Group Project

MKT-417 Sec. 1
Instructor:
Samy Ahmed

S u b m i t t e d BY
Name

ID

Md. Emran Hoque Razi

073025030
M. Habibullah Sarker 073038030
M. AsifUl-Islam 073276030
Sanjid Ahmed
Nasiful Huda Khan

073696030
081105030

Ta s m i a J a r i n 0 8 2 1 9 7 0 3 0

Submission Date
2

n d

November 2011

TABLE OF CONTENT
1.
2.
3.
4.

Executive summary.2
Country profile.4
Export preliminary7
Political & Legal
environment.8
5. Foreign relations9
6. Company Profile..10
7. Group structure11
8. Mission & Vision..12
9. Product line.13
10.Post Sale service15
11.Demand conditions..16
12. Main Competitors.17
13. Company analysis18
14. Swot analysis....23
15. Reasons engagement in
internationalization..24
16. Entry mode.........24
17. Recommendation.25
18. Conclusion........25
19. Reference.........26

Executive Summary
Our company Viaggio (Its an Italian word means Journey) is Bangladeshi
joint venture with IRISBUS IVECO of Italy. We mainly import BUS parts
from IVECO and assemble them in Bangladesh & export Buses from other
country. Now we are planning to enter in Nigeria through a distribution
channel. They have the infrastructure and they have huge need for Buses.
So its a very potential market for our product.
Our company wants to internationalize its product because it wants to
expand its market share by gaining access to new markets and also
wanted to achieve economy of scale by grabbing the opportunities that
the new market provides.

Demand for public transportation is rising day by day in Nigeria. Rising oil
and gas price are forcing people to use public transport. Its become very
expensive to maintain Private Transport. So our well facilitated city buses
will be a great option for them.
According to our calculation our target market size is 70% of total
population which is 155,215,573. They use public bus as their main
medium of transport for day to day journey and rest of the people are not
using the public transport. We are targeting those people who are
frequent user of public transport.

Irisbus Iveco is an international company that offers a full and continually

evolving range of buses and coaches.
For many years Irisbus Iveco has pursued a policy of environmental care
which has involved continually increasing investments in research and
development of environmentally friendly vehicles.
This commitment is not limited to compliance with regulations but also to

find solutions that ensure maximum efficiency, taking into account

customer needs both in terms of performance and profitability.
The Irisbus Iveco urban range offers many different lengths, engines
and equipments able to meet the requirements of public transport
companies and passengers in terms of accessibility and environmental
care, for a more and more sustainable mobility.

Country profile:
Background:
Following nearly 16 years of military rule, a new constitution was adopted
in 1999, and a peaceful transition to civilian government was completed.
The president faces the daunting task of rebuilding a petroleum-based
economy, whose revenues have been squandered through corruption and
mismanagement,

and

institutionalizing democracy. In addition,

the

OBASANJO administration must defuse longstanding ethnic and religious

tensions, if it is to build a sound foundation for economic growth and
political stability. Despite some irregularities, the April 2003 elections
marked the first civilian transfer of power in Nigeria's history.
Location:
Nigeria is located in West Africa, bordered by Benin to the west, Niger to
the north, Cameroon to the east and the Atlantic Ocean.
Area

923,768 sq. Km

Population

158.2 million

Government type

Republic transitioning from military

to civilian rule

Economy - overview:
Oil-rich

Nigeria,

long

hobbled

by

political

instability,

corruption,

inadequate infrastructure, and poor macroeconomic management, is

undertaking some reforms under the new civilian administration. Nigeria's
former military rulers failed to diversify the economy away from
overdependence on the capital-intensive oil sector, which provides 20% of
GDP, 95% of foreign exchange earnings, and about 65% of budgetary
revenues. The largely subsistence agricultural sector has failed to keep up
with rapid population growth - Nigeria is Africa's most populous country and the country, once a large net exporter of food, now must import food.
Following the signing of an IMF stand-by agreement in August 2000,
Nigeria received a debt-restructuring deal from the Paris Club and a $1
billion credit from the IMF, both contingents on economic reforms. Nigeria
pulled out of its IMF program in April 2002, after failing to meet spending
and exchange rate targets, making it ineligible for additional debt
forgiveness from the Paris Club. The government has lacked the political
will to implement the market-oriented reforms urged by the IMF, such as
to modernize the banking system, to curb inflation by blocking excessive
wage demands, and to resolve regional disputes over the distribution of
earnings from the oil industry. During 2003, however, the government
deregulated fuel prices and announced the privatization of the country's
four oil refineries. GDP growth probably will rise marginally in 2004, led
by oil and natural gas exports.
GDP

