Question

Plagirism is Strictly Prohibited Customer is boss of the market and has unlimited need, wants and desires Business environment is affected by some of factors which we should be taken in our Considerations in order to satisfying customers' needs You are required to (from your study of marketing) answer the following? Introduction 1. Write about Industry background of any product in UAE? (200 words) 2. Proposed business/product ( Why did you choose this product ? justify) (300 words) 3. Segment your market into subsets (market segmentation) (300 words) 4. SWOT (Determine SWOT elements related with your product) (300 words) 5. Business Environment (Talk about factors may effect on your Business).(300 words)

Please plagirism is prohibited. Kindly give a unique answer step by step

Answer 1

Product - Crude Oil

Industry background - Oil was first discovered in the United Arab Emirates in 1958, at the Murban Bab Oil Field, following an extensive 30-year search.

In the early 1930s the first oil company teams conducted geological surveys in the UAE. Almost thirty short years later, in 1962, the first cargo of crude oil was exported from Abu Dhabi. With the economy steadily progressing, HH Sheikh Zayed bin Sultan Al Nahyan was chosen as the Ruler of Abu Dhabi in 1966. Under Sheikh Zayed, the steady oil revenues resulted in an infrastructure overhaul with the construction of schools, housing, hospitals and roads throughout Abu Dhabi.

One of Sheikh Zayed’s early actions was to increase contributions to the Trucial States Development Fund, with Abu Dhabi becoming the Fund’s largest donor. Meanwhile HH Sheikh Rashid bin Saeed Al Maktoum, de facto Ruler of Dubai since 1939, replaced pearling revenues by becoming a part of the shipping industry. And, in 1969 as the Emirate of Dubai began exporting oil, Sheikh Rashid focused his attention on developing programs aimed at improving the quality of life of his people with the new oil revenues. In 1968, with the British announcement of its withdrawal from the Arabian Gulf, Sheikh Zayed stepped into action to quickly establish closer ties among the Emirates. Together with Sheikh Rashid, Sheikh Zayed called for a federation that would include not only the seven Emirates that together made up the Trucial States, but also Qatar and Bahrain.

An agreement was reached between the rulers of six of the Emirates (Abu Dhabi, Dubai, Sharjah, Umm al-Quwain, Fujairah and Ajman), and the federation to be known as the United Arab Emirates was formally established on 2 December 1971. The seventh Emirate, Ra’s al-Khaimah, acceded to the new federation the following year.

Since the formation of the union, the seven Emirates have forged a distinct national identity. The UAE’s political system has been designed to ensure the country’s heritage is maintained, adapted and preserved by combining tradition with a modern administrative structure.

Proposed business and product

The UAE is famous for the export of the crude oil and have the largest refinery of the crude oil. The industrial companies related to the product are dominant and too matured to elaborate the components of its product. The early phase of the UAE they had started the research and production of crude oil.

The UAE economy is majorly depends on the exports of this product. It had caused the rapid growth in the economy. Throughout the 25 years UAE has become the a country with one of the highest living standards. Today, every fifth citizen of the United Arab Emirates is a millionaire..Government grants to the newlyweds 100 000 dollars for wedding and for each birth women are paid 20 thousand dollars and in addition land is allocated.

Due to profits from oil exports transport network has greatly improved in Dubai. Today the UAE may be proud of perfectly smooth roads, modern international airports and seaports. Development of oil industry in the country has also attracted foreign labor force - the proportion of foreigners in the country is more than two thirds of the total population. Huge investments are made in the construction sector and tourism - Dubai is famous for luxury hotels, restaurants, shopping centers. Also investment activity in the UAE is aimed at development of agriculture and various factories and enterprises, including power, which provides fresh water not only for the people, but also green spaces, gardens and agricultural fields.

Understanding that oil reserves in Dubai may soon be exhausted, today the government of the UAE has an active policy of economic diversification in the direction of free trade zones, tourism, finances and re - exports. And Dubai has achieved impressive results in it - a lot of companies from around the world opened in the UAE their subsidiaries, branches and representative offices and work successfully in this country.

