Month: October 2012

Source: http://www.ctvnews.ca/canada/wine-gaining-ground-with-canadian-drinkers-report-suggests-1.1016819

Report suggests that Wine consumption has increased in the past years. This creates great opportunity for the existing and potential wine producers. On the other hand, the beer producers are threatened by this change in taste.

The main reason for this change seems to be the increase in age of the population. Due to the improvement on medication and technology, people live longer. Also, the younger generations are likely to have less kids. These two factors increase the age of Canadian population. Wine, as contrast to beer, is more liked by the elders.

The increase in age of the population is an opportunity for the current existing wine producing companies. It creates more room for growth. The market is also open to new businesses to increase the production of wine. The wine businesses should get hold of this opportunity and gain greater market share.

Change in taste of costumers is not always as threat to the beer producers. The beer producing companies should work to attract the consumers’ attention in a different way. They should make their product more associated with higher standard of living, and less towards the general young, energetic, and risk-taking image of beers.

Source: http://www.cbc.ca/news/business/story/2012/10/25/nexen-cnooc.html

Nexen, a Calgary-based oil and gas producer, agree upon CNOOC’s takeover deal. This deal is considered as a deal that will gain “net profit” by the Canadian government. However it has been a long time since the agreement is made in the 23rd of July, and the takeover is still in process.

There are many concerns from the Canadian stakeholders. Security is one major concern. As CNOOC is a state owned company, it is possible that  the information of Canadian users being observed by China. As oil and gas are most important materials for production and daily life operation, people may feel uncomfortable for a foreign company to control the production of these goods. There is also a concern towards China’s economy in general. Its unique, fast-growing economy is different from what the Canadians understand and brings uncertainty.  In the other hand, China also is trying hard to understand the slow decision-making speed of the Canadian company.

The companies should work on clarifying the doubts in minds of the Canadian stakeholder, and emphasize on the benefit that this takeover would bring. they should also focus on forming a style of operation that suits both cultures.

Reference: http://www.ctvnews.ca/business/beijing-academic-says-chinese-baffled-by-government-concerns-over-nexen-1.1009915

http://www.theglobeandmail.com/globe-investor/nexen-profit-falls-expects-cnooc-deal-by-year-end/article4650804/

Source: http://www.ctvnews.ca/canada/canadian-housing-sales-up-in-september-but-numbers-down-from-year-ago-1.996064

According to the article, housing sales gone up in the past month. The increase in mortgage return may cause the demand of housing to fall. Housing sale did decrease in the past months, but there is a tendency that it will increase. Housing is a need for people, so the demand for it is inelastic. As the price of housing increases, the firms will likely to have an increase in sale over time.

Under this economic environment, it is likely that some company may try to decrease their price. However, the most important action for housing companies now may not be decreasing the price, but keeping the demand for their housing stable by non-price competition. Companies should use advertisement to specialize their housing. Even though all the housing companies has increased their price due to market force, companies can convince the customers that their housing has kept the price as low as possible. Also they can aim for high income customer group by making their housing appears to be with higher standard.

In an unstable economic environment, companies should set a suitable strategy and try to make themselves a place in the market.

Reference: http://www.ctvnews.ca/business/new-mortgage-rules-cooling-home-sales-canada-wide-report-1.969134