Aquastructures: Canadian market analysis

Abstract

The following report has been completed on behalf of Aquastructures AS, a newly established Norwegian company operating within the engineering sector, to analyze a possible expansion to the market of British Columbia, Canada. Within the company’s various segments of expertise, the aquaculture segment has been the focus of this report. This includes a full service range of computer simulation and certification of open water fish farms. The company has developed a uniquely advanced technology enabling accurate and up-to-date simulation of forces acting on these marine structures. The introduction phase of the report discusses the company’s background, the developed research problem, and the identified research objectives. The object is to determine which factors will prove crucial to the completion of the report, within the stated limitations. The report combines literature review with academic marketing theories to evaluate market opportunities and the company’s preparedness for the proposed Canadian expansion. Further, industry related issues such as political climate and involvement of environmental groups are identified, and their relevance is analyzed and evaluated. The report continues by providing a strategic problem definition, as well as specific short and long term goals as a basis for further strategic development. Research Methodology In order to obtain knowledge of the research topic, exploratory research has been conducted based on primary and secondary sources. As part of the primary exploratory research, interviews were carried out with key personnel related to the aquaculture industry including the Ministry of Agriculture & Land, dominant fish farming companies, environmental nongovernment organizations (ENGOs), the Consulting Engineers of British Columbia, as well as industry academics. Secondary sources have been used as a main source of insight and knowledge to provide both an overall and in-depth perspective of the aquaculture industry and any related issues, as well iv as the Canadian market as a whole. The secondary research primarily includes information obtained through electronics sources, as well as media and academic reports. Secondary sources have also been used to obtain descriptive research information relating to the topic at hand. Summary of findings Findings from the primary and secondary data collected show that the fish farming industry in British Columbia is dominated by a few large companies which are fully or partially Norwegian owned. There are no present companies in Canada offering the same complete service package as Aquastructures. The certification of the fish farms relies heavily on past experience, and the aquaculture industry is in lack of a standardised certification system. Current legislative vagueness provides few guidelines for inspections methods and inherent adequacy of the controls. Environmental non-governmental organizations (ENGOs) are constantly fighting for stronger regulations regarding fish farming, including drastic improvements on containments used, such as closed containments. The fish farming is regarded as a highly sensitive topic in BC, and must be accounted for in spite of no direct effect on Aquastructures potential sales. There is currently a market trend in which customers are demanding full traceability and environmental certification. Canadian fish farmers want to be in the forefront of sustainable aquaculture to meet these expectations. Due to regulatory requirements, as well as the need to accommodate specific local requirements, the necessity of a local representative was examined. This has not only been considered as a long term strategy, but also as a potential entry mode. Both traditional less resource demanding cooperation strategies, as well as the more complex strategic alliance approach, have been explored. The latter of the two has been found to be the most desirable, as it enables the goal for a long term international strategy, and can therefore be used as a platform for further expansion. v The report also provides criteria on the type of characteristics a future partner should posses, in order to provide benefits in terms of overall cooperation and a mutual exchange of valuable industry knowledge. Recommendations In order for Aquastructures to succeed with the proposed strategy, several key issues will require further attention. The following is the recommended course of action: Ø Conduct further research and explore potentially suited partners, to increase the chances of a successful Canadian expansion for Aquastructures. Ø Participate in developing new viable and environmentally sound solutions. Ø Participate in trade fairs/shows to efficiently build strategic relationships, and promote future sales. Ø Pursue different options in terms of environmental organizations and potential partners. Through cooperation Aquaculture may be able to participate in creating a larger market for the company. Ø Further develop the existing website. The international versions of the site should equal the Norwegian version in terms of content and professionalism.