North South University

SBE, Department of Marketing and International Business

International Business

Course Code: INB372

Semester: Summer2020

MIDTERM

(To BE ATTENDED BY ALL STUDENTS)

Name: md. Ahanaf thamid

ID:1912820630 Roll:34 Sec:14

Faculty:_tfz_____________________________________ Date: _____15 aug_________

TOTAL MARKS - 30

Marks obtained:

(This space is for faculty’s usage. Do not write here.)

INSTRUCTIONS:
[NOTE: Students needs to be assigned different companies in different markets, and based on that they
will run the following analysis]
Introduction:

British American Tobacco Well knows as (BAT) is a British multinational company It

manufactures and sells cigarettes, tobacco and other nicotine-based products. British American
Tobacco established in 1902, is headquartered in London, England. As of 2019, it is the largest
cigarette maker in the world based on net sales. It is a joint investment between the UK's
imperial Tobacco Company and the American Tobacco Company founded by James Buchanan
Duke the first chairman.

In Bangladesh: British America tobacco Bangladesh ( BATS) in one of the largest multinational
companies. It is doing its business over 100 years in this sector. It was established in Bangladesh
in 1910. It had established its first depot at Armanitola in Dhaka. After the independence of
Bangladesh from Pakistan, it was renamed as Bangladesh Tobacco Company (BTC) in 1972. But
in 1998, it is freshly renamed as British American Tobacco Bangladesh (BATB)
 Parent country: British America tobacco ( BAT)

British American Tobacco Bangladesh is the company in concern that can produce a product like
the British American Tobacco group.

Product and Services in Bangladesh:

Premium- Benson and hedges price :15 to 18 tk

High- Gold Leaf, Pall Mall , capstan price :10 to 12 tk

Medium- Star , scissors price: 7 to 8 tk

Low- Bristol , Hollywood, Pilot price : 5tk

 Geographic location:

British American Tobacco Bangladesh main headquarters in Mohakhali, Dhaka.

Tobacco supplier in Khulna, kushtia and Savar union

Marketing agency in Dhaka

Corporate office in Gulshan Centre Point , Dhaka

 History

Bangladesh is a 3rd manufacturer of tobacco for (BAT). They are placed on the stock index of
the Dhaka Stock Exchange and Chittagong Stock Exchange. It is doing its business over 100
years in this region. It was founded in Bangladesh in 1910. It had established its first depot at
Armanitola in Dhaka. After partition in 1947, it was established in 1949. After the independence
of Bangladesh from Pakistan, it was renamed as Bangladesh Tobacco Company (BTC) in 1972.
But in 1998, it is again renamed as British American Tobacco Bangladesh (BATB). In
Bangladesh, British American Tobacco Bangladesh has more than 1,200 people as direct
employees and more than 50,000 people as indirect employees (mostly farmers).

British American Tobacco Bangladesh's motto is "success and responsibility go together".

Shehzad Munim is the current managing director of BATB. He is serving as the first-ever
Bangladeshi MD in the history of BATB. First companies to be listed on the Dhaka and
Chattogram Stock Exchanges and currently ranked amongst the top 10 companies in terms of
market capitalization. British American Tobacco Group holds 72.91% of our shares.

Globalization of market :

Globalization of markets refers to the process of combining and merging of the distinct world
markets into a single market. This method includes the identification of some common measure,
value, taste, choose convenience and slowly allows the cultural shift towards the use of common
product or service .

Example: BAT's failure in the Turkish market was due to a confusing investment strategy
focused only on getting TEKEL and is compared with Philip Morris success in Turkey despite
both TTCs working within Turkey's unstable and corrupt investing climate. On the other hand
globalization of marketing gives success in other countries like Bangladesh, Vietnam, India
Pakistan, China they successfully Run their business of globalization of the market.

Globalization of production:

Globalization of production refers to the "sourcing of goods and services from locations around the
globe to take advantage of state variances in the cost and quality of parts of production like labor, land,
and capital"

Because of the globalization of production the British American tobacco, it is quickly produced
so much cigarette in Bangladesh. Because of the low-labor cost and land cost. During this low
cost, Bangladesh is an ideal place for manufacturing (BAT) product and the soil is very fertile of
Bangladesh. So, they can easily grown tobacco leaf in Bangladeshi land so it creates a huge
quantity of tobacco leaf per year. Multinational company like British American tobacco always
search for this kind of low-cost countries like Bangladesh.

Example:

A standard cigarette has four basic components:

1. Tobacco rod

2. Cigarette paper

3. Tipping paper

4. Filter

For making a cigarette four basic components is needed. but a can't like Bangladesh cant provide
the four elements. So, they provide the labor, land and Tobacco rod those are known as tobacco
leaf. BATB cigarette paper used to come to Japan. Tipping paper usually comes from the UK.
filter always come from China cause China can easily produce filter in a low-cost. because of the
globalizations of production company like bat take the lowest and the cheapest price product
around the world .than BATB produce cigarettes and the launching machines came from china,
Because of low price and good quality.

Political environment:
Government activities which affect the actions of a company or business. These actions may be
on a local, regional, national or global level. Business owners and managers pay close attention
to the political environment to measure how government actions will affect their company.

political standing:

Bangladesh was one of the first countries both to contract and to confirm the WHO Framework
Convention on Tobacco Control. Prime Minister Sheikh Hasina in 2016 pledged the duty of her
government to work towards full compliance with the WHO FCTC and stated that overhauling
tobacco taxation was high on the agenda as the most powerful measure for reducing tobacco use.
Bangladesh aims to be tobacco-free by 2040.the tobacco-based company cant use any vehicles or
TBC adds for their product promotion. If they do they have to give a huge amount of fee to the
government.

