire to travel to Zenxinoutlet. If a customer is
made aware of the product line, they may be more willing to visit Zenxin outlet.
This is one of the buss marketing strategies for A&W in the outlet.
 Objective 2: To achieve sales target of $2,000,000 for the first year.
 Goal 2: Achieve a ten percent referral-rate with newly acquired customers.
 Tactic: Refresh the Zenxin website Facebook page to integrate friendlier and
humanistic customer service to customers who “like” the page and reward those
invite their friends to like the page; The rewards can in the form of giving free
tissue wallet on their next purchase; increase number of “likes” by 20,000 within
one year.
Goal 2 targets families and individuals by making them feel special and desired.

iii. Gaining trust through the customers will strengthen the relationships, potentially
turning the referrals into customers and then increase total sales of the company.
 Objective 3: To achieve estimated 20% market share next 12 months.
 Goal 3: Increase company reputation by utilizing positive media mentions
nationwide by ten percent with a 12 month period.
Tactic: Create and disseminate press release, focusing on positive accomplishments
and activities that evoke good publicity nationwide. This goal aims to enhance

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 public image of Zenxin. A press release can effectively help change and build the
public image of the company. Plus, well-written and distributed press releases can
help to communicate a positive brand image, improve customer perceptions, enlarge
economy of scale and increase bargaining power of the company.

6.4 Promotional Tools

Advertising, Internet marketing and public relations are selected as promotional
tools for marketing strategy.
i. Advertising
Zenxin will use two means of advertising: print advertising and television
commercial advertising. Advertising has not been utilized aggressively by Zenxin
whereby the products and services can have their own advertisement, be it print or
electronic media, for example,Zenxin has its own print advertisement carrying
tagline “More Than The Usual”.

ii. Internet/ Interactive Marketing

Internet Marketing, on the other hand will be focused on Facebook and Twitter on
creating viral marketing by using rationale and emotional appeal on Zenxin and at
the same time creates two-way communication between consumers and company. It
is suggested tha tZenxin a can launch “Pimp My Zenxin ” contest together with the
universities and residents around Mongolia. The contest requires the competing
schools and the participants to take photo with the scene in Zenxin outlet. They can
“groupie” their moment with Zenxin r and the ambiance in the outlet and then
upload the photos into Facebook and Twitter. The photo with the most “likes” wins.
This will enhance the creativity among university students and residents and at the
same time promotes Zenxin stores.

iii. Public Relations

The objective is critical to introduce Zenxin to prospective consumers. The plan for
the convention is to invite people who cannot make it to Zenxin outlet by fetching
them along the way to the outlet. The efforts including sending emails to the
consumers informing them about the conference and media alerts to local media
outlets informing them of the conference. The conference will feature
seminars on:

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 1. Who Zenxin is
2. Why Zenxin outlet exists in Mongolia.
3. What is next for Zenxin Mongolia.
4. Green-initiatives for Zenxin Mongolia.
TV and media will be invited to the conference for Zenxin Mongolia. The
advertising time for TV is 8pm to 10pm because those are the time that most of the
families will spend their time watching TV and family activities (SheeHan, 2011).
Therefore,Zenxin can spread the new product launching news for the targeting
family.
It is hope that Zenxin is able to gain large number of new customers and generates
positive media reports on Zenxin.

6.5 Pricing Strategy

Pricing is an important strategic issue because it is related to product positioning.
Further, pricing affects other marketing mix elements such as product features,
channel decisions and promotion (SheeHan, 2011).

i. Cost-plus Pricing - The company can set the price at the production cost,
including both cost of goods and fixed costs at the current volume, plus a certain
profit margin (Belch & Belch, 2001). In Zenxin, the product and service cost in
variable costs (raw materials) and production costs, and at the current sales
volume the fixed costs. The company decides that they want to achieve at a 25%
profit margin.

ii. Odd Pricing

The company can use the technique known as odd pricing that prices end in odd
number (5,7,9) because the studies shows that selling for $10.95 appears cheaper
than the same item priced at $11.00. Psychological techniques such as odd pricing
can be used to certain customers’ interests (Belch & Belch, 2001).

