Research Report - Ghana

Irrometer Company INC.

June 6, 2018

Researchers
Andrea Nichtawitz, Ariana Lopez, Jose Rivera, Josefina Gonzalez
Ramon Aguilar, Jianna Zeltner, Edgar Martinez

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EXECUTIVE SUMMARY

This globalization proposal report is an analysis and market research for Irrometer Company, INC
and Ghana. Our findings provide statistical and governmental evidence through primary and
secondary methods in order to further expand the opportunities. Through an extensive search, we
were able to compose a dominant list of recommendations and strategies including a detailed
timeline to follow in order to meet the goals desired. We also found fundamental, yet potentially
crucial information about Ghana’s cultural Framework. We believe each segment of the proposal
report below in conjunction, will create tremendous strategic benefits for Irrometer’s globalization
plan. It will lead them into the right paths, with the right point of contacts and a solid strategic
plan in order to take their business to the next level in Ghana.

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INTRODUCTION

Irrometer Inc. is an irrigation company founded in 1951. Its mission is to optimize and maximize
irrigation and water conservation. Irrometer was the first company to commercially produce such
technology, which is an efficient way to deliver irrigation water for agriculture,
nursery/greenhouse and landscape/urban irrigation. It can also be used for automatic irrigation
systems and signaling for data logging systems and inputs to weather stations.

COMPETITORS

The use of soil moisture-based irrigation scheduling has been proven an efficient way to deliver
irrigation water for agriculture and urban irrigation. We discovered a couple of Irrometer’s
competitors also have distributors and dealers in the Ghanaian market. These include Soil
Moisture Equipment Company, and Terawet Green Technologies, Inc. Irrometer is the original
name in soil moisture measurement that provides American manufactured solutions to help
growers improve efficiency, increase profits, and conserve resources.

Soil Moisture Equipment Company

This company built the first pressure membrane extractor and tensiometers which was made to
characterize the moisture holding sectors of the soil (Soil moisture, 1984). They developed a new
technology that processes the dielectric of the materials within the moisture. Soil Moisture
Equipment Company is an indirect competitor of Irrometer because they have dealers in Kenya
and other parts of Africa but not in Ghana yet. They could potentially expand into the Ghanaian
market and become direct competitors.

Terawet Green Technologies, Inc. (TGT)

They provide earth-friendly initiatives, products and systems for soil and water. Their line of
products contribute to a systematized agricultural water usage, and innovative bio solutions to
increase quality of the crops, and a Nanotechnology for clean drinking water (Terawet, 2017).
Terrawet is a direct competitor of Irrometer. They use a company named Fairfax Multi Services
as their distributor in Ghana.

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ECOSYSTEMS & VALUE PROPOSITION

Ecosystems are the interactions to human well-being. The human well-being generates the needs
for a good life, health, personal security, the experience of freedom, and good social relationships.
These needs are achieved through the beneficial use of ecosystem services and its determinants
and constituents. Irrometer’s prime value proposition anticipates the focus of a progressive
ecosystem increase for an enhanced human well-being for all Ghanaian inhabitants. The nation is
unfortunately undergoing an adverse crisis in water and sanitation. We analyzed the most recent
records containing roughly six million Ghanaians lacking the access to safe water, as well as, 18
million lacking access to improved sanitation. These unsafe water and poor sanitation
consequences have created the outcome of 70 percent of all diseases in Ghana. Moreover, this
crisis also leads to the entire lack of toilet facilities for 67 percent of the nation. As poverty
remains widespread in Ghana, this water calamity becomes an additional struggle when that
widespread is required to pay up to 10 times more per liter for water services. This benefits the
critical need in helping decrease Ghana’s current ill-being.

Irrometer is a significant tool needed in Ghana’s market to begin its value proposition focusing on
the growth of water reserve and to enrich the development of its agriculture.The ecosystem
support on water regulation is a determinant of Ghana’s security allowing an essential opportunity
to live in an environmentally clean and safe accommodation. This will also allow the opportunity
to observe, study, and learn about ecosystems, serving as constructive good social relations.
Additionally, the nation’s health advances will start by having the ability to be free from
avoidable diseases. This will be caused by the facility of having adequate and clean drinking
water, clean air, and energy allowing warm and cool. Irrometer will pertain to these determinants
and constituents leading to the best of Ghana’s human well-being. Creating also a reduction in
water cost through the investments in Irrometer’s improved water asset. Additionally, the use of
rapid technology is considered imperative when targeting Ghana.

