Running head: PROJECT PROPOSAL
1
Project Proposal
Olivia Watkins
Grantham University
2
PROJECT PROPOSAL
Dutch Bros Coffee
Introduction
Dutch Bros Coffee is a coffee chain in need of global expansion. It is through the
establishment of operations in foreign markets that the coffee chain will experience various
benefits such as greater opportunities for growth and diversification. Dutch Bro coffee
headquarters are located in Grants Pass, Oregon, in the United States with 370 locations. The
current target market is Finland for being the highest coffee consuming nation in the world
("Dutch Bros Coffee," n.d.). Targeting Finland, Dutch Bros will have an expanded market
and workforce. This proposal is aimed at providing analysis to the firm's growth opportunity
in Finland.
Company Overview
Dutch bros coffee is the largest privately owned coffee chain in the United States. It
was founded in 1992 by Dane and Travis Boersma, who are brothers of Dutch descent. The
firm began after the brothers closed their dairy business as a result of government regulations.
Currently, the firm is the largest privately held drive-thru chain with over 370 locations in 7
states and 12,000 employees ("Dutch Bros Coffee," n.d.). The coffee chain is known for
giving away over one million free drinks every year as a way of maintaining its roots. The
free drinks strategy is to spread the Dutch connection, "Spreading the Dutch Luv." The
company also engages in philanthropic activities donating over $2 million every year to both
the local and non-profit organizations, which include the Muscular Dystrophy Association,
among others. The firm has an extensive loyal customer base, dubbed the Dutch Bros coffee
fostering growth in its business operations, the donations, and love.
3
PROJECT PROPOSAL
Finland market
Coffee market
Finland is a perfect market for the Dutch Bros coffee because of the heavy
consumption of coffee by the Finns. In 2017, Finland was classified as the top coffee
consumer in the world. Finland is well known for its high consumption of coffee with every
person consuming at least 12kg every year or rather 10 cups per day "Coffee in Finland: A
Growing Market," 2019).
Coffee in Finland is similar to a culture. The Finns are very passionate about coffee.
In the early 1700s, The Finnish used coffee as a medicine for curing headaches, depression,
and other illnesses. Currently, it is similar to an institution in the nation, with almost everyone
consuming it everywhere and at any time of the day ("09 Coffee, tea, maté and spices:
Finland," 2019). It is consumed not only to energize them but also to socialize. Serving
coffee is regarded as one of the most significant acts of hospitality. Whenever a guest is not
served with coffee, he/she is likely to regard it as an insult.
In recent years, Finland has experienced rapid growth of various coffee bars that serve
quality coffee. The coffee bars offer home-like interiors to make the consumers comfortable
even after they have finished drinking their coffee. At times, consumers enjoy the atmosphere
is even when they are not drinking coffee. It will be fortunate for the Dutch Bros coffee to
enter the Finland coffee market because the major coffee chains have not dominated the
market. The industry consists of approximately 11 thousand businesses, which comprise
hotels, bars, and restaurants, among other food services "Coffee in Finland: A Growing
Market," 2019). The most widely served drink is Filter Coffee, although the cappuccino and
expresso are still showing a positive trend.
Finland economy
PROJECT PROPOSAL
4
Finland's economy is somewhat healthy, with a GDP of $244 billion and a growth of
3.0 percent. The country also has a population of 5.5 million and an unemployment rate of
8.6 percent. The country's economic freedom score is 74.9, making it the 20th freest economy
in the 2019 index. The score has increased by 0.8 points following the improved fiscal
health, increased government spending, and monetary freedom ("Consolidated Flows, Sector
S1 - Total Economy: Finland," 2019).
Consumer behavior
Finland is a complex market with high standards of living and an adequately educated
workforce. The consumer’s purchasing power has recently increased, resulting in increased
imports. The consumers are also open to new products and services. The top priority for
consumers in Finnish is quality when making selections. The purchasing power for
consumers is also promoted by the Finns confidence in their financial situation and the
increased debt levels.
The most critical factors influencing Finnish consumer behavior is product origin,
quality, and safety ("Coffee culture in Finland: a story of togetherness," 2019). A brand is
regarded as a strong mark of quality. Finns tend to favor national products and have increased
their investment in food quality. Finns are also familiar with technology, and they often
purchase products online. Studies have reported that internet retailing is still on the rise, and
mobile commerce will be booming in the next few years.
Mode of entry
The best method of entry for Dutch bros coffee is direct exporting. The coffee chain
will sell directly into the Finland market. Once the company establishes a sales program, it
will use agents to represent it to the market. The agents will work closes with the company to
represent the company's interest. They will act as the face of the company and will be treated
PROJECT PROPOSAL
5
as the principal staff person (Singh, n.d). Direct exporting will give the coffee chain full
control over the product. The firm will also determine the term of sale according to the
competitive trends in the Finland market.
The coffee chain will also localize its operations. This is because the chain is already
established in the United States, and there is no need to start a fresh one. Since the firm is
aware of Finn's preferences, it is easy to localize its operations in Finland. Since the Finland
market holds a high value for coffee, comparatively lower prices can increase the reputation
for the Dutch bros coffee in Finland. Increased reputation will increase its effectiveness in
control over its coffee products. Finland coffee bars are designed to offer comfort to
consumers, and the direct exporting method will help the firm in developing an effective
after-sale service. The coffee chain can provide efficient after-sales service to utilize the
market potential to the advantage that it is directly exporting the coffee.
The best method of establishing a path to success is by partnering with the local
coffee chains. The local coffee chains have a clear understanding of the coffee industry in
Finland. They are aware of the business models and the essential methods for tapping talent
pools and how to source for the best products and services. The partner will also have a
reputable network of acquaintances that will help the business save valuable time and money.
Lastly. Merging with the partner can also be very effective in tapping Finland's local talent
pool, which will improve the market power for the business (Singh, n.d). A well-established
partner will challenge the coffee chain's ideas and will integrate both commercial acumens
with creativity as a method of adding value to the firm's team.
6
PROJECT PROPOSAL
References
09 Coffee, tea, maté and spices: Finland. (2019). doi:10.1787/c46fcf15-en
Coffee culture in Finland: a story of togetherness. (2019, December 6). Retrieved from
https://allthingsnordic.eu/coffee-culture-in-finland-a-story-of-togetherness/
Coffee in Finland: A Growing Market. (2019, April 19). Retrieved from
https://coffeebi.com/2018/03/28/coffee-in-finland-a-growing-market/
Consolidated Flows, Sector S1 - Total Economy: Finland. (2019). doi:10.1787/c7e0a86d-en
Dutch Bros Coffee. (n.d.). Retrieved from https://www.dutchbros.com/
Finland Economy: Population, GDP, Inflation, Business, Trade, FDI, Corruption. (n.d.).
Retrieved from https://www.heritage.org/index/country/finland
Singh, N. (n.d.). International e-business expansion and market entry strategies. Localization
Strategies for Global E-Business, 28-54. doi:10.1017/cbo9780511920226.003
Purchase answer to see full
attachment