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Marketing Management

Case Analysis of Atlantic Quench Cranberries Inc.

Table of Contents
List of Figures..................................................................................................................................3
Introduction......................................................................................................................................4
Situational Analysis.........................................................................................................................4
Macro Analysis............................................................................................................................4
PESTLE Analysis....................................................................................................................4
Micro Analysis.............................................................................................................................7
Market Growth.........................................................................................................................7
Marketing Objectives.....................................................................................................................10
STP Analysis (Segmentation, Targeting and Positioning).............................................................10
Segmentation.............................................................................................................................11
Customer attitudes/trends.......................................................................................................11
Targeting....................................................................................................................................11
Positioning.................................................................................................................................12
Recommended 4 Ps......................................................................................................................12
Products.....................................................................................................................................13
Price...........................................................................................................................................14
Place...........................................................................................................................................14
Promotion..................................................................................................................................15
Implementation..............................................................................................................................15
Conclusion.....................................................................................................................................17
References......................................................................................................................................19

List of Figures
Figure 1PESTEL Framework..........................................................................................................4
Figure 2 Total EU fruit juice and nectar consumption 1989-2019e................................................8
Figure 5SWOT Analysis..................................................................................................................9
Figure 6STP Model........................................................................................................................10
Figure 74 P's of Marketing............................................................................................................13
Figure 8Product Lines of Atlantic Quench....................................................................................13
Figure 9Implementation Process...................................................................................................16
Figure 10: Product Launch Promotion Strategy............................................................................16
Figure 11KPIs of Atlantic Quench.................................................................................................17

Introduction
The worlds economy is gradually converting towards globalised one. The process has enhanced
companies across the world to exchange their products from one country to another (Mathews,
2006). Though the same market scope has increased yet the vastness has narrowed competition
as now companies deploy their core competencies to acquire worldwide competitive advantages
(Cunningham & Harney, 2012). Atlantic Quench is a corporation offering a variety of products
sourced from their cranberry produce. The scope of the current report is to understand in detail
the position of the enterprise in the UK on the market as well as customers using models like
PESTEL, SWOT and STP analysis. This study laid the foundations for proposing an innovative
marketing plan, based on 4 Ps model.

Situational Analysis
Macro Analysis
PESTLE Analysis
The PESTLE Analysis is the analysis of six key macro-economic factors that have a direct effect
on the strategic decisions made by the firm (Walsh, 2005).

Figure 1PESTEL Framework

Source: (Gill, 2006)


The scope of this section is to analyse the external environmental factors that would affect the
operation of Atlantic Quench in the United Kingdom (the UK).
Political
The UK enjoys a stable political environment with low levels of corporation tax (Bureau of
Economic and Business Affairs, 2013). Such low tax levels enable any firm like Atlantic Quench
to expand at a rapid rate. One of the most important features that might raise Atlantic Quench
market share is lower levels of sugar content in its products. The UK government plans to
impose sugar tax from the year 2018 on products containing more than 8 grammes of sugar in
every 100 millilitres as compared to those having only 5 grammes in every 100 millilitres
(Bourke, 2016). Thus with products lesser that 5 grammes of sugar Atlantic Quench will also
avail monetary benefits.
Further increases consumers spending capability, as it boosts the overall economic activity.
However, the entire world is affected from by economic turmoil and refugee crisis which raises
concern regarding sustaining such levels of taxes even in the UK. The UK enjoys a system of
parliamentary democracy hence a relatively low-risk political environment to function for any
company (Dai & Norton, 2013). Thus these are considered as aspects of positive scenario for
Atlantic Quench for operating in the UK as compared to other countries.

