Global & International Business Contexts (Chilean wine industry) Essay

Global & International Business Contexts (Chilean wine industry) - Essay Example The highly competitive environment in the telecommunication sector has led to low pricing of the communication services that has reduce the cost of the business infrastructure for companies in Chilean markets (William,  Beaujanot  and  Zuniga, 2010). The administrative infrastructure has also been favourable for quick registrations reduced the time of obtaining licences for the new companies entering the wine industry (Rugman and Collison, 2012). The physical infrastructure in Chile supports the growth of wine industry as the country has high efficient air port and sea port facilities to support the distribution of wine. The government has always encouraged development of skills of the available manpower. This has been advantageous for the Chilean wine industry as the efficiency of the workforce is closely linked to the business output (Wines of Chile, 2013). The weakness of the Chilean conditions lay in the lack of good quality of education at various levels in the education s ystem. The government has been coordinating for laying the infrastructure of proper training and development, specialized training for certain industries like the wine industry to provide favourable business environment for the investors. The wine industry of Chile, however, faces the risk of natural disaster like earthquake, volcanoes, etc. Due to these disasters, the wine industry has faced million dollar losses as a result of the damages on the physical infrastructure like the airports, transport facilities, etc. However, the overall industry environment supports adequate level of production to meet the export requirements of the wine industry. The foreign currency regulation is weak in Chile due to which the wine... The strategies and the rivalry prevailing among the wine producers in the Chilean wine markets are also important for analysing the Chilean wine industry. The level of competition in the Chilean wine industry in quite healthy in nature that has the objective of producing quality wine products for supplying to the customers in domestic and foreign markets (Jenster, Hayes and Smith, 2005). The Chilean wine industry has witnessed strong regional competition among the wine producers. Due to the high prospects and the lucrative business opportunities in the wine industry of Chile, there have been foreign direct investments in this sector. The foreign investors have increased their presence in the Chilean wine industry thereby increasing the competition for the production of good quality of wine at competitive prices. The instances of joint ventures have also been noticed in the wine industry. The joint venture between Err azuriz and Mondavi is an example. Thus the competitive rivalry in t he wine industry has been quite intense which led to the increase in performance of wine production and supply over the years. The areas of weakness of the wine industry are also important to analyse the investment proposal of the new business. The wine industry of Chile lacks in the area of governance among the wine producers and suppliers operating in the market (Visser and Langen, 2006). The wine producers and the suppliers lack mutual trust among each other. The practise of copying the marketing and distribution styles of other players has been observed. The Chilean wine industry has shown signs of regional differentiation.