Political: turning away from soft drinks towards healthier

Political:Taxesincrease the cost of sales, meaning businesses will have to raise their prices. The more expensive the product, the lesslikely consumers are to buy it.  However,current health trends in Ireland will benefit Vithit with the introduction ofsugar taxes in 2018, “The tax will apply at a rate of 30 cent per litre ifdrinks have over 8g of sugar per 100ml while 20 cents per litre tax will applyif drinks have between 5g and 8g of sugar per 100ml.

Drinks with less than 5gof sugar will not be taxed” (Pope, 2017).  Vithit lean & green has 1.3g of sugar per100ml (O’Connor, 2017) while 7up has 11.

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2g per 100ml (Kenny, 2012).  Vithit isn’t being taxed unlike itscompetitors.  Consumers are turning awayfrom soft drinks towards healthier alternatives, leading to greater sales for Vithit. Economic:Vithitmust be aware that sales can fluctuate during economic downturn and boom times.In a bad economy, consumers have less money to spend on discretionary items,meaning sales for luxury products like Vithit fall.  Being an expensive product makes it sensitiveto price change.  However, with therecent economic upturn, consumers have more money to spend, leading to anincrease in Vithit’s sales.

  Profits increaseif the euro is weak as the product is exported to sixteen foreign markets(Blair-White et al 2017).  They mustconsider international trade, import tax, exchange rates and foreign economies,which influence the price Vithit sells their products.  The use of aseptic filling means less plasticis required for bottling, cutting costs.  Securing finance is difficult, Vithit is smalland could pose a risk, so they turned to alternative sources like peer-to-peerloans from linked finance.Social:Ireland is very health conscious, after risking becomingthe most obese country in Europe within the next decade (Cullen, 2016).  People are making lifestyle changes to behealthier. At the time of Vithit’s establishment, “colas and sports drinkscontained 20-28g of sugar, yet the recommended daily total sugar intake perperson is only 25g” (Blair-White et al 2017), so Gary Lavin decided to develop ahealthier alternative.  Using asepticfilling ensures all added vitamins and benefits survive but the product issterilised, this appeals to parents looking for alternatives to sugary drinksfor their children.

  They “worked theiryouthful, fun brand image into witty advertising slogans and self-deprecatinghumour featured on their bottles” (Blair-White et al 2017) using “punny”product names, including ‘immunitea’ and ‘vitalitea.’  Vithit considers what consumers want, switchingto wider bottles in Ireland and slim cans in South Africa.  Technological:Vithit must consider its machines, do they need to beupgraded?  Are they as efficient as theycould be or as their competitors?  Theymust consider these questions when budgeting. Occasionally they will need to upgrade their machines which will beexpensive but in the long run the efficiency will enable them to save money,cut costs and make redundancies, allowing them to reduce their price andincrease sales.

  Regarding advertising, beingthe main sponsor of ‘Masterchef’ is good brand exposure along with a blog,Facebook, Instagram and twitter pages, to interact with its consumers “socialmedia has become a key means of engaging with its younger consumers”(Blair-White et al 2017).  This lets themsee what consumers are looking for and appeals to the younger market throughwitty posts on a platform they will see and enjoy. Environmental:Because Vithit is a health drink containing fruitjuices, they need good quality fruits harvested from a clean environment.  Other ingredients include water; therefore, itis in their interests to source a clean water supply, this will affectcompetitors as well as themselves.  Vithitsells its product in a recyclable plastic bottle, which helps with advertisingas they can show themselves to be a green company who cares about theenvironment.  The business’ use ofaseptic filling has environmental benefits as well as social as it removes theneed to heat the drink, allowing for thinner plastic used for the bottles.  Although Vithit seems to be veryenvironmentally conscious, like any business, they must make a conscious effortto reduce their factory fumes, reduce their carbon footprint and obey environmentallegislation.  Legal:Vithit must obey the law of the country they areselling in, for example Sale of Goods and Supply of Services Act 1980 inIreland or the Consumer Protection from Unfair Trading Regulations (Jackson,2017) in the UK.

 Their products must beof merchantable quality and they must include specified information on theirpackaging, such as ingredients and any necessary warnings.  There are many food regulators in place inIreland by the Food Safety Authority to ensure products are not harmful andconsumers know what they are buying.  When Vithit expanded to the US they wereforced to remove L-cartinine from their products “which is not permitted inliquid products in the US” (Blair-White et al 2017).  Vithit also reformulated their product to haveless vitamins for exporting to Nordic countries due to the lower vitamin RDAsthere.