Economic
The economic environment of the UK has been in a state of turmoil since the year 2007 due to
the global financial crisis. GDP has been contracting with a negative 1% growth following the
mayhem with a worst in 2009 being negative 4%, but the country has been ever since recovering
(Trading Economics, 2016). Further analysis of unemployment and household disposable income
data reveals negative patterns. The trend has been gradually recuperating as the country is seeing
an upsurge in consumer spending. The current lending rate in the UK is 0.5% which is an alltime low figure, considered a detrimental factor for firms wanting to borrow money and grow
(BBC News, 2016). Expansion of supermarkets chains in the country will further add sales for
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the company products, as it offers its juices and other products in biggest retail stores. This is a
crucial data for businesses like Atlantic Quench, who are eyeing significant share of profits from
the country.
Socio-Cultural
The country is facing a high amount of transition in socio-cultural platforms that is beneficial for
the company. The trend towards healthy snacking and eating is on a steady rise as meal times
gradually reduce. Further making fruits mandatory in schools has taken chips, chocolates of
shelves and introduced juices instead (Raulio et al., 2010). Hence this is a positive factor for the
company like Atlantic Quench, who is planning to expand market and market operations in the
country.
Technological
The technological developments in the UK have boomed the state of the current business
environment in the country. Rise and spread of use of the internet, broadband facilities have
surged retail stores where consumers can purchase most products online (Doherty & EllisChadwick, 2009). The development of smartphones and apps has further allowed customers
with easy access to goods (Boulos et al., 2011). These factors have further added to the business
development of Atlantic Quench as the company will be able to host its website to reach its
customers and provide them options to buy online thus minimising distribution costs. Further,
these mechanisms will provide for promotions on social media platforms in a practical and costeffective manner.
Legal
The UK has a stable jurisdiction system with some legislation like Minimum wage legislation,
which provides that a company pay a minimum of GBP 6.19 to per hour its employees above the
age of 21 (Government of UK, 2016). The other legislative issues are laws designed to provide
equality for men and women at workplace and in recruitment and selection processes. Norms of
these types often impose challenges on companies like Atlantic Quench for the development of
their human resources rules.
Environmental
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The current environment in the UK is providing a threat to major food and juices companies due
to its concurrent flooding. Losses incurred in flooding are massive and destroys stock of juices
and packed food (Kron, 2011). The other environmental factors in the UK are reducing waste,
reducing carbon footprints and kerbing environmental pollution; these norms are required to
adhered by Atlantic Quench.

Micro Analysis
Market Growth
The market for juice and healthy snacking is escalating ever since in the UK with several
companies offering multiple products. The demand for fruit juice in the UK is very high as
British people get more health and lifestyle conscious. Due to the tie-ups with largest chains of
supermarkets in the region, there is also an enormous amount of impulse buying that takes place
(Mohan et al., 2013).
However, with the campaigns regarding carbonates and sugars present in juices has induced
regulators to reduce fruit juice in English schools to 150ml a day (Renton, 2013; Tedstone et al.,
2014). Regular consumers are cutting down the fruit juices consumption to five days due to
which Tropicana UK lost almost a 10% share in 2015 though having the highest market share
(Euromonitor International, 2016). The forecast for juice market continues to be negative with
declining sales value. The producers have to reform their offerings as companies continue to
innovate and offer a low-calorie substitute.

Figure 2 Total EU fruit juice and nectar consumption 1989-2019e

Source: (AIJN, 2014)


With a robust population and high affinity towards health, the market for fruit juices will
continue to bloom and flourish if appropriate marketing strategies adopted along with offering
the right products. Tropicana and other private label brands from Tesco and others offer fierce
competition to Atlantic Quench (Euromonitor International, 2016). The mature retail markets in
the UK with supermarkets offer high potential for these consumables (UK Trade and Investment,
2014). Further, the scarcity of time to prepare healthy alternatives is further forcing the sales up.
The trend to drink juices at breakfast and eat fruit snack bars during breaks is also rising (AIJN,
2014).

SWOT Analysis
A detailed analysis of the strength, weakness, opportunity and threat of Atlantic Quench for
business sustainability and viability undertaken in this section (Bhm, 2009).
Strength

Products

Weaknesses
naturally

obtained

by

macerating fruits like cranberries. Do

not contain carbonated additives.