$212bn

GDP growth rate

3.4%

Highways

Total: 194,394 km
5

Country risk analysis

Now a days, global business era country risk analysis is mandatory for
achieving success. We need to understand what risks are involved in a
Subsequently if any foreign investor wants to start business in Nigeria,
this is prerequisite to do a broad country risk analysis on the country
Nigeria, which will help to deal with Nigerias environment and ultimately
which will direct to achieve organizational goal.
Among so many risks, some risks must be identified;

Corruption overall ranking: 137 out of 183 countries (2010)

Cultural Issues: Nigeria's capitalist economy was liberalized during
the 2000.
Bureaucracy: Nigerian government is rarely accountable to public
officials.
Criminal activities and fraud: Nigeria consist organized criminal
activities.
Unique cultural issue: Nigerian people are very xenophobic.

Extremism: Rarely and creates hostility, havoc and vandalism.

Export Preliminary
For Exporting in the Nigerian state the exporter needs to obtain a
certificate. This certificate is known as the SONCAP (Standards
Organization of Nigeria Conformity Assessment Programme). The
process is mentioned below:

This procedures are only applicable to certain products:

Food Products

Drugs

Medical Products (other than equipment and machines)

Chemicals used a Raw Materials

Military Ware and Equipment

Aviation Related Products

Industrial Machinery for Manufacturing

Used Products (other than Automobiles)

CKD Bicycles, Motorcycles, Automobiles for Bonfire Manufacturers/

assemblers

Political and Legal environment in which the country currently

operating
Political Environment:
Nigeria is a Federal Republic modelled after the United States, with
executive power exercised by the president and with influences from the
Westminster System model in the composition and management of the
upper and lower houses of the bicameral legislature. However, the
President of Nigeria is both head of state and head of government, and of
a multi-party system. Nigerian politics takes place within a framework of a
federal,

presidential,

representative

democratic

republic,

whereby

Executive power is exercised by the government. Legislative power is

vested in both the government and the two chambers of the legislature,
the House of Representatives and the Senate. Together the two chambers
8

make up the law-making body in Nigeria called the National Assembly.

The highest judiciary arm of government in Nigeria is the Supreme Court
of Nigeria. Nigeria also practices Baron de Montesquieu's theory of the
separation of powers. The National Assembly serves as a check on the
executive arm of government.
The 1999 constitution provides for a bicameral National Assembly
consisting of a 360-member House of Representatives and a 109-member
Senate. The president heads the executive branch. The judiciary includes
a

Supreme

Court

and

lower

courts.

In April 2011, the Independent National Electoral Commission organized

legislative, gubernatorial, and presidential elections. The opposition Action
Congress of Nigeria captured additional governorships and National
Assembly seats, although the majority of such positions continued to be
held by the ruling PDP. President Jonathan captured 59% of the national
vote, beating his main rival, MuhammadBukhara of the Congress for
Progressive Change, who won 32%. While imperfect, the elections were
considered Nigerias most successful since its return to multiparty
democracy in 1999, and reversed a downward trajectory of successively
flawed election processes. President Jonathan was sworn in on May 29,
2011.

Foreign Relations:
Since independence, Nigerian foreign policy has been characterized by a
focus on Africa and by attachment to several fundamental principles:
African

unity

and

independence;

peaceful

settlement

of

disputes;

nonalignment and non-intentional interference in the internal affairs of

other nations; and regional economic cooperation and development. In
pursuing the goal of regional economic cooperation and development,
9

Nigeria helped create the Economic Community of West African States

(ECOWAS), which seeks to harmonize trade and investment practices for
its 15 West African member countries and ultimately to achieve a full
customs union. Over the past decade, Nigeria has played a pivotal role in
the support of peace in Africa. It has provided the bulk of troops for the
UN peacekeeping mission in Sierra Leone (UNAMSIL), the UN Mission in
Liberia (UNMIL), and many of the troops to the African Union Mission in
Sudan
Nigeria

(AMIS).
has

enjoyed

generally

good

relations

with

its

immediate

neighbours. A longstanding border dispute with Cameroon over the

potentially oil-rich Bakassi Peninsula was addressed by International Court
of Justice (ICJ) in The Hague in 2002. The ICJ awarded most of the

Company Profile:
Irisbus Iveco is an international company that offers a full and
continually

evolving

range

of

buses

and

coaches.

