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China Dolls

In: Other Topics

Submitted By Zak2302
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DECISION CRITERIA
If expand to china, HCF need to either operate their own factory or they can joint venture with Chinese manufacturer2. If they are going to stay in Malaysia, they need to shut down the factory in Chieng Mai which going to risk them lose the China’s influence. Jeffrey need to consider moving to China and can supply the clothes at lower prices. If they move to China, HCF will receive a reasonable resale value as its equipment was renewed from Butterworth and Penang factories.3. Substantial profit in selling the land as the factories located in fast developing area. He felt that HCF will lose its independence if they consider a joint venture. The continuous of the operations while waiting for the new factory to be ready. Higher costs since HCF do not have sufficient funds. Both factories have low resale value as they are located in rural areas and hard to sell them. No resale value as they only need to improve the current Malaysian factories. No resale value involve.
RECOMMENDATIONS (ACTION AND IMPLEMENTATION PLANS)
It is recommended and advisable to HCF management to move their operations to China wholly by itself and shut down its current operations due to the following reasons. 1) Even though it would take 18 months for the new factory being completed, but in the long run, HCF would become more profitable due to the lower labor cost and larger factory production capacity. 2) By choosing this alternative, HCF would not only secure its current clients, but also might have bigger chance to attract new customer in contract manufacturing activity. 3) HCF could issue shares to the public in order to generate funding for the new factory setup. 4) Setting up its own brand name is also good, but HCF needs time to prepare for it, and currently, HCF is yet to be ready. 5) Joint venture must not be selected if HCF wants to fully control and manages its

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