...Expanding Global Operations: Mobile Phone Manufacturing in Shenzhen, China Professor Julian Dalzell MGMT 801: Human Resources in the Global Firm Fall 2012 Group 4 Team Members: Ben Alverson Wyman Bowers Lindsay Gilliam Rod Jaraiedi Alicia Parker Yolanda Rhodes Gabriel Saracila Eric Seymore ------------------------------------------------- I. Introduction The competitive pressure in today’s manufacturing landscape is more complex than ever, resulting in the need for companies to maintain high quality levels and concurrently strive to keep costs low. As a result, investing in China has become imperative for both private and public companies. The gradual adoption of free-market business principles, bolstering low labor costs, well-managed operations and supply chain efficiency all have propelled China to the forefront of business expansion. As a growing mobile phones manufacturer, we are seeking to extend our business to China in order to successfully compete in what has become a “global economy”. Our primary objective is to identify a suitable area to stage a domestic assembly operation and regional headquarters from which other subsequent Asian operations will be managed. Once the location and plan of action have been determined, we will need to facilitate staffing operations for the new site and define the parameters for the HR philosophy for the new regional organization. All planning, execution, and staffing goals must be met within 12 months. ------------------------------------------------- ...
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...QUESTION 1 China Mobile offers to its customers the ability to pay a monthly subscription fee which includes a lump sum fee as well as a per unit charge. The concept of consumer surplus refers to the benefit obtained by consumers because they are able to buy a product for a lower price in relation to the price that they were willing to pay for the same product. In other words, it is the difference between the actual price that a consumer would be willing to pay for a specific product and the actual price that he does pay for the product. The consumer surplus is simply an economic measurement of consumers’ satisfaction when these consumers feel that they obtain a bargain deal. The graph that follows clearly shows consumer surplus. The area below the demand curve and above the equilibrium point is the area showing buyers’ surplus. Basically the graph illustrates that some consumers are willing to pay a bit more to get an extra unit of the product, however they are simply paying the equilibrium price. [pic] Source: http://en.wikipedia.org/wiki/Economic_surplus The package deal that China Mobile is offering to its clients composes of two parts – a fixed payment and a usage charge. Basically these packages try to instigate consumer’s interest by offering a lower price for the quantity that a consumer may be willing to purchase. The company structures the pricing of these packages in a way that the customer is charged something less than its total benefits. When the quota of air...
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...An Overview of Mobile Phone Distribution Channels in China February 2003 TABLE OF CONTENTS 1 CHINA MOBILE PHONE MARKET ...........................................................................2 2 CLASSIFICATION OF CURRENT HANDSET DISTRIBUTION CHANNELS ..................3 2.1 2.2 2.3 2.4 Conventional Handset Distribution Channels .....................................................................3 Conventional IT Distribution Channels...............................................................................4 Household Appliances Chains .............................................................................................4 Number of Distributors/Retailers ........................................................................................6 3 OPERATIONS OF CHINA HANDSET DISTRIBUTION CHANNELS ..............................5 3.1 3.2 3.3 Inter-Channel Relationship..................................................................................................5 Distribution Modes for GSM Handsets................................................................................7 Distribution Modes for CDMA/GPRS Handsets..................................................................8 4. 4.1 4.2 4.3 4.4 CHARACTERISTICS OF HANDSET DISTRIBUTION CHANNELS IN CHINA ........9 High-end vs Low-end Handsets ...........................................................................................9 Major cities vs medium-to-small cities ......................
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...(behind China Mobile), world's second-largest measured by subscribers (behind China Mobile), world's second-largest measured by subscribers (behind China Mobile), world's second-largest measured by subscribers (behind China Mobile), world's second-largest measured by subscribers (behind China Mobile), world's second-largest measured by subscribers (behind China Mobile), world's second-largest measured by subscribers (behind China Mobile), world's second-largest measured by subscribers (behind China Mobile), world's second-largest measured by subscribers (behind China Mobile), world's second-largest measured by subscribers (behind China Mobile), world's s world's second-largest measured by subscribers (behind China Mobile), econd-largest measured by subscribers (behind China Mobile), world's second-largest measured by subscribers (behind China Mobile), world's second-largest measured by subscribers (behind China Mobile), world's second-largest measured by subscribers (behind China Mobile), world's second-largest measured by subscribers (behind China Mobile), world's second-largest measured by subscribers (behind China Mobile), world's second-largest measured by subscribers (behind China Mobile), world's second-largest measured by subscribers (behind China Mobile), world's second-largest measured by subscribers (behind China Mobile), world's second-largest measured by subscribers (behind China Mobile), world's second-largest measured by subscribers (behind China Mobile), world's...
