Shui Fabrics
Ray Betzell, the general manager of a joint venture between Ohio-based Rocky River Industries and Shanghai fabrics Ind. After many years of production, Rocky River’s President Paul Danvers wasn’t satisfied with the annual return of 5%; he desired an annual return of around 20%. But from the view of Chui Wai, deputy general manager, believed that Shui was generating just the right level of profit-not too much and not too little.
When operating on an international basis, it is important for managers to give considerable thought to economic, legal-political, and sociocultural factories. Those two companies are from different countries, one is from China and another one is from the United States. China is attractive for low-cost manufacturing of goods, on this way, China has larger market and sales more products but with lower price, which means lower profit. The united states running on opposite way have high income per hour worked, less products but with high quality and high price. That’s why President Paul Danvers wasn’t satisfied with the annual return of 5%.
The different perspectives between those two companies go to different side. On one side, the president of was unhappy with the 5% return of investment. On the other side, the Chinese deputy general manager was actually very happy with the venture because it was having a positive impact on the local economy by providing jobs, and producing the right amount of profit allowed by the government. In this case, there is a conflict between those two companies. Different cultural values in different countries, it makes non-sense if we say which is correct or not, because they are both depends on different situation. Those two companies should balance the values between each other, it is important for Rocky River to enhance the market but still keep the same quality, and then the company can get to