For many years Irisbus Iveco has pursued a policy of environmental

care which has involved continually increasing investments in research
and

development

of

environmentally

friendly

vehicles.

This commitment is not limited to compliance with regulations but also to

find solutions that ensure maximum efficiency, taking into account
customer needs both in terms of performance and profitability.
History:

10

Fiat Industrial began operations on the 1st of January 2011 following the
demerger of the activities of Iveco, CNH and FPT Industrial from Fiat
S.p.A.
This demerger gave life to an industrial and commercial enterprise (listed
on the Milan Stock Exchange) with a clear strategic focus, financial solidity
and the independence necessary to realize the maximum potential for its
trucks and commercial vehicles, agricultural and construction equipment
and industrial and marine powertrain businesses.
The group has behind it the vast know-how of Fiat which began producing
tractors, trucks, buses and marine engines more than 100 years ago. The
CNH and Iveco brands inherited a grand tradition of historic achievements
and technological know-how. They have continued to build on that base
and today, with their proven experience and innovative capacity, are
among the global leaders in their respective sectors.

Group Structure:

11

VISION
To be the best-in-class performer in our industry continuously delivering
value, quality and success to our customers and their businesses.

MISSION
To deliver solutions to passenger transport industry leveraging our
excellent know-how, our care for people and our partnerships worldwide.

Values
Commitment:
We take responsibility in all we do. We challenge our working practices
with a view to take upon ourselves the need of customers, the
shareholder, our colleagues and a society as a whole. For the purpose, in
our everyday business as well as innovation efforts we seek continues

12

product and service improvement with priorities on customer productivity,

environmental care and safety.

Reliability:
We consider delivering as a way of life both across our organization and
towards our customers. Iveco people create and spread our company
reputation through delivering reliable and quality products.

Our product line

The Irisbus Iveco urban range offers many different lengths, engines
and equipments able to meet the requirements of public transport
companies and passengers in terms of accessibility and environmental
care, for more and more sustainable mobility.
IRISBUS IVECO city buses
IRISBUS IVECO intercity buses
IRISBUS IVECO tourist buses
IVECO minibuses

Our product
Based on our marketing research and customer demand analysis, we
decided to export the following type of bus to Nigeria.
Bus IRISBUS IVECO CROSSWAY LE CITY 12M - 2 Door
13

The new low-floor Crossway LE city bus chain IRISBUS IVECO,

designed and built in Vysokm Mt, is named after the original Crossway
bus. The Crossway LE bus fulfils many of the requirements of the city bus
Citoles. The Crossway LE is low-riding in the front of the bus, making
boarding the bus easy and comfortable. This also makes the bus
affordable. The bus is also equipped with a ramp for disabled people and
kneeling system.

The new designs were based upon those of the Karosa B 900 due to
its success as a city bus: Low fuel consumption, great safety record,
comfort and easy access. The IRISBUS IVECO Crossway LE CITY bus is
12m in length.

IRISBUS IVECO CROSSWAY LE CITY Bus 12M - 2 doors

ENGINE
CROSSWAY

LE

CITY

2D

TECHNICAL DATA

length 11 995mm, width 2

550mm, height 3 125mm

maximum load on front axle 6

engine Iveco Tector / Cursor 8

(EURO 4)

