Markets Analysis

Table of Contents

Introduction ..................................................................................................................................... 1
Strengths ......................................................................................................................................... 3
Weaknesses ..................................................................................................................................... 3
Threats............................................................................................................................................. 4
Opportunities................................................................................................................................... 5
References; ...................................................................................................................................... 7

INTRODUCTION
Marketing analysis is the detailed study or examination of marketing environment. Marketing
environment is a set of external forces that directly or indirectly affect the influence of marketing
programs that is marketing practice and decisions. Usually marketing does not occur in a vacuum
or an empty space that means marketing programs operates in a dynamic environment and the
changes or trends in the environment may bring about opportunities or threats.

There are two components of Marketing Environment which are External Environment and
Internal Environment. External Environment consists of Macro Environment and Micro
environment

Macro Environment consists of forces that broadly affect many firms or businesses; these are
forces which are beyond the control of an individual firm. The elements or aspects of macro
environment are as follows;

 Political factors such as political stability, risk of military invention, trade regulation, taxation
and intellectual protection.
 Economic factors for instance inflation, interest rate, economic growth, business cycle. These
factors affect demand, price and sales level.
 Social factors for example culture, education, entrepreneurial spirit, demographic factors,
population size, age and distribution and family size.
 Technological factors by the use of electronic communication tools like e-marketing and e-
advertisement.

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Micro Environment consists of forces that an individual firm can control. The Elements of Micro
Economics Environment are as follows; Competitors, suppliers, customers, intermediaries and
local community.

Internal Environment consists of functions that give rise to strength and weaknesses for example
resources available (human resources, financial resources), culture of the firm, policy and mission,
company image, research and development.

By using marketing analysis techniques of marketing environment as discussed, Tanzania Portland

Cement Company (TPCC) selected as area of the study. TPCC was established by Cementia
Holdings AG of Switzerland in 1959 as a subsidiary of the Heidelberg Cement Group with the
primary activity of manufacturing and selling cement and in1966. Heidelberg Cement via Scancem
International DA is TPCCs’ major shareholder currently holding 69.25% of shares, the remaining
30.75% shares owned by the public of the United Republic of Tanzania. Hence, environmental
scanning used as the process of collecting information about the forces of marketing environment.
In addition to that, this process helps to generate what we call SWOT analysis of TPCC, whereby
SWOT analysis means strength, weakness, opportunities and threats. Below is an illustration of
SWOT analysis.

Figure 1:1 SWOT analysis

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STRENGTHS
These are resources, skills or other advantages relative to competitors and the needs of the market
a firm expects to serve. Examples of the strengths that TPCC has are as follows;
Innovation and financial support; TPCC learns new things, ideas or other ways of doing their
activities and financial support from their motherland industry called Heidelberg cement, which is
in German.

Location; TPCC’s headquarters is situated in one of the biggest capital cities in East and Central
Africa that is the base where all the economic development activities done. For example, TPCC’s
exportation of cement through Dar es Salaam port to different countries like Burundi, Rwanda.

Marketing experience; TPCC has deliberate activities which put customers within their brand
name (Twiga Cement) through stimulation of their senses, which turns out to be a positive impact
and enthusiastic to the company.

Close relationship with customer; TPCC has a long-term customer relationship compared with
other cement companies (Dangote, Nyati, Mbeya cement) and hence enhance loyalty.

Experience for more than twenty years; TPCC as a limited company has experience in providing
quality service products to the community and engaging in cement industry sector for more than
20 years that is quite different from any other company community like Nyati , Dangote and Mbeya
cement.

WEAKNESSES
These are deficiencies in resources, skills and capabilities that seriously impede company’s
effective performance. Some of the weaknesses of TPCC are as follows;

Insufficient distribution system; TPCC has a very big shortage its distribution system compared
to its main competitor Dangote Cement co. who owns over 300 transportation trucks.

Environmental pollution; TPCC is not putting enough measures to protect the community and
its environment. There is a lot of air pollution surrounding the plant location since it uses natural
gas that emits methane into the air which is harmful to all living things.