The innovative technology used by Irrometer for soil moisture measuring is primary to Ghana’s
immense agricultural irrigation. However, gold and cocoa lead the chart of Ghana’s chief sources
of foreign trade. This contributes to the agricultural industry which employs roughly 45 percent of
the work force, primarily involving small landowners. This generates a niche involving the focus
on essential soil measuring. These methods will benefit enhanced usage of water resources and

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the sustainability of Ghana’s plantation productivity, creating essential revenue growth for
Ghanaian cultivators, as well as the nation.

METHODS

The data and research was gathered in two different formats. We conducted primary data, which
includes interviews with Irrometer Inc. representative as well as statistical databases such as
Trading Hub. We also applied secondary data from government websites and organizations such
as Gold Key Service, Export.gov, Youth Alliance, Rainforest Alliance and more.

SUPPORTING EVIDENCE

The Trade Stats Express data, market research, and industry research. According to Trading
Economics the Gross Domestic Product from Agriculture in Ghana increased to $1,821,143.22 in
2017 from $1,680,690.16. GDP From Agriculture in Ghana averaged $1,443,796.99 from 2006
until 2017, reaching an all time high of $1,821,143.22 last year. (Exhibit 1)

Exhibit 1

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U.S. Merchandise Trade Exports to Ghana on Harmonized System: 8432 Agricultural machinery
for soil preparation and cultivation 2016 - $47,700, 2017 - $121,370. Ghana’s Import Tariff on
Harmonized System: 8432 (Other machinery). Import Duty: 7%, Value Added Tax: 15%,
National Health Insurance Levy: 2.5%. (Exhibits 2 & 3)

Exhibit 2

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Exhibit 3

U.S. Merchandise Trade on Harmonized System: 9027 Instruments for physical/chemical

analysis, for measuring or checking viscosity, porosity, expansion, surface, tension or quantities
of heat, sound or light. Balances in the year 2016 - $2,154,184 Balances in the year 2017 -
$1,105,633. Import Duty: 7%, Value Added Tax: 15%, National Health Insurance Levy: 2.5%.
(Exhibit 4 & 5).

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Exhibit 4

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Exhibit 5

FINDINGS: TRANSGLOBAL STRATEGY

The SWOT Analysis is based on market research and assessment of firm capabilities and
resources as well as Ghana’s opportunities and possible threats (Exhibit 6).

Strengths

Irrometer is a company that has been in business for 67 years. Due to its longevity, people trust
the company as it has name recognition and exposure of products in some other areas of the Sub
Saharan Market such as South Africa and Kenya. Irrometer offers discounted wholesale pricing to
accommodate dealers & distributors in order for the company to upsell and generate revenue in a
win-win scenario.

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Weaknesses

The size of the company is small, there are only 25 employees, making it harder for the company
to expand the sales of their products. Irrometer is new to the Ghanaian Market making it difficult
for the company to search and find distributors, buyers and partnerships with organizations and
government. The lack of a traditional and digital marketing plan is starting to hurt the company as
the world we live in is moving towards more technological platforms.

Opportunities

The United States is known to be Ghana’s second main import partner. This allows a much more
convenient process for Irrometer’s market entry, as there is a progressive relationship between the
U.S. and Ghana already in place. In addition to that, both countries share the same official
language, that being known as English. Both of these opportunities also create closer openings
with the nation’s administration.

The government of Ghana supplies a fundamental opportunity to extension research projects by

allowing the opportunity of supporting a foremost part of project funding. Similarly, this
generates a beneficial support for Irrometer, enabling people the education required to get to
know their products attentively. There will also be further prospects of attracting potential
partners. For instance, affiliating with dominant universities and organizations, or even
partnerships with well-known dealers and distributors.

The agriculture industry in Ghana has become one of the leading GDP components. This calls a
great need of Irrometer goods to continue supporting the industry’s growth. Moreover, the general
import of agricultural machinery from the U.S. to Ghana will soon start increasing.

Threats

While our proposal is determined to expand Irrometer’s market by targeting Ghana, the following
signals should be carefully assessed before entering the new market. A common mistake that

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globalizing businesses sometimes make, is assuming the idea that whatever works in their native
setting will also work elsewhere in the world. Irrometer has the advantage of previously
globalizing in other sectors of Africa. However, regardless of it being a nearby market, it is
important to understand each country’s threats. Ghana, for instance, is a country that is inclined
when it comes to pricing in the economy.