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...Introduction There is a rising trend outward FDI (OFDI) from emerging market, mostly dominated by countries such as China and India (Gao, Liu, & Zhou, 2013). China’s outward FDI increased from $27 billion in the year 2000 to $230 billion by the end of the year 2009. Since the late 1990s, India’s OFDI has increased to $77 billion by the end of the year 2009 (Buckley, Forsans, & Munjal, 2012). Porter’s national competitive advantage emphasizes productivity growth as the focus of success in international trade. John Dunning went on to explain in detail the drivers of OFDI using his eclectic theory of ownership, location, and internalization advantage including four major motives: market-seeking, resource-seeking, efficiency-seeking and strategic asset seeking (Gao, Liu, & Zhou, 2013). Market seeking Firms aim to capitalise on ownership of well-established brands, marketing skills and overseas distribution networks by seeking large foreign markets (Buckley, Forsans, & Munjal, 2012). Since China’s WTO accession, because of over-capacity in some sectors, Chinese manufacturers have started to invest in developed countries as well as in developing countries. Shanghai Automobile Industry Corp. bought over 50 percent stake in Korean Ssangyong Motor Co. in 2004, and TCL acquired the colour TV manufacturing from French Thomson in 2004 in order to expand their markets and achieve economies of scale. CDC Software, a wholly owned subsidiary of Chinese CDC Corporation, acquired...
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...threatened by cheap Chinese imports deal with the threat? Introduction It is never less than a challenge to attempt to understand the cultural factors which influence a nation’s conduct in the international arena. When that nation is China and the subject of introspection is its relations with India, such an endeavour can at best be fraught with far too many variables. The two have had the longest uninterrupted existence as nations. Their combined size and population makes them the largest geographical and human resource mass on the planet. India and China have had cultural, religious and trade links going back centuries in history. They also came into being as nation states almost simultaneously in this century, They also share a past of colonial and imperialist subjugation from which freedom had to be won with a major struggle, Paradoxically enough, the two countries fought a war with each other over disputed frontiers. That conflict episode, the continuing border dispute between the two countries and China’s rapid growth in military power, not unsurprisingly create anxieties about the future relationship. China’s aggressive foreign policy postures also do not encourage a benign view of it. There are enough strategic thinkers in India who reckon China to be the major future threat to India. In my presentation, I am going to focus on the trade aspect of this threat to India from the Chinese products that...
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...Q1. EBAY’s choice of market entry strategy for china Advantages • Reducing risk – Acquiring 33% of the company for 30M$ allows a slow and gradual entrance to the Chinese market. –After assuring success, the value had grown by 2.5 times, with a market share of 85%, they acquired the rest of the company for 150M$. • Established domestic company – EachNet was a significant player in the Chinese online auction market and controlled more than 50% of the market share. EachNet was the Chinese EBAY, with sensitivity to differences between the US and Chinese market. • Using well founded company with hard resources in china – Warehouses, shipping company, contracts with local supplier Etc. This will let Ebay, a smoother entrance to the market. Disadvantages • Trust issues – The Chinese customers hadhard time trusting new foreign companies, changing the brand name to EBAY EachNet emphasis this fact. • Chinese/ US culture difference – The Americans executives had a hard time adjusting to Chinese way of doing things. For example: service that was offered to the customers was a DIY, where the Chinese expected a service hotline. • “be first of nothing”, EBAY’s usual strategy, was not implemented , they didn’t have the experience nor control they were used to. Q2. Potential benefits and risks of the joint venture with TOM online: Benefits • Connections – In china connections to officials are very important for business. TOM’s biggest shareholder was well...