The cost:

The cost of tobacco is enormous more than thousands of people died because of the tobacco.
according to the National Cancer Institute, the average cost of a packet of cigarettes is around $7,
which means a pack-a-day habit sets you back $190per month or $2,400er years.

Risk:

(BATB) dealing with the product which has many issues in the market. They can not promote
their product using media or vehicles. They had to pay a huge amount of taxes because of the
tobacco this product every year it's continuously changing. I couldn’t find a stable market for it,
it has demand but it is not socially acceptable business.

Opportunities:

Among the sales of all tobacco product, 60% is Bidi and 40% Cigarette. But with the up-
gradation of purchasing power and economic condition of Bangladesh migration form bidi to
cigarette is also expected in 2020.

market is offering:

British American Tobacco Bangladesh offering the best quality of tobacco with the 95% or less
harmful ingredients than other a company's. It is a better option than other brands in Bangladesh
They also do CSR activities for the people of Bangladesh that create a positive impact on their
band.

Economic environment:
economic environment refers to all the visible economic factors that influence buying habits of
consumers and businesses and hence affect the production of a company.

Economic standing:

The economy of Bangladesh is a developing market economy. It's the 39th largest in the world in
simple terms, and 30th largest by buying power equality; it is ranked among the Next Eleven
emerging market middle income economies and a frontier market. In the first part of 2019,
Bangladesh's was the world's7th fastest-growing economy with a rate of 7.3% real GDP annual
growth. Investing in this country create a great option.
The cost :

 35% of all adults (age 15+) use any tobacco products (men 46.0%; women 25.%).1
 18% smoke tobacco (men 36%; women 0.8%)
 20.6% of adults use smokeless tobacco (men 16.2%; women 24.8%)
 Bidis are cheaper, handmade cigarettes that are popular among the poor in Bangladesh.
Over a quarter of Bangladeshi adult smokers (5.0% of adults overall) consume bidis.1
 Among youth (ages 13–15), 6.9% use tobacco in any form (boys 9.2%; girls 2.8%).2
tobacco helps to grow the. economic but it destroying the countries people health and
relationships.

Risk:

1. Due to the cultivation of tobacco products, the fertility of the land is lost

2. Our main food production is disrupted as a result of excessive tobacco cultivation

3. A survey has shown that in 2018 about one lakh 8 thousand people died due to this smoking
problem in Bangladesh.

4. The local companies can't compete with them because of these multinational companies.

5.Medical cost will more increase

Opportunities:

1. Low Labor and Land Cost.

2. Easily Manufacturing the Product.

3. Easy to Produces in Lowest Cost.

4. fertile land

5. easy trading system

Legal environment:

The laws which are established by the government for trade operation is called legal
environment..

legal standing

1. antitrust laws

2. employment laws
 3. consumer protection laws

4. copyrights and patent laws

the cost :

cost is commonly used in professional solutions like legal services and consultancy juices. High-
low fees mean the custom of offering goods at top dollar for some time, followed by offering the
very same merchandise at a very low price for that predetermined second.

Risk:

Politico-Legal Environment Political risk Occurs due to issues or actions by host governments

•Loss of assets

• Loss of earning power

• Loss of managerial control

Government takeovers - Acts of violence Government takeovers Tariffs, quotas, taxes.

Terrorism, political instability - Laws, regulations

Opportunities:

1. can fill copyright issue

2.can fill against the government

3.use legal robotic by government

4. use the country assets legally

Cultural Environment.:

The behavior’s standards, and values that people use to get and explain their physical and social
environment..

standing:

Material culture. ...

Cultural preferences. ...

Languages. ...

Education. ...
Religion. ...

Ethics and values. ...

Social organization. ...

Product or service potential

Risk :

1.not acceptting the product.

2 . not buying the product

3. regions issues

4. social issues

5. not promoting the product openly

Opportunities:

Bangladesh has a rich, diverse culture. Its deeply rooted heritage is thoroughly reflected in its
architecture, dance, literature, music, painting and clothing. The three primary religions of
Bangladesh (Hinduism, Buddhism and Islam) have had a great impact on its culture and history
tour them company easily push anything to the country.

The cost :

Cultural cost can be happened by promoting the other country cultural this to Bangladesh. It is
not a good thing for a country to lose their own culture.

CONCLUSION

BATB has placed value addition in every stage of the supply chain. BATB is a company with
world, products, system and process. BATB is a leading company in the cigarette industry in
Bangladesh with a market share of more than 50% and employee more than1500eople directly
and they provide indirect employment to more than 60,000 people as farmers, Distributors and
local suppliers. The way BATB operating their business world enables them to be the market
leader for a long period. they have to focus on their CSR effective in Bangladesh to become the
trusted name of this country.
Referent:

https://www.robi.com.bd/en/corporate/media-room/press-release/robi-and-british-american-
tobacco-bangladesh-company-limited-sign-corporate-agreement?gclid=EAIaIQobChMIke2Zq-
ad6wIVC38rCh2BcQp7EAAYASAAEgJWVfD_BwE

http://www.batbangladesh.com/

https://www.bat.com/group/sites/UK__9D9KCY.nsf/vwPagesWebLive/DO9FCN4X

https://www.slideshare.net/rajworlddhaka/british-american-tobacco-bangladesh-batb

https://www.assignmentpoint.com/business/international-business/report-on-british-american-
tobacco-bangladesh-co-limited-part-1.html