The products contain fructose and are

refreshing health drinks.


The company offers products that not

Carbonated sweetened beverages offer

the company fierce competition.


The rising costs of cultivation and

prices of fruits.
Rising competition hence decreasing
market share with similar category

only provide health benefits but also

juices and dried fruit products.

snacking.
A well-known brand with huge market
presence. The company has an active
image with the customers.

Opportunity

Innovative products with fruit juices,

Product

diversity

of

carbonated

like mixed fruit juices and cranberries

products and customer preferences for

bars (Raulio et al., 2010).


Marketing initiative by

such products.
Reduced production of cranberries and

customer

Threats

awareness

creating

regarding

the

grapefruits, hence lower production of

benefits of cranberries and grapefruits.


Increase market share by tie-ups with

juices and consecutively small market

retailers and online portals.

share.
Profit share of carbonated beverages
higher as compared to juices for
retailers (Sanger-Katz, 2015).

Figure 3SWOT Analysis

Source: (Mello, 2010)


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Marketing Objectives
The marketing objectives that would achieve through appropriate targeting and positioning has
been determined with the help of SMART Model (Solomon et al., 2012).

The primary market objective is to gain 3% share of the UK market regarding sales along

with the achievement of breakeven within first two years of operations.


Atlantic Quench proposes to create brand awareness among 50% target audience as a
health drink through extensive promotions and competitive pricing through right

positioning strategy.
Atlantic Quench plans the objective to achieve an 80% customer renewal rate by the end
of the current fiscal year by providing quality and healthy drink along with customer

support and relationship building.


Atlantic Quench proposes to complete product development projects by the end of 2016
fiscal year and add two additional flavours to the juice drink product line.

The achievements will be reviewed quarterly to ensure they can achieve in reality. The objectives
would accomplish within one year.

STP Analysis (Segmentation, Targeting and Positioning)


The STP Model depicted in figure below:

Figure 4STP Model

Source: (McCabe, 2010)

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Segmentation
For determining the appropriate segment for right targeting, it is important to understand the
customer attitudes and market growth.
Customer attitudes/trends
The client's segment Atlantic Quench is trying to target in the UK is of various types. Cranberry
is known to provide nutrients and antioxidant properties (Ruel & Couillard, 2007). The rise in
consciousness about health amongst British people has opened up newer opportunities for juice
marketing in the region which will be the primary consumer segment for Atlantic Quench
(Leichter, 2014). Further, a surge in demand for low-calorie drinks in the market and dried fruit
snacks has been experienced approximately 57% of the total soft drinks consumed belong to low
or no calorie category providing for substantial market segments to Atlantic Quench (British Soft
Drinks Association, 2015; Bord Bia, 2014). The consumers are aware of the several health
benefits offered by the cranberry juices and snacks, so they would prefer this product over fast
food joint products. Also with the company can focus on lower and middle-income segments for
its products. Thus two major parts that Atlantic Quench will target are based on demographics of
people and lifestyle which elaborated in the section below.

Targeting
The products offered by Atlantic Quench through Geber in the UK are a wide variety of
cranberry and mixed fruit juices along with snack bars. The developed nations in the world are
gradually becoming extremely health conscious and aware of the various benefits of fresh fruit
(Leichter, 2014). The company aims its products across all ages of customers and different
categories. The segment of customer the company is targeting is:
Demographic Segmentation: For the purpose of forming a target market segmentation is
deemed necessary for children in the age group 5-12 years, adult in the age group 15-55 years.
The entire portion of the UK population that falls under the category is 18% of the age group 014 (Index Mundi, 2014). The adult age group includes office goers, college goers, and
homemakers and so on. Further income based segmentation was done. The price of the product is
kept small such that middle class and lower class people can easily purchase it. The product has
become a regular item in every household in the UK; there are small packs and another variant
packaging available such that anyone can afford it.
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Lifestyle Segmentation: The product is primarily aimed at a portion of the population that is
health conscious. These people follow the regular dietary intake of fruits and vegetables. They
regularly consume juices which offer the biggest market for the juice makers and marketing
companies. The diet juices or low-calorie juices are also best suited for a diabetic portion of the
population who can consume these for the vitamins intake alongside regulate sugar content.