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...EBAY’S STRATEGY IN CHINA: ALLIANCE OR ACQUISITION In December 2006, eBay Inc., a US company that offered e-commerce, e-payments and internet communication services globally, announced its plan to form a joint venture with China-based online portal and wireless operator, TOM Online, in which eBay would have 49% ownership.1 The move reflected the increasing difficulties foreign internet companies were facing in their attempts to snatch a share of the Chinese market amid fierce competition and a changing market environment. eBay first set foot in China in 2002 by acquiring 33% interest in EachNet—a domestic online auction company, followed by a full acquisition in 2003.2,3 In 2005, eBay acquired Skype4 to expand into the online communication sector. While Skype was a wholly owned subsidiary of eBay globally, it operated indirectly in China via a joint venture with TOM Online. Due to this existing relationship between the two companies,5 TOM Online seemed to be a natural choice of partner for eBay’s subsequent decision with regards to its online marketplace business. Recognising TOM Online’s local knowledge and political connections, eBay believed that a joint venture would benefit its failing business in China and help the company further develop its Chinese market.6 Some analysts questioned whether political connections alone were the answer and suggested that eBay focus on its product and service offerings.7 Vara, V. and Chao, L. (20 December 2006) “EBay’s China retreat highlights...
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...1 Executive summary This report discusses the feasibility of opening up a Public Kitchen which is served for college students in China. It is necessary to use several management research tools to assess the feasibility, such as PESTLE, Porter’s Five Forces and Cash Flow, based on those researches, it seems that this business could success and have much developing space to improve itself in the future, for example, adding more recreational facilities in ‘Our Kitchen ’ to attract more customers. 2 Introduction The reason why I choose China as the target market is that I come from China and I am more familiar with the Chinese market than the United Kingdom’s, especially Chinese colleges and students. When I arrived at my new dormitory in the University of Birmingham, I was shocked by the big and bright kitchen for 15 students. There is no public kitchen in Chinese colleges, so almost all the students must have three meals in one or several crowded canteens or order takeout every day. As a new graduate from a Chinese college, I could realize that some students are eager to cook for themselves or host a party with their friends. What they calling for is a comparatively private and comfortable environment. At the same time, I know economic environment around Chinese colleges well. Thus I come up with an idea that launching a public kitchen for college students and it could be a brand new food service in the market of Chinese colleges. Moreover, if the idea were to come true...
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...bargaining power for the ODMs. In 2005 both Apple and Cisco split their contracts to multiple ODMs which lead to a drop in Inventec’s stock price. * Inventec had exclusive contracts with Compaq and Toshiba leading to customer lock in. Thus, when HP acquired Compaq, stocks of Inventec plummeted amidst speculation. However, other ODMs’ stocks were safe as they supplied to multiple OEMs. * Computer products greatly became commoditized in early 2000s. As a result, the OEMs had to squeeze their profits. In turn the OEMs used their bargaining power to squeeze the profits of the ODMs. Thus, for the ODMs profit plummeted from 10% in 2001 to 3-4% in 2004. * Since 2001 easing of Taiwan Government restrictions of high tech investment in China lead to huge cost saving to Taiwan ODMs. This reduced the entry barrier in the ODM industry fueling the already fierce competition in this industry. Q2: What are the drivers of the average profitability of the ODM industry? Ans: The ODM industry products are highly commoditized. Thus, minimizing cost and maximizing production output can lead to higher profits. The drivers of average profit margin of the ODM industry are: * The process of designing and manufacturing goods should be low in cost and production should achieve economies of scale. Owing to high capital investment...
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...Royal Melbourne Institute of Technology Product Innovation Case Study: WM WRIGLEY-- INNOVATION IN CHINA’S CONFECTIONERY MARKET Name and Student ID: Chi-Hao Tu S3296463 Liang Yen-Hsiang S3306170 Sophal PEN S3394842 The role of product innovation for Wrigley in China Wrigley, the world’s largest confectionary company, operates in around 40 countries, and also distributes in more than 180 countries. In Asia market, it produces wide range of confectionery products such as chewing gum, hard and chewing candy, and lollipops. If we look at market segmentation in China, there are around 28%, 24.4%, and 61.1% of high- class, middle- class, and low- class respectively. Wrigley’s penetrates Chinese local market by segmenting its market carefully. As the picture shown below, Wrigley runs 39% of whole gum market share in 2006. Due to rising Chinese middle class in recent years, Wrigley planned to launch a new set of confectionary products, both gum and non-gum products, to meet emerging new market. Having seen this development, Product innovation plays a critical role to maintain its leading market position in the industry. Resources: Chicago business.com, (http://www.chicagobusiness.com/article/20080331/NEWS07/200028762/wrigleys-newest-taste-wolfberry) To sustain consumer’s choice of its products, Wrigley continues to innovate new products not only to maintain its already-segmented market but also to attract new emerging Chinese market...
