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Chinese Fireworks Industry

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Submitted By muby159
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Strategic Marketing Management

Case Study Analysis
The Chinese Fireworks Industry

MBA-E, Batch 59

Submitted By:
Bilal Waheed (13059021010)
Ahmed Burhan Khan (13059021008)
Case Outline:

The case involves a detailed industrial analysis of the Chinese Fireworks industry. The Chinese fireworks industry flourished the late 1970s and grew to make up 90% of the world's fireworks export sales. However, starting from the mid 1990s, safety concerns led Governments in China as well as abroad, to set up stringent regulations. At the same time, there was rapid growth in the number of small family run fireworks workshops, whose relentless price cutting drove down profit margins.

Now, in this case, Jerry Yu who is an American born Chinese, wants to determine whether he should consider investing in Liuyang fireworks factory or not. Liuyang is known as “the home of fireworks and firecrackers” and good at making varieties of fireworks and firecrackers. To gauge the attractiveness of industry, he made an evaluation of the Chinese firework industry by studying and analyzing following factors;

History * Product * Identified issues * Industrial circumstances * Domestic and Export Market * Predicted Future of industry
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The Strategic Decision Making:

Q.1- PEST Analysis of the Chinese Fireworks Industry?

Followings are the facts observed through performing PEST Analysis of the Chinese Fireworks Industry in the given case;

Political Factors:

* High regulations in international market considering safety issue * Intellectual property rights concerns, as many companies simply copy the better brand’s design and sell for much lesser price in the market * Unclear policies and regulations of the Govt. regarding price * Stringent Govt. restrictions * Offensive strategy of

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