Market segmentation

Market segmentation is an art and science of dividing the total market into homogeneous segments and getting, keeping, and growing customers through creating delivering and communicating superior customer value.

Market for the crude oil is divided basically on the basis of internal and external customer base.

The internal customer base would further be divided:

Regular customer base - It would include all those purchasers who make frequent demans in order to supply further.The terms and condition sets with them are flexible and have a special loyalty towards the product.They basically constitutes the domestic industrialist This would further be divided into:

a. Household consumption - Business industries may transform the product into further levels that would be helpful for the household to use for the direct consumption,

b. Business purpose - Some of the industrialist would purchase for the further processing and then selling the refined oil to the other business partner for making several different products that might be possible..

Irregular customer base - They are the ones who made not regular purchases. The only motive for purchasing this is to fulfill the special purpose of their own. They basically constitutes the industrialist who manufactures the sophisticated machineries.

Statutory supplies - The use of crude oil might be there for the defence department of the country where the supplies become mandatory irrespective of profit or loss faced by the refinery company.

External segmentation - This segmentation is done outside the boundaries of the home or domestic country. Its categorization are:

1. Neighbourhood - That would constitutes the neighbouring countries to whom the supplies are made. The relation with those countries are grnerally good and helpful in the setting the term for reducing tarrifs

2. Good political relation countries - These countries are those with which the home country is having the good relation. The negative impact of supplying to them is company has to make supply even at a loss for the sake of political reasons.

3.Enemy relation countries- The countries with whch the political relations are at verge would be treated as enemy relation countries. Here the company is not able to capture the large share in profit.

4.Rival countries - These are those countries that are too supplying the same product to the rest of the world. Exports are made to these countries if their home countries are not able to make sufficient supplies.

5. Major export contributors - The countries that make the comparative large demand to those of others and bring large amount of profits are the major contributors of the exports.

5. Minor export contributors - From these countries the contribution for profits is less and they share a fraction percentage in exports.

6. Opportunity market - These include those customer base on which the company has the potential to capture them. Exports are not made by the company itself but by the competitors.

Strengths

1. Spending on alternative energy

2. Investment in high profile projects.

3. The brand image they have created sustaining over 80 years.

4. Management are highly skilled and operatingth company.

5. Integrated its business across the hydrocarbon value chain to create impact.

6. Lead in the technology development and innovation.

7. Highly skilled sales forces and very efficient and wide distribution channels.

8. The lower barriers of market entry. As it supplies the crude oil which is raw material for all kinds of petroleum and oil.

Weakness

1. Declining replacement rates over the years.

2. Future profitability.

3. Ability to compete with the existing competitors.

4. Rapidly increasing cost of skilled manpower.

5. The cost of mining and refinery pushing the cost of innovation.

Opportunity

1. Growing Asian pacific population and expansion of their economy will lead to the greater demand for the energy.

2. Bio-fuels and alternative energy methods.

3. New markets for oil and gas in avrious cities.

4. Growing demand for crude oil day by day.

5. Growth rate and profitability can be increased.

6.Incredible export potential and innovative products.

Threats

1. Prolonged global recession.

2. International union strikes and other global political events.

3. Global economy.

4. Increasing cost of mining and refining crude oil.

5. Growing competition and lower profitability.

6. Increase in labour costs.

7. Unexpected problems arises anywhere.

8. Environmental regulation that can be threat for mining.

The total measure of economic effects of crude oil and natural gas production on the host nation or community especially for developing countries could be best described by the impacts: direct, indirect and induced. The direct impacts are measured as the jobs, labour income and value added to the oil and gas industry whereas indirect impacts are measured with the same yardstick but occurring across the supply chain due to crude oil and natural gas production activities. Induced impacts are measured as jobs labour income, and value addition resulting from household spending of labour and proprietor’s income earned either directly or indirectly from crude oil and natural gas production activities

Crude oil and natural gas production activities have been found to make enormous economic contributions that benefit both the host nations and the citizenry. Some of the ways through which crude oil and natural gas production contribute to the economy include.