Most of the nation’s prices are commonly established as being fixed. This can create a
disadvantage in the way Irrometer does business. Some of the elements we found during our
research as commonly fixed are: oil, food cost, and gas. In addition to its fixed pricing setback,
food cost is dominated by surviving farming. Therefore, Ghana focuses primarily on growing
only the food needed to feed the entire civilization. Lastly, we found according to records that the
country’s infrastructure relies profoundly on gaps that deal with energy and transportation.

Exhibit 6

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PESTEL ANALYSIS

The PESTEL Analysis is a marketing framework that focuses on the macro-environment factors
that could, in way way or another, have an impact on the business.

Political

The government’s vision for the next four years is to modernize agriculture, improve production
efficiency, achieve food security, and profitability for our farmers, all aimed at significantly
increasing agricultural productivity. The Ghana Feed the Future Agriculture Policy Support
Project (APSP).

Economic

According to Trading Economics, Ghana's GDP increased by 8.1% year-on-year in the fourth
quarter of 2017, following a 9.7 percent growth in the previous three-month period. Agriculture
iis currently at an 8.5%, decreasing from a 9.8% in the previous quarter, mainly due to livestock
(4.6 percent compared to 6.7 percent) and fishing (4.4 percent compared to 50.6 percent).
Agriculture is responsible for 20% of GDP by hiring more than 50% of the Ghanaian workforce.

Social

According to the World Factbook on the CIA website, 57% of the Ghanaian population is under
the age of 25. With an immense number of young residents like this, it allows a higher learning
expectancy for the agricultural industry.This Literacy and school life expectancy in Ghana as of
2015 are its highest. The total literate population is 76.6%, male being 82% and female 71.4%.
Children attend school primary to tertiary all 12 years.

Technological

Radio is still Ghana’s most popular medium for now. In recent years the Internet and TV have
increased in popularity. In 2016-2017 over 9 million (34%) of Ghanaians were using the internet

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through smart phones. We predict that this increase will only continue to move forward in the
upcoming years if the country can figure out a way to decrease the constant power outages.

Environmental

According to the World Factbook by the CIA, there is a continuous drought that deeply affects the
agricultural activities; deforestation; overgrazing; soil erosion; poaching and habitat destruction
threatens wildlife populations; water pollution; inadequate supplies of potable water.

Legal

Laws and regulations in Ghana for business operation are to conform all international standards
and best practices according to the Ghana Investment Promotion Center (GIPC). Contracts
impossible of being violated ensures commercial rights and obligations. Damages are
compensatory, not punituve and an independent court system ensures equitable protection of
rights (GIPC, 2018). One of Ghana’s government policies are to reduce the tax burden on
enterprises and reform of the regulatory environment will lead to a more business friendly
economy.

CULTURAL FRAMEWORK

Cultural differences can potentially become a challenge and in some instances turn into deal
breakers. We believe it is crucial for Irrometer to learn Ghana’s culture in order to grow strong
long-term partnerships, to make them feel respected and to show that you care not just for their
money but for their people. There is a “right to left” handshake tradition. You would start by
shaking the hand of the person that is on your right side first. Another important point mention is
that Ghanaians prefer face to face contact. In-person meetings with potential partners is essential
from time to time to build durable business and personal relationships.

Meetings tend to begin late and last for a longer time. Ghanaians like to start meetings talking
about personal anecdotes and family before getting to business. It is valuable to them take you

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care about their family and you ask to see how they are doing. Remember to always respect
hierarchy, a higher social status, elders and professional/academic titles.Finally, being asked for
gifts and favors from contacts in Ghana is quite common but make sure you politely deny such
requests. As a U.S. business owner and citizen, you can be subject to prosecution under the
Foreign Corrupt Practices Act if you agree to do so.

RECOMMENDATIONS AND STRATEGIES

Gold Key Personalized Business Matchmaking

Customized market and industry briefings prior to your business meetings, plus an out brief to
discuss the results of meeting and appropriate follow-up strategies (USembassy). The Gold Key
Service meets one-on-one with pre-screened Ghanaian buyers, sales representatives, and business
partners through the service. Gold Key Service provides preparation of a meeting agenda,
screening and selection of companies and ministries (Export). The Gold Key Service gives the
opportunity for Irrometer to meet new customers, partners and distributors.

Dizengoff Ghana Limited – Distributor

Is a world leading international manufacturer in Ghana. Provides products and solutions in

agriculture, communication, electro-mechanic and building inputs. Dizengoff installs and
maintains drip lines, sprinklers, micro-sprinklers, micro-jets, rain guns and center pivot irrigation
solutions. Not only does it maintain and distribute in Ghana, but Dizengoff is a well known
company in the farming community mainly for its products in agriculture and gardening and
water saving products. Dizengoff is a good choice to partner up for distribution and product
maintenance in Ghana.