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Inadequate price control system; TPCC has not managed to control price for its product
especially in rural areas whereby the prices tends to go high due to transportation cost.

Outdated Research Information; TPCC has failed to use updated information about the market
due to high cost in undertaking research. They spend too much on stock inventory while there are
many competitors

THREATS
These are major unfavorable situation in a firm’s environment. Some of threats of TPCC are such
as;

High competition; currently TPCC is facing great challenge from its main competitor known as
Dangote who has merged in cement industry in Tanzania with international grade standard of
cement production.

Fluctuation of share prices; TPCC is one of the few cement companies that trade on shares hence
it has a mandate of keeping up good performance in the market in order for its securities like
securities to fetch good prices in the market.

Changes in government laws, regulations and policies; for the past years a lot of government
laws, policies and regulations have been amended and trade sector is one of those areas that have
been affected by these amendments. For instance control over the usage of natural resources (coral,
clay, clinker and gypsum) and tight implementation of tax policies.

Technological advancement; for instance Dangote Cement industry is very promising as far as
technological upgrading is concerned such that it even plans to generate its own electricity and
share the same with the surrounding community hence improve its production and gain customer
loyalty.

Increased research and development cost; research has proved to be one of the very expensive
components in developing organization activities because it needs a lot of funds and sacrifice.
However for those who do not conduct research frequently may not meet well consumers’ demand.

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OPPORTUNITIES
This is major favorable situation in firm’s environment. Some of TPCC opportunities are as
follows;
Growing technology in Cement industry; TPCC can deploy Research and development
initiatives as a tool to identify different opportunities and existing gaps that require acquisition of
relevant technologies to be used. And also investment in increased technology change will
influence TPCC to create more production, lowering production cost, improving product delivery
capacity and efficiency.

Government spending plan; It has been observed that government expenditure plans in financing
its project activities create good investment opportunities. Government priorities have been to
improve infrastructure such as construction of roads both on surface and fly over roads. The
shifting the capital city from Dar es Salaam to Dodoma has stimulated both government and private
real estate investors to construct buildings in Dodoma in order to seize the opportunities.

Unsatisfied population/new demand; Studying at the Tanzania population trend based on census
conducted on 2012 definitely it will be realized that the population growth in Tanzania is high.
The population tripled from 12.3 million 1967 to 44.9 million and it is estimated to reach 57.79
million at the beginning of 2018 (UDP, 2017).

Good government tax incentives on export; TPCC has an opportunity to enjoy good tax
incentives posed by the government to encourage investment in production industry. TPCC can
increase its production and increase its sales due to removal of Value Added Tax on exportation
set by Value Added Tax Act, 1997 where by all exports are zero rated.

Access to regional economic integration market; Being a member of several regional

integrations such as East African community (EAC) and Southern Africa Development
Community (SADC), TPCC can use the opportunities of the increased market size in the member
counties to sale its product and enjoy the economic benefits set by the integrations such as removal
of trade barriers between the members.

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Customer loyalty
This occurs when the customers consistently are satisfied with the value they receive from the
product or service. Being a cement production company with long experience in production of
cement, TPCC has managed to enjoy a greater customer loyalty to their products,

Conclusion

To sum up, environmental scanning is an important aspect of marketing environment since it helps
the firm to analyze its’ potential capabilities, resources and market position compared to its’ rivals
through SWOT analysis. In addition, it helps a firm to set up an appropriate objectives and
strategies that match with the existing Political, economic, socio-cultural, technological and legal
factors that influence marketing programs. Therefore, environment scanning is a very vital tool in
boosting up the company’s performance.

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References;
 http://www.twigacement.com/en
 United Nations (2017), The 2017 Revision of World Population Prospects, Population Division
of the Department of Economic and Social Affairs of the United Nations Secretariat
 National Bureau of Statistics, (2013), 2012 Population and Housing Census, NBS.
 Upadhyay, M. K and Pandey, M (2015), SWOT Analysis of Cement Industries in Chhattisgarh
(Comparison between International brand and Local brand, International Journal of Science,
Engineering and Technology Research (IJSETR), Vol. 4, Issue 10.