Max. power 194 kW / 243 kW

torque 1 000 Nm / 1 500 Nm

VOITH automatic transmission

MERITOR back axle with easy

500kg

14

maximum load on back axle 11

500kg

front door step height 320mm

middle door step height 330

mm

reduction

wheels with disk brakes, ABS,

ASR

number of available seats 3338, up to 75 standing positions

Post Sale Services:

warranty and post warranty service and all other repairs on Irisbus
Iveco, Karosa, S 91, Beulas buses

vehicle diagnostics

body work and repairs on buses that have been in accidents

vehicle electronic repairs

installation and service of EBERSPACHER heating

upholstery Service Boskovice

measuring emission levels in compression-emission engines

verification and installation of Veder-Root, Kiencle, Actia, Siemens

analogue and digital tachographs Service: Prague, Vykov,
Boskovice

installation, in warranty and post warranty service of THERMO KING

air conditioning and cooling systems - Service Prague

15

Target Market:
According to our calculation our target market size is 70% of total
population which is 155,215,573. They use public bus as their main
medium of transport for day to day journey and rest of the people are not
using the public transport. We are targeting those people who are
frequent user of public transport.

Figure: Transport user ratio

Demand Condition
Demand for public transportation is rising day by day in Nigeria. Rising oil
and gas price are forcing people to use public transport. Its become very

16

expensive to maintain Private Transport. So our well facilitated city buses

will be a great option for them.

Main competitor: Following companies are currently occupying majority

of market share in this industry. So they are our main competitors.

American Ikarus
AM General
The Flexible Company
Gillig Corporation

17

General Motors Corporation

Highway Products, Inc.
Mack Trucks
Motor Coach Industries
New Flyer Industries
NovaBus Corporation
Orion Bus Industries/Bus Industries of America
Tokyu Car Corporation

Competitor Analysis:
American ikarus:
This company is located in Anniston, Alabama. American Ikarus build in
1996. Its model is 416 and fleet numbers are 9501-9517. The companys
divisions are assigned in Babcock/William. Many buses of this company
have already retired.

Am General:
This company is located in South Bend, Indiana. Its started in 1975-1976.
The model number of this company is 9640AMetropolitan and fleet
numbers are 4001-4070. Remainder of buses retired prematurely due to
serious structural issues, and was replaced temporarily in 1987 with
surplus Flx buses from Rochester and GMC RTS-01 series buses from
Dallas.

18

The Flexible Company:

The company is located in Loudonville, Ohio. Its started in 1970. The
model number of this company is 111CD-D5 and the fleet numbers are
301-305. The company purchased second-hand from RGRTA (Rochester) to
fill gaps in buses, due to the emergency retirement of the fleet of AMG
buses. Bus original fleet numbers in Rochester were 530, 569, 575, 560
and 572.

Gillig Corporation:
This company is located in Hayward, California. The company started its
frontier and Babcock/William division in 2001. Its model number is
Advantage T40 and fleet numbers of Wheel chair is 2101-2141. First buses
to be equipped with amber colored LED destination signs2118 were
withdrawn after catching fire in front of Seneca High School. The same fire
also destroyed bus 9538. The company again launched the Advantage
T40 in 2002 whichs fleet numbers are 2201-2242. 2242 buses are out of
service due to extensive front end damage. Gillig Corporation launched
Advantage T29 of Frontier and Babcock/William in 2004 whichs fleet
numbers is 2401-2422. At present, these are the only 29-foot (8.8 m)
buses in the fleet. First buses fitted with bicycle racks on the front. The
model Advantage T40 of Babcock/William again launched in 2005 whichs
fleet numbers is 2501-2515. 2506 buses involved in accident with a
tractor-trailer that severely damaged its frame. Bus is not salvageable.
The next year in 2006 the company introduced its Advantage T40 Hybrid
of Babcock/William whichs fleet numbers are 2601-2630. First batch of
"Hybrid" buses were using combination diesel/electric technology. Energy
is returned to batteries upon braking. The model Advantage T40 of
Frontier launched in the very next year whichs fleet numbers is 27012713. It was Diesel-Electric. The Cold Spring division of the company was
assigned in 2010. The model of it was Low Floor T40 Hybrid and the fleet
number was 1001-1011. The specialty of its are given below

Diesel-Electric

Entered service April 1st 2010

19

All 1000-series buses mark a return to full fiberglass passenger

seating

Gillig Corporation launched Low Floor T40 Diesel of Frontier and

Babcock/William in the same year whichs fleet number was 1012-1065.
First buses delivered to NFTA under the new EPA 2010 Emissions
standards. In 2011 the company again launched Frontier and Cold Spring
whichs model and fleet numbers are consecutively 40 Low Floor Trolley
Replica, Low Floor T40 Hybrid and 1066-1067, 1101-1030. In Frontier the
company initially offered in 29 or 35 feet, the NFTA was the first agency to
receive the 40 foot version. While primarily used for the 55T Niagara Falls
tourist line, these buses will see occasional service on certain regular
NFTA routes, such as the 3-Grant and 20-Elmwood. In Cold Spring it was
just diesel-electric.