Please find the company’s contact information below in order to begin communication and start
creating a partnership with Dizengoff as your prefered distributor in Ghana. Their Head office is
located at 2 Feo Eyeo Road. North Industrial Area, Accra. Their phone number is + 233 302 221
815/831. They always have a Kumasi Branch located at Abenchie Road, Dadiesoaba Asafo. Their
phone number is +233 576 518 350 and their email is info@dwagh.com. Finally, their website is
www.dizengoffgh.com for additional information before making the initial contact.

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Rainforest Alliance - Key Organization

Established in 1987 to conserve biodiversity and ensure sustainable livelihoods. The Rainforest
Alliance works together with tourism business to produce and export palm fruits, nuts and oil.
They work together with the government for training and technical assistance to increase value of
raw materials. Rainforest Alliance is environmental, social and economically sustained, which
will give the opportunity for Irrometer to introduce their water saving products and educate
people on the new low water products offered.

Youth in Agriculture in Ghana(YIAP) - Government funded program

Works with the youth of Ghana for a better understanding in agriculture. The youth is encouraged
to participate in modern agriculture and new technology training. Farming jobs are becoming
extinct and the youth have started an organization that teaches younger people how to farm. The
main goal for this program is to implement new ideas and new technology. With the help from
Irrometer, new technology education can help the organization and build a relationship. There are
many employment opportunities in agriculture and those jobs will keep increasing. Not only will
agricultural productivity rise but crime will be reduced as well as other social problems in Ghana.

The report above, provides an in depth analysis of the Ghanaian market in relation to Irrometer
and the possible opportunity to expand into that market. Based on our findings, we firmly believe
that Ghana is the right market for Irrometer. Our evaluation of the current market lets us
recommend a timeline of a 12 month period. Our recommendations and strategies should begin
their course as soon as possible in order to have optional conditions and avoid competitors to
hoard the market. Our final recommendation is to create marketing strategies for Irrometer and
Ghana in order to take your business, partnerships, and ROI to the next level as quickly as
possible.

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Exhibit 7

REFERENCES

Business Meetings. ”Gold Key Service” (2011, April 22). Retrieved May 29, 2018, from
https://2016.export.gov/ghana/servicesforu.s.companies/businessmatchmaking/eg_gh_0285
96.asp

Free Images. (2017, August 09). Retrieved May 29, 2018, from https://pixabay.com/

Ghana - Business Customs. (2017, July 27). Retrieved May 29, 2018, from
https://www.export.gov/article?id=Ghana-Business-Customs

Ghana GDP From Agriculture. (2018). Retrieved May 29, 2018, from
www.tradingeconomics.com/ghana/gdp-from-agriculture

Ghana Investment Promotion Center. (2018). Retrieved June 2, 2018, from

http://www.gipcghana.com/invest-in-ghana/doing-business-in-ghana/laws-regulation.html

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Ghana's Water and Sanitation. (2017, May 30). Retrieved May 29, 2018, from
https://water.org/our-impact/ghana/

Gold Key Service (Matchmaking). (n.d.). Retrieved April 4, 2018, from

https://tm.usembassy.gov/business/getting-started-turkmenistan/gold-key-service

Ghana profile - Media (2018). Retrieved June 2, 2018, from

http://www.bbc.com/news/world-africa-13433793

Irrometer Company, Inc. (2017). Retrieved May 29, 2018, from www.Irrometer.com

Rainforest Alliance. (2018, May 1). Retrieved May 29, 2018, from https://www.rainforest-
alliance.org/about

Shipping to Ghana from USA. (2018). Retrieved May 29, 2018, from
http://www.usgshipping.com/shipping-to-africa-from-usa/shipping-to-west-africa/shipping-
to-ghana-from-usa

Soilmoisture. (1984). Soilmoisture Equipment Corp. Profile. Retrieved from

https://www.soilmoisture.com/Dealers/

Terawet. (2017). About us – Terawet Green Technologies. Retrieved from

http://terawet.com/resources/distributors/

The World Factbook: GHANA. (2018, May 01). Retrieved from

https://www.cia.gov/library/publications/the-world-factbook/geos/gh.html

Youth In Agriculture. (2018, May). Retrieved May 29, 2018, from

http://mofa.gov.gh/site/?page_id=1173

Youth In Agriculture Programme. (2018, May 24). Retrieved May 29, 2018, from
http://agricinghana.com/2011/12/31/youth-in-agriculture

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