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...and others using highly trained men. These newly conquered empires also had great effects on the neighboring countries.The Mongols and the Ottoman Turks, two very different groups and yet both similar in various ways. It took a multitude of things for the Mongols to need to go and conquer all those lands. In Mongolia the annual temperatures were dropping, which meant less grass for their large herds of animals [Doc.1]. The Mongols lived off of meat and dairy from their animals so this was critical for their survival.They also depended on their animals to carry their yuks, or mobile homes build on movable platforms. The Mongols were logical people and went south to warmer temperatures, toward China where they conquered their lands and utilized it for their own needs. China also stopped trade with the Mongols during this time, meaning they no longer got things they needed, another reason they overtook China.[Doc.1] Temujin, later Genghis Kahn, early on unified all of the Mongol tribes into one. For they were always fighting and if they kept it up they would have never conquered anything and destroyed each other. The Mongols were not sympathetic when conquering these lands either. The Mongols had a very complex and organized army of thousands of men who all listened and obeyed their leader. Most everyone, if anyone, they conquered had none of this within their armies. They would go city to city and tell them to surrender or die. Most cities then had large walls around their cities...
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...BUS383 Managing Global Business Essay 1 Executive Summary: Using Lenovo as an international business, discuss the impact & role of culture in its business activities in different economies such as the United States & China in terms of political, economic, social & ethical factors. 2 Table of Contents Executive Summary:..............................................................................................................................2 Introduction...........................................................................................................................................4 Conducting Business Internationally..................................................................................................5 Impact & Role of Culture...................................................................................................................7 Difference between Western & Eastern cultures...............................................................................8 Lenovo in China / Eastern Culture....................................................................................................10 Lenovo in USA / Western Culture....................................................................................................12 Current Affairs.................................................................................................................................13 Conclusion:............................................
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...GENERAL FRAME Since Deng Xiaoping's “Open Doors Policy” (改革开放) in 1978, China has been consistently achieving significant economic growth which has been constant at an average of 10% for the past 35 years or so. Today China became the largest exporter, the largest manufacturer and the second largest importer and economy in the world (only right after the USA). With the increase of GDP, the consumption of luxury goods, and therefore the growth of the luxury market, also increased, and increased to the point that China is now among the top nationalities in terms of total sales of luxury goods. In recent years, as a consequence of the increasing of personal wealth, the consumption of luxury goods in Mainland China has been growing, until last year, 2014, when the sales decreased to 15 billion euros (negative growth you -2%) due to three main reasons: the first one the slowing of Chinese economy; the second the tendency of Chinese people to purchase products either abroad or via cross border online platforms since the taxes on the products are lower than in their country; and the last one the government's anti-corruption drive (started two years earlier, in 2012) Regarding this point it is interesting to notice how this particular fact mainly affected the men watches sector, which recorded negative yoy growth rates of -13% (gift giving concept: probably the most popular gift for men). BUT... Nevertheless the small decrease in consumption, the luxury market is still...
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...In a radical departure, many businesses are discovering tiiat manufacturing their products onshore rather than abroad is more efficient—oni/ cheaper. BY Brendan I. Koerner In early 2010, somewhere high above the northern hemisphere, Mark Krywko decided he'd had enough. The CEO of Sleek Audio, a purveyor of high-end earphones, Krywko was flying home to Florida after yet another frustrating visit to Dongguan, China, where a contract factory assembled the majority of his company's products. He and his son, Jason, Sleek Audio's co-founder, made the long trip every few months to troubleshoot quality flaws. Every time the Krywkos visited Dongguan, their Chinese partners assured them everything was under control. Those promises almost always proved empty. As he whiled away the airborne hours, Krywko made a mental list of all the manufacturing glitches that had nearly wrecked his company. There was the entire shipment of 10,000 earphones that Sleek Audio had to discard because they were improperly welded, a mistake that cost the company millions. Then there were the delivery delays caused by the factory's lackadaisical approach to deadlines, which forced the Krywkos to spend a fortune air-freighting products to the U.S. Even when orders were produced on schedule, Krywko wasn't too pleased with the situation: S6 The company always had precious cash tied up in inventory that took months to arrive after the prototypes had been approved. The headaches had finally become too exasperating...
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