Professional Documents
Culture Documents
Shailey sakhuja: 37
Anamika veronica roy: 124
Ankita chaudhary: 125
Jasleen kaur: 136
Jyoti kataria: 137
Shweta badhwar: 240
12/08/21 1