Highway Product Inc.:

This company is located in Kent, Ohio. The company started in 1975 in the
division of withdrawn. The model of it was TC-31B"Twin Coach and the
fleet numbers was 3001-3012. The specialties of the buses are as followsa) Former Lockport Bus Lines buses.
b) First buses equipped with wheelchair lifts.

General Motors Corporation:

The company is located in Pontiac, Michigan. The fleet number of the division
withdrawn was 7001-7030 which started in 1954 and the model was TDH-

5106. These were all Former Niagara Frontier Transit Buses. In 1957 these
buses were again launched whichs fleet numbers was 7100-7114. In 1958
the company launched TDH-5106 fleet numbers of 300-319 whose were
all Former Buffalo Transit, Inc. Buses. In the next year the company
20

launched a new model of SDM-4501 fleet number of 166-168 which were

former Grand Island Transit 66 & 68, acquired in 1975. In 1960-1961 the
model TDH 5301 fleet numbers of 7401-7459 came to the market which
was all transit system buses. Another model TDH 5304 fleet numbers of
7501-7549 came to the market in 1963. In the following two years the
same model buses launched whichs fleet numbers was 7600-7684 and
7685-7719. The company launched model SDM-5302 fleet numbers of 104
in the year 1967 which also were former Grand Island Transit 104,
acquired in 1975. In 1968 a new model of T6H 5306 fleet numbers of
7720-7794 came to the market. The model S8M-5303A fleet numbers 114
launched in 1970 which were also former Grand Island Transit 114,
acquired in 1975. The version 7754 retained as "heritage" bus. The model
and fleet numbers of the buses launched in 1978-1979 were T8H-603
"RTS-03" 5001-5065.

Mack Trucks:
The company located in Allentown, Pennsylvania. Its started in 1957 with
the model C49-DT fleet number 6200-6244 in the division withdrawn of
former Niagara Frontier Transit System buses. In the next year the same
model came with a fleet number of 6300-6359 for former Niagara Frontier
Transit System buses and first order built with Mack New Look front.

Motor Coach Industries:

The company located in Roswell, New Mexico. The only model TC40-102A
"Classic" of the company launched in 1992 with a fleet numbers of 401417 in the withdrawn division.

New Flyer Industries:

21

The company located in Winnipeg, Manitoba. This company also launched

its only model D40HF fleet numbers 9301-9375 in the withdrawn division
whose 9318 painted in International Railway Company colors: dark green
with cream and rust accents and gold crest logo and the name
INTERNATIONAL on the sides. Later on its repainted in the blue/silver
livery.

NovaBus Corporation:
The company located in Quebec. The only model TC40-102A "Classic of
this company launched in 1996 whichs fleet numbers is 9601-9641 and
was in the division of Cold Spring. Some buses have already retired. A few
buses are still painted in the "earth tone" livery.

Orion Bus Industries/Bus Industries of:

The company is located in Oriskany, New York. It launched the model 01.509
"Orion I" fleet numbers 601-607 in withdrawn division in the year 1985.
This company purchased the last new non-wheelchair lift-equipped buses
in that year. The next year the company launched the model 01.508
"Orion I" fleet numbers of 701-773 in the same division. Buses 703, 756,
768 and 772 were sold to RGRTA (Rochester), buses 720, 729, 741 and
757 were sold to BC Transit (Binghamton), and one to Poughkeepsie
Transit. First buses equipped with interior "Stop Requested" sign when bell
is pulled. After two years same model with fleet numbers of 806-816
launched with a specialty of first electronic "flip-dot" destination signs.
The model 01.502 "Orion I" fleet numbers of 851-852 launched in the
same year. In 1990 the company again launched the model 01.508 "Orion
I" fleet numbers of 921-925. It was the last OBI I buses and of those buses
925 was fitted with "hopper" type windows rather than sliding windows.
First buses, along with 861-867 with fabric covered inserts in the
passenger seats.