Positioning
The main highlights of Atlantic Quench products are the cranberries that it uses to produce its
product, have high antioxidant properties and health benefits. The snack bar which is derived
from the cranberry also offers similar benefits of the fruit itself. The cranberry juice is said to be
unique in its properties and is also good to taste. Therefore, the positioning strategy of the
company is based upon the following parameters:

Unique due to home grew cranberries that provide for health benefits along with taste
Tasty to drink juices and cereals and liked by everyone across all ages
Made from freshly sourced high-quality cranberry
Source of high fibre and high in vitamins with huge antioxidant properties
Healthy and low calories apt for those suffering from diabetes and other diseases

The company would campaign an entire range of products across various ranges of customers
(Holm, 2006). The company also would offer some custom made products which are low in
dietary sugars. There are also several specialised products provided by the firm that has a high
appeal amongst customers in the UK.

Recommended 4 Ps
Atlantic Quench has a licensed agreement with Gerber in the UK to distribute its products and
juices. Atlantic Quench also has three contracts with three largest supermarket groups in the UK
to sell its product lines. The company had USD 1.7 billion sales in the year 2007 which has been
doubling since then. The blended juice that the firm offers is said to have better health benefits
and has attracted a huge customer base.

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Figure 54 P's of Marketing

Source: (Sarin, 2013)

Products
The customers in the UK can be seen to be highly health conscious with an urge to eat healthily.
The company offers various categories and types of products which would have immense charm
amongst the customers. Customers are always in search of innovative products that provide the
best of value and benefits (Rintamki et al., 2007). The increasing awareness regarding dietary
added sugars in carbonated and fruit juices have further pushed companies into making products
with lesser calorie values which is also recommended to Atlantic Quench.

Juice
(Product line
No. 1)

Low-calorie cranberry drinks


White cranberry juice
Ready-to-drink mixed
flavoured juices

Snacks
(Product Line
No. 2)

Crantanas (the dried fruit)


Chocolate-covered Crantanas

Energy Drinks
(Product Line
No: 3)

Cranzeal

Figure 6Product Lines of Atlantic Quench

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Source: Author
Fruit juices have high fructose content hence they tend to have a sweetened taste, which is
avoided by many who are health conscious. There is also a fierce competition amongst sellers
offering fruit, vegetable juices and snack bars as to who can provide the best quality at the lowest
possible price. Customers in this market are also in the outlook for more varied fruit offerings
and vitamin supplements that are formed from cranberries which can be exploited by Atlantic
Quench.
Further along with making packaging attractive and informative, it is also advisable to Atlantic
Quench to resort to can packaging.

Price
The UK market is filled with several global companies and local private label brands offering
juices and fruit derived products. The average price of a litre juice pack of cranberry fruit is 2
GBP; hence companies need to set their prices at that range. But with cranberries produce
varying the cost sometimes overrun the price. Prices are fixed based on market understanding.
Further, this price fixation is done before a stock delivery, but the most competitive the price is,
the better it is. Based on market understanding Atlantic Quench also needs to offer a competitive
price in the UK which is recommended in this case (Nagle et al., 2006). It also needs to consider
that the price offered by Tesco and other companies are lowest in the market. Their wholesale
trade and own private label brands give them the comfort to offer at a price lower than the
market. So, the cost to satisfy customers needs is to be decided considering all such factors.

