Ornamental Fish

Sri LankaBY THUSINI RANASHIGHE

MISHALI THEMPANA

VENU SANTHITAN

SUPUN ABAYAWARDANA

Overview 1. Outlook of the Sri Lankan Economy

2. Ornamental fish industry of Sri Lanka

3. World Ornamental fish industry

4. Challenges, barriers and risks in the domestic industry

5. Special Characteristics & trade terms in the Ornamental Fish Industry

6. SWOT Analysis and PESTEL of the Ornamental fish industry

7. Export and import policies implemented by the Sri Lankan government

8. Country analysis

9. Possible modes of entry to the market

10. International Business Strategy

11. Conclusion

12. Recommendations

01. Sri Lankan Economy Finishing of the civil war 2009, Sri Lanka started to

development rapidly. Development in the economic environment Infrastructure development & Regional development 7.80% growth rate in GDP 2013

Inflation : - 4.70% as per 2013.12.31 Interest rates : - 6.50% as per 2013 Unemployment : - 3.80% as per 2013 Exports : - 1031.80 USD million as per 2013 Imports : - 1647.50 USD million as per 2013

Balance of payment USD 615.70 million

02. Ornamental fish industry in Sri Lanka

The industry was first started in 1952, the country exports marine, fresh water, brackish water fish species and marine invertebrates.

The fish has rich bio-diversity giving an competitive advantage to the exporters.

Fresh water fish are guppies, swordtails, platys thorns tetras, angels, gourami's, catfishes. These fish are colourful and eye-catching. The most demanded fish in the global market are guppies.

Sri Lanka has two seasons, Northeast (December to March) and Southwest (June to October) monsoons.

Animal Quarantine health standards goes to every shipment. Hobbies and to reduce mental stress

02. Ornamental fish industry in Sri Lanka

The industry is supported by coral reefs, sand bars, lagoons around Sri Lanka and the island comprise of inland water, streams, waterways and reservoirs help for reproducing of marine, brackish water and freshwater species in Sri Lanka.

Contribution from ornamental fish exports 0.4%

03. World Ornamental Fish Industry

Aquaculture products are demanded all around the world. The industry worth in 2003, US$ 3 Billion. Exports worth US$200 million.

Singapore is the market leader in exporting ornamental fish. The leading importer is United States owning 25% of market

share Divers are finding new ways to catch fish without harming

the environment. World demands for ornamental fish are of fresh water fish

(90%) and marine (10%). New methods are introduced to importer, buyer and

retailers. Further many other industries are supported by the

ornamental fish industry.

04. Challenges & Barriers Quality of supply and holding facility Packing method High competition Establishing a market Lack of exporters

Risk in Ornamental industry• Vulnerability

• Payments

• Sudden changes in the market

• Not entering in to contract

05. Characteristics Industrial rules and regulations by organizations,

countries and the local authority Quarantine procedures taken by the exports. Playing the supplier after reserving the shipment

Trade Terms Industry prefers always direct payments. Transportation and Export is done through air Discounts. No return policies

06. SWOT Analysis of the Ornamental fish industry

Ornamental fish Industry - Porter’s 5 Forces

07. The Import and export policies implemented by the Sri Lankan

government specific to the industry

Regulation in the imports due to invasive varieties being introduced to the water

Endangered species available which are protected and not allowed to export

Permits being issued for restricted verities Certificates required in order to export and import

08. Country analysis

United States (US) performance US has European colonization from 16th to 18th century.

US has a large market, political-legal system, vast area to cultivate, natural resources and entrepreneurial qualities and material, capital and technology.

Early 1990 till late 2000, US began Globalisation.

During these the national debt expanded by 75%, GDP climbed by 69%, and the stock market system as measured by the S&P 500 developed more than triple.

The country faced recession in 2008.

The Gross Domestic Product (GDP) 3rd quarter 2013- 4.1 percent growth 4th quarter 2013- 3.2 percent growth

The personal income of in:December 2013- 0.0 percent (individual income) November 2013- 0.2 percent (individual income

In 2013, total 20 to 22 industry groups lead to 2.8 percent rise in real GDP.