22

Tokyu Car Corporation:

The company located in Yokohama, Japan. In 1983 the company launched
its product in the market fleet numbers of 101-127 in the South Park
division. The cars were all Metrorail cars and the entire fleet is being
rehabilitated at Gray Manufacturing Industries in Hornell, New York a few
cars at a time.

SWOT Analysis
Performance

23

STRENGTH

(Minor)
Marketing

(Major

Weakness
(Minor)

(Neutral)

(Major)

1. Company reputation
.

..

..
2. Customer acquisition
.

...
.
..
3. Customer satisfaction
.

..
.
4. Customer retention
.

..
.
5. Product quality
.

..
..
6. Service quality
.

..
..
7. Promotion effectiveness
.

..
..
8. Sales force effectiveness
.

..
..
9. Innovation effectiveness
.

..
..
10. Geographical coverage
.

..
..
11. Technological advancement .

..

..
12. Market positioning
.

..

..
13. Psychological attachments
.
.
..

14. Voluntary Services

.

..

..
Finance
15. Capital
.

.
16. Cash flow
.
.
..
17. Financial stability
.

.
18. Cost effectiveness
.

..
19. Pricing strategy
.
..
.
20. Market share
.
.
..
21. Economies of scale
.
.
..
Human Resource
22. Dedicated workforce
.

.
23. Technical workforce
.
..
.
24. Adequate stuff
.
..
.

.
.

..

..

..

..

..

..

24

25. Efficient stuff

..

..

Organization
26. Visionary capable leadership
.

..
.
27. Entrepreneurial orientation .

..
28. Flexible response
.

..
..
29. Business diversification
.
.
..
..
30. Competition
..

.
..

..

Reasons for engaging in internationalization

Market-Seeking motives:
Gain access to new markets or opportunities:
Our company wants to internationalize its product because it wants to
expand its market share by gaining access to new markets and also
wanted to achieve economy of scale by grabbing the opportunities that
the new market provides.

Entry Mode: Exporting

Our company Viaggio (Its an Italian word means Journey) is Bangladeshi
joint venture with IRISBUS IVECO of Italy. We mainly import BUS parts
from IVECO and assemble them in Bangladesh & export Buses from other
country. Now we are planning to enter in Nigeria through a distribution
channel. They have the infrastructure and they have huge need for Buses.
So its a very potential market for our product.

25

Timing of Entry
No other Bus company currently offering luxurious air conditioned buses
so if we enter with our luxuries city bus then we will enjoy the first mover
advantage in this market.

Recommendation:
While doing the project, we found several problems. There are some
restrictions in case of import/export from Bangladesh to Nigeria. So, we
recommend a few things to keep in mind.
In case of import from Italy to Bangladesh we faced huge problem.
There is a huge import tax on spare parts of buses imported from
any foreign country, but the tax is very low if we buy from any
domestic or any foreign company manufacturing the spare parts in
Bangladesh.
The bureaucracy of Bangladesh was a challenge for us. All the
papers that are necessary for exporting any product are very much
difficult to get in Bangladesh. So, we suggest that in case of
exporting any product there must be good preparation and enough
time in hand to handle this problem.
The banking process must be good enough to have the faith of the
consumer.
Lastly we recommend that in case of export any product from
Bangladesh everyone related to this business must enthusiastic
enough to handle the political and infrastructural problems.

Conclusion
26

Nigeria has a most developed roads and highway infrastructure among

the African country. Their main communication medium is roads and
highway. According to our market research and market segmentation its
clear that Nigeria needs a lot of new city buses to fulfil their
communication need. With the current infrastructure, political and
economic condition in Bangladesh, we hope that with all necessary steps
we will successfully be able to export bus to Nigeria.

Reference:
http://english.aljazeera.net/news/africa/2011/04/2011414103045300941.html
http://www.irisbus.com/en-us/irisbus/pages/vision.aspx
http://www.fiatindustrial.com/en-US/group/awards/Pages/premi.aspx
http://www.tezas.cz/irisbus-iveco-buses

27

28