Discuss whether AB Electrolux can compete with local Chinese consumer manufacturers. China has been an area which has shown growth in sales for Electrolux. China is often viewed as the largest market for household appliances in the world (Electrolux, 2018). China is the largest market because of the rapidly emerging middle class, and fast-paced urbanization. The Chinese middle-class are buying more and more homes, and the demand for premium appliances continues to grow. Haier Group and Midea are two domestic appliance manufactures who tend to dominate the appliance market in China. Electrolux can compete with these two companies by investing time and money into the premium market. A strong focus on the rapidly growing middle class, and focusing on selling products through large retailers will continue to contribute to Electrolux’s success in China.
Electrolux’s success can continue to grow in China, due to the
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In the sprawling urban areas, people in China simply don’t have the room that we have in other parts of the world. Research and development of products that fit the needs and lifestyle requirements of the middle-class Chinese is critical to Electrolux’s continued success in the Chinese market. Electrolux must take clues from the local companies who have remained successful for quite some time in the Chinese market, if they wish to continue their growth there.
Discuss the three leading perspectives on strategy, and how this strategy tripod influences Electrolux. Electrolux has a solid strategy focused on profitable growth. Those three strategies are: Stability and Focus, Sustainable Profitability, and Targeted Growth (Electrolux). These strategies are a key to growth, especially when entering new markets like China. Electrolux’s dedication to stability and focus is a key because they must remain stable, and focus on the
Bright Light Innovations will be able to evaluate different segments to determine differential advantages in each of those segments. Furthermore, management will be able to determine any of the particular marketing mix for a more successful strategic plan. Market segmentation can be obtained by researching geographic data (zip code, region, etc), demographic data (age, occupation, nationality, etc), psychographic data (social status, personal type, etc), behavioral data (customer behavior), or any other data that can be beneficial to the research (Kawasaki, 2004). According to Hyman and Sierra (2010), before a service or product is introduced into the market, the marketer needs to have a good understanding of the consumer’s needs and preferences. For that reason, it is recommended that management considers all of the limitations and challenges that the Nepalese market has for the Starlight Stove. Major decisions need to be made by management to effectively make profit on this product. On the other hand, Nepal is ranked in the low-income group. There are other possible markets in South Asia that can be consider and might represent a less challenge, especially since management is looking to make profit. Bright Light Innovations needs to consider GNI numbers before deciding where this product will be launched. Because there are technology limitations in Nepal, management will need to create a marketing campaign that can be clear and easy to understand by the Nepalese citizens. Magazines are always a great source of marketing, but these can represent a challenge in Nepal since only half of the adults can read and 11% of the households have electricity. Therefore, visuals and signs can be strategically placed among the different villages to target the corresponding districts. Bright
There were several trade-offs for GE to implement the shift in strategic focuses. To achieve organic growth, GE needed to increase output and sales based on customer needs, which was unlikely for GE to achieve in a short time. GE’s profit inflow would slow down in early years as a trade-off for sustainable profit in the future. Previously GE had many projects induced by merger and acquisition activities. They needed to decrease projects and more focus on long-term investment in order to achieve organic growth.
With the optimistic minds in technology, GE tapped into the well-organized pieces of technical modernizations. While they invested in the growth of its employees and the fresh minds of college graduates GE has capitalized the market as a whole. GE specializes in Engineering, Human Resources, and Sales and Marketing. For the last 160 years, GE has excelled and profited in the all the areas and endeavors they have attempted.
Growing labor and environmental regulation in the United States are increasing production costs and causing profits to decline. This issue has forced our competitors to dislocate their operations to less developed countries in order to save on costs, and we should follow similar steps if we want to stay competitive in the market. Out of the three countries suggested by Ms. Smith, Mexico seems to be the most viable choice given the low labor costs, lax environmental regulations and the close proximity of the country compared to the other two options. Nevertheless, in doing so, Electrocorp should still uphold its ethical values by ensuring safe working and environmental conditions as well as reasonable labor wages. To best understand the situation
The United States located electronic company Electrocorp faced the problem of declining profitability due to rising production costs, specifically high wages, costly worker's safety and environmental standards. In order to solve this problem Electrocorp is deciding whether to relocate some of their plants to South Africa, Mexico, or the Philippines.
3M Corporation's each division is treated as a profit center with no interdivisional business between the six divisions. The business unit strategy is to "hold" as the company wants to maintain and increase profitability and market share. In terms of corporate strategy, 3M functions as an unrelated diversified corporation with the prime goal to innovate consistently, thereby offering a...
Some of the things our team did to lead to our success analysis of the data we received both about our company and our competitors. Adjustments were made based on the feedback we received about competitive strengths and weakness and competitor actions. For example, we adjusted advertising budgets, increasing SQ, number of models produced, adding capacity, and of course pricing, corporate responsibility while meeting our benchmarks for investor expectations EPS, ROE, stock price, credit rating, and image rating (until the last three weeks where we did not meet ROE, but still ended with a weighted average of 15.2). We were careful about adding capacity, however we did not start adding capacity soon enough at the Asian plant. Resulting in having to add capacity to the North American plant which was not cost friendly considering it was a more expensive plant to run and affected our ROE. In retrospect, we should have increased capacity in Asia sooner and considered constructing a plant in Latin
With the development of China, the economy of China has become the World’s second largest after the US. On the other hand, the ...
With the intensifying competition in the home appliances market, China’s consumers’ consumption behavior was gradually becoming rational and mature. They would pay more attention to product quality and after-sale service, and the price factor was becoming less influential. To keep pace with the times, only focusing on low price is far from enough to maintain channel leadership.
However, remember that Hon Hai has the advantage of doing all these things before many of its competitors even thought about them. Competitors can copy Hon Hai by moving their manufacturing to china to achieve lower labor costs. Competitors might copy Hon Hai tangible resources such as technology, automation, and moving to low cost locations. However, it is the intangible asset which makes it very difficult for competitors to outcompete hon Hai, such as building strong relationship with customers that is not an easy thing to achieve. Moreover, Hon Hai sells its products and services at low margins and few of Hon Hai’s competitors have the minimum scale necessary or, indeed, the ambition to handle the large volume that it routinely handles.
The case looks at prescriptive strategy as applied to multi-product group of companies. Unilever is based in over a hundred countries where multiple products are being made in each. However, the market is mature which means that growth is stagnant and innovation is almost non-existent. In order to improve on growth and sales, the strategies that are needed look at how to come up with new products that have high profit margins and penetrate new markets. The prescriptive approach was used to come with a strategy to improve growth and profit. In order to improve on innovation, both the prescriptive and emergent strategies can be used since both support innovation. From the case study, not much profit was made when the ‘Path to Growth’ strategy was first implemented (2001-2004). The strategy was initially based on cost cutting. There was a need to also build volumes through existing portfolio of branded products through innovation and marketing. By focusing on increasing sales in developing countries where growth prospects were high and increasing investment in personal care products where profit margins were higher, it was possible to improve the profit portfolio.
The first innovative strategy of KFC China is localizing the menu. Trying to sell the same products or services is a typical approach to most foreign expansion for franchise businesses (Bell, 2011). However, one-size fits all approach is not what KFC chooses to implement for their company. According to Shelman, the writer of the case study regarding KFC’s Explosive Growth in China, key success for KFC China is to change the menu to suit Chinese tastes and style of eating. “One of the lessons I take away from this case is that to do China, you have to do China”, says Shelman. KFC localizes their offerings and adapts their existing products to appeal to the Chinese customers’ needs. The menu features Chinese local food like egg and vegetables soup. Examples of innovative products are the Dragon Twister (chicken roll of old Beijing) and the glass jelly milk tea (Zhou...
N.V. Philips (Netherlands) and Matsushita Electric (Japan) are among the largest consumer electronics companies in the world. Their success was based on two contrasting strategies – diversification of worldwide portfolio and local responsiveness for Philips, and high centralization and mass production for Matsushita.
The newly appointed district sales manager, Larry Barr, faces the problem of allocating sales quotas among his various sales representatives. This decision will affect everyone's earnings including his own. This problem is compounded by the fact that different territories have, for a variety of reasons, different potentials. In addition, the territory that is known to be the toughest will soon require a new sales rep.
I would recommend the continual implementation of the current strategy. The strategy is working and there is no reason to deviate from it. The company has been very successful in expanding its operations in other countries. I would recommend that the company continue to do that. I would also recommend spending extra resources in the development of new products to keep a competitive advantage over other competitions. The competition is only going to rise because the market has not reached saturation yet. In order to stay ahead of the competition, the company needs to keep researching new products, and stay in sync with the ever changing technology.