The Balance of Payments in US, 3rd quarter of 2013-$94.8billion 2nd quarter of 2013 -$96.6 billion. The current account deficit decreased by $1.8 billion from third quarter to the fourth

State personal income, personal income growth has 2nd quarter 2013- 1.2 percent3rd quarter 2013- 1.1 percent

In 2007 it was recorded that the service sector contributed toward country nearly 78.5% and the industrial sector contributed about 20.5% to GDP.

Economic drivers are exports, innovation, service sector.

Macro economic policies- Fiscal and Monetary Policy

United States Ornamental fish industry

Ornamental fish industry is most popular in the State of Florida, recording 95% of all ornamental produce in United States.

The industry is worth US$47.2 million. Warm weather to breed the fish. The industry is based in

Florida. Ornamental fish industry in US jointly breeds hundreds of

different species and different kind of fish from different geographic regions.

1. US is the largest importer in ornamental fish due to high demand.

Ornamental fish structure and value chain

Performance of the US ornamental fish industry United States considers ornamental fish industry to be a

cash cow to the country in the aquaculture economy. The largest importer in ornamental fish is US with 25%

market share. Southeast Asia accounting to about 75% freshwater fish. The

country imports approximately 1500 different species annually.

Most demanded Guppy, Neon Tetra, Platy, Siamese fighting fish, Goldfish, Chinese Algae-eater, Short finned Molly, Cardinal Tetra, Glassfish, Tiger Barb.

Approximately 201 million fish amounting to $44.7 million, imported.

The Los Angeles port handles 39% of all aquaculture trade, Miami 22%, New York 16%, Tampa 6% and Honolulu 6%.

Fresh water is amounted to about 96% of the total capacity and 80% of imports.

Florida is the only State that produces ornamental fish.

Country Analysis

Analyse the countries competitors, competitiveness and the external factors: Porter’s five forces Diamond theory PESTEL

Porter’s five forcesRivalry among existing competitors- High Singapore, Malaysia, Thailand, Philippines,

Vietnam, China, and Japan, China and Singapore.

Singapore is the largest exporter.

Threats of new entrant - High 1976 there have only been 28 exporters, and in

2004 there are 146 exporters. The industry provides employment hence

government encourages.

Porter’s five forcesBargaining power of the buyer- High Long term suppliers who have created good

relationships. Loyal customers

Threat of substitute products- High Plastic fish tanks Genetically injected fish

Bargaining power of suppliers- High Wide variety of fish High quality at low prices Delivery without harming the fish

Diamond theoryFirm strategy, structure and rivalry Private Limited Company High competition, governments promote

Demand condition Best quality Best prices Many varieties

Diamond theoryRelated and supported industries Live/dead coral, aquatic plant, sea weeds and

live rocks Ceramic and plastic ornaments

Factor conditions Technology- weather Fresh water and sea water Space Food Nutrition and aquatic diseases

PESTEL

Political

• High political pressure on local breeders and farmers.• High rules and regulations on standardization of fish• Low government sport to the industry

Economical

• Cost of production is high due to low price imports. • High labor cost

Sociological

• Lack of awareness about the local industry • The amount breading of species are less• Waste water management policies

Technological

• Poor technical maintenance of the facility• High cost on technology

Legal

• None updates acts and policies• Lack of monitoring in fish handling

Environmental

• Bad weather conditions such as tornedos, floods, etc • Lack of inadequate sewage management

Growth prospects Geographically large Recession Imports large quantities Cost of production Varieties

09. Possible Modes of Entry to International Markets

Exporting1. Direct

2. Indirect

Demanded ornamental fish Ways to get to know about the industry

1. Internet

2. Visiting international Exhibitions

3. Magazines

10. International Business Strategy

Exporting Collaborating with legal bodies or legal institutes Expanding the assortment of the ornamental fish Healthy relationship with the exporters and the

suppliers

Ornamental fish Industry -Diamond Theory

Challenges, risks and barriers of the International arena

Challenges Offering a better product Competitive prices long lasting business relationship widest range of varieties of ornamental fish Increase in the packing densities

Risks/Barriers Non-payments of the invoices Reporting of the dead fish on arrival without proper

proof Non signing of contracts

Conclusion

Recommendation Finding and exporting new products Participating in international exhibitions and pet shows Reach new markets such as Japan, Middle East, Norway Implement policies and standardization for the fish and

the industry Introducing Insurance facilities and risk baring facilities. Improving technology in transportation. Government should find new byers and then encourage

the farmers to bread more fish

Thank You