Place
Consumers in the UK shop significant portions of their grocery and daily need products from
supermarkets. A major part of customers also buys online their daily requirements from various
e-commerce portals (Huang & Oppewal, 2006). Thus a company like Atlantic Quench planning
to sell its products has to make their products available at the major supermarkets like Tesco,
Waitrose and other Shops. These shops will not only offer higher visibility of the companys
products but will also increase the chances of its product getting sold. The company also has to
enlist its products and make them available at online portals by ensuring a proper value chain
process. The more places the products will be available the more will be the sales for its
products.
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Promotion
The company has to make consumers aware of the various product offerings that it has through
various communicative processes. There are multiple marketing awareness procedures and
advertisement techniques available nowadays which companies resort to. The most popular
methods include television advertisement, hoardings, word of mouth, and public relation
building and so on (Holm, 2006). The company has an agreement with Gerber hence Gerber
itself does the sales process. Geber has a huge presence in the UK markets hence it becomes
relatively easy to sell its products. Further online marketing by making an appearance on
differing social media websites and other portals would provide for added visibility of Atlantic
Quench (Heymann-Reder, 2012).

Implementation
Once the strategic approach in the form of recommendations has been identified the next crucial
step is to implement the same to achieve the marketing objectives successfully (Ferrell &
Hartline, 2014). The implementation will be done through a procedural approach will be adopted
as depicted in figure below:

Communicating
and Preparing
Employees

Execution of
Plan

Continuous
Monitoring

Implementation
of reviewed
plan

Taking
Corrective
Actions

Figure 7Implementation Process

Source: Author
15

Firstly, the organisational employees will be communicated about organisational objectives and
hence they will be prepared for its execution. This will involve resolving queries, determining
key roles and tasks, overcoming objections and providing training if required. Once the
employees are all prepared to execute the plan the next is a step taken by Atlantic Quench would
be to ensure that the program is implemented as developed and the progress is continuously
monitored (Beamish & Ashford, 2006). It is during this period that marketing team works in a
dedicated and focused manner to ensure that the strategies are rightly applied thereby assisting
Atlantic Quench to achieve its objectives. The product will be launched based on following
launch program as determined in table below:
Product Launch Marketing
Campaign
Traditional Techniques

Communication Approach

Primary Target

Television
Hoardings
Word-of-Mouth
Public Relations (organisation
of

events

and

sponsoring

football matches)

Middle
and Lower
Income

Groups
Age
groupto

5
12

years and
15-55

years
Health
Conscious

Modern Techniques

Own Website
Social Media Marketing (Pages

and office

on Facebook, Twitter Account,


Promotional

Videos

YouTube)

on

people
College

goers
Age
group- 15
years and
above

Figure 8: Product Launch Promotion Strategy

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Source: Author
The purpose of continually monitoring the implementation progress is to determine adjustments
if any that is to be made to fill up the gap between actual environment and planning period so
that marketing objectives are adequately met (Ferrell & Hartline, 2014). This monitoring will be
done based on Key Performance Indicators (KPI) within specified timeframes are identified in
figure below:

Review of no deviation in money of


planned budget of project within 1st year

3. KPI
(Efficiency)

15% target audience aware about


products in 1st 3 months
Zero Time gp between demand for
products and its supply in 6 months

2. KPI
(Business
Process)

Achievement of breakeven in 1st year


10% revenue inchsrease within 6 month

1. KPI
(Revenue)

Figure 9KPIs of Atlantic Quench

Source: (Parmenter, 2007)


It is necessary for the marketing plan and the implementation process to be flexible to
accommodate changes and thus be successful. By developing a responsive marketing plan,
Atlantic Quench will be in a position to fine-tune its strategic approach as per changing
environmental factors.

Conclusion
The company analysis and market condition studies have been incorporated in details in the
report. The report reflects that though the company has a relatively good share in the market
amongst fruit juices yet it has to innovate more products to sustain in the long run. The essence
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of attaining customer satisfaction in this type of market is to keep surprising the customers,
which will amplify customer delight thus augment their loyalty. The company has a bright future
ahead with lots of opportunities in the UK market if it pursues the right strategies as identified in
analysis and proposed recommendations above. The company can further penetrate the market
and reach out to multiple customers by strategic marketing thus gaining long run sustainability.

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