Oil and gas companies, involved in crude oil and natural gas production, pay billions of dollars in taxes to the government of their host countries every year. These funds help pay for important government services, such as education, health care and provide infrastructure that benefit the citizens of the country.

Royalty is the share the government receives from companies producing crude oil and natural gas from the nation’s reserves. The amount is usually dependent on the volume of crude oil or natural gas produced.

The oil and gas industry employs millions of people all over the world. These are usually high-paying jobs that make a great percentage of them live above the average income, spend within the community and pay taxes to the governments.

The periodic injection of purchasing power through its local expenditure on goods and services by the oil and gas production industry is another way of contributing to the economy of the host country. Payments to local contractors for goods and services and for direct purchases has the capacity to stimulate the economy and also exert secondary influences, through multiplier process on the level of output and employment in other related sections of the economy.

Since crude oil and natural gas are sold in international markets, producing countries has the potential to earn and save foreign exchange in reserves. This puts the country’s economy in healthy position and gives her the capacity to finance the foreign exchange cost of any development program.

Most oil and gas companies are quoted at the various stock exchange markets. This makes it possible for citizens to invest in these stocks and enjoy the privilege of the innovation, growth and dividends associated with such investment.

Crude oil and natural gas production is done either on land or on water. The area occupied for this purpose would have been used for the purpose of farming and fishing respectively. In most communities where oil and gas production activities are being carried out, the traditional occupations of the people prior to oil and gas discovery are being abandoned. The country, in some cases, may even resort to total reliance on the production of oil and natural gas for economic growth leading to a mono product economy.

The adverse impacts to ecological resources during production of crude oil and natural gas could occur from: disturbance of wildlife from noise and human activity; exposure of biota to contaminants; and mortality of biota from colliding with aboveground facilities or vehicles. The presence of production wells, ancillary facilities and access road reduces the habitat quality, disturbs the biota and thus affects ecological resources. The presence of an oil or gas field could also interfere with migratory and other behaviors of some wildlife. Discharge of produced water inappropriately onto soil or into surface water bodies can result in salinity levels too high to sustain plant growth. Wildlife is always prone to contact with petroleum-based products and other contaminants in reserve pits and water management facilities

Possible impacts to public health and safety during production include accidental injury or death to workers and, to a lesser extent, the public (e.g, from an OHV collisions with project components or vehicle collisions with oil or gas workers). Health impacts could result from water contamination, dust and other air emissions, noise, soil contamination, and stress (e.g, associated with living near an industrial zone). Potential fires and explosions would cause safety hazards. Cavitation could ignite grass fires. Increased or reckless driving by oil or gas workers would also create safety hazards. In addition, health and safety issues include working in potential weather extremes and possible contact with natural hazards, such as uneven terrain and dangerous plants, animals, or insects.

Land use impacts during the production of crude oil and natural gas would be an extension of those that occurred during the drilling/development phase. Although it is possible for farmers or fisher men to carry out activities around the well locations, restrictions would always exist.

Although new jobs and businesses would be created and royalties and taxes paid to land owners and government, there is a potential negative impact on the value of properties located in the proximity of oil and gas field. This effect increases as the number of wells increase.

During the life of a production well, the integrity of the well casing and cement will determine the potential for adverse impacts to groundwater. If subsurface formations are not sealed off by the well casing and cement, aquifers can be impacted by other non-potable formation waters. Hydraulic fracturing fluids have the potential to contaminate groundwater drinking reservoirs. Stimulation fluids may penetrate away from the fracture and into surrounding formation. When stimulation ceases and production resumes, these chemicals may not be completely recovered and pumped back into the wellbore, and, if mobile, may be available to migrate through an aquifer. Most produced water is unfit for domestic or agricultural purposes (e.g, it is extremely salty or contains NORM or toxic compounds). If it is disposed of by release to the surface without treatment, it can cause soil and surface water contamination. The majority of produced water is disposed via injection in disposal wells or enhanced recovery wells.