6.6 Contingency Plans

While carefully planning was involved in setting the strategic goals for Zenxin, it
may be that these goals are not met. Therefore, for both sales and financial

20
objectives, a 10% negative deviation from expected sales and projection returns on
assets will be accepted.
However, if sales objectives and return on investment are less than 90% of
projections, certain actions will be taken. These actions include:
No. Problems Solution
1. Unacceptable Sales Levels Zenxin, will combat this problem by
during the First Year doubling in-store promotions in the outlet.
Zenxin, will arrange and carry out these
promotions on weekends at peak hours
and
distribute vouchers in the shopping
complex at peak shopping times. If sales
do not
increase within one month of the in-store
promotions, Zenxin, will advertise in the
weekly shopping circulars
of the store for one month.

2. Unacceptable Return on In the event that the business lacks

Equity liquidity, Zenxin,will examine the
accounts receivable procedures and to
ensure that cash flow projections is
reviewed to determine if unforeseen cash
expenses are ndermining the financial
health of the company.
3. Unacceptable Return on If return on assets and owners’ equity fall
Equity below acceptable levels, Zenxin will first
examine and compare the cost of
production per unit and marketing
with sales prices. If the margins are too
thin, a price increase for new product will
be considered.

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7.0 CONTROL AND EVALUATION
The evaluation and control activities will include quantitative methods to
measure the effectiveness of the marketing plan. The purpose of evaluation plan is
ensure each objectives set by the company are accomplished at the end of the
integrated marketing plan.

 Objective 1: To create brand awareness of Zenxin to the consumers.

Evaluation Plan 1: Due to Zenxin proposed advertisements, it is advised that all
advertisements in the marketing plan under do positioning advertising copy testing
to determine whether they are relevant for the marketplace. Positioning advertising
copy testing will help Zenxin evaluate consumer attitude and purchase intentions,
and allow for the consideration alternative messages that may be more appropriate

 Objective 2: To achieve sales target of $2,000,000 for the first year.

Evaluation Plan 2: One of the most economical methods will include intercept
surveys. Intercept surveys are highly effective and will provide instant feedback.
Since Zenxin is concerning about getting more referrals, it is important to
understand the reasons behind missed revenue and the loss of potential customers.
Intercept surveys can help Zenxin to identify customers who made a purchase and
those who did not and why and their chances to recommend other friends to
purchase.
 Objective 3: To achieve estimated 20% market share next 12 months.
Evaluation Plan 3: Theater testing will be used to identify strengths and weaknesses
of broadcast marketing messages and indicate how Zenxin Mongolia’s commercials
will compare against its competitors. Using theater testing, individuals will be told
to watch and critique television program, but their reception to Zenxin brand
message will actually be measure which, in turn, helps to determine brand
preference among the target audience.

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8.0 CONCLUSION
Based on the analysis on various aspects of macro environment of Mongolia,
it is found that there are business opportunities in organic food industry as there are
strong economic growth, increasing demand in organic food and government’s
supports in agriculture development. However, there are business risks of unstable
climate change and lacked of skilled labor noted as well. By taking into
consideration of the analysis of macro environment, business opportunities and risks
in relation to organic food sector, the optimal option for Zenxin to expand its
business to Mongolia is via exporting strategy and international strategy. Exporting
strategy is suitable for Zenxin to penetrate into Mongolia market due to its lower
costs, lower risks, simpler and quicker process. Since there is low cost pressure and
local responsiveness, international strategy is the optimal strategy to be
implemented. In order for Zenxin’s business in Mongolia to success, it is important
for it to plan and implement the four primary operating activities, which are
producing, processing and packaging, exporting, warehousing and transporting and
distributing.

23
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