Samsung is facing the competition increasing in China. On 10/23, the report of operating profit in this year has fallen about 60% that compare a year earlier. Since many people in Asia area are feeling the price of Samsung 's device is too high. For example, Galaxy S3 phone, the used to most successful product in China cost $573. But the new domestic brand- XIAOMI just cost $372 that almost is the same quality as Galaxy S3. Although, Samsung is still the No. 1
Smartphone maker around the world, it seems has lost market shares in recent quarters in the Asia. Samsung 's internal department tried to solve the problem. The company considered the big market in China; it is starting the new marketing strategy. And the company is preparing to introduce a new cheaper product for the emerging markets. For reducing the cost, Samsung has been built the manufacturing factory in Vietnam last year.
However, in this article, the biggest competitor of Samsung in China – XIAOMI RISING that makes the Samsung owns the new pressures to reduce price. Samsung estimates if reducing the price of mobile-phone and roll out the cheaper phone, it will affect about 60% of the operating profit. In fact, Samsung was an operating early partner in China. The company entered the market in 1992. Samsung’s network of stores spread all over in China from villages to cities. But nowadays, more and more customers in China are purchasing the mobile-phone online. Samsung is encountering many competitors in China. Samsung has agreed that didn 't notice the issue. It caused the situation of surplus inventory. Facing the problem, Samsung not only will reduce the phone price, but also prepare to release the new line of smart phones called Galaxy A. Galaxy A ...
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...ll create more freight transport works. Since the new product is produced in Vietnam, the shipping to China will develop, also the cost of transportation to stores will raise inside China. If the Samsung 's new strategy of sale in China is successful.
The first threat the industry obtains that is some mobile-phone business of component supply, such as crystal panel. Samsung is not only the bigger mobile-phone supplier but also the huge component supplier. When the brand finds the way to reduce the phone price by reducing the component cost, in my opinion, many component suppliers will encounter the threat of price effect. The second indirect threat is iPhone sale in China. The same as the high-end mobile-phone, Apple Company may face the influence of sale, if the charge of Samsung goes down in China. Certainly, everyone wishes to get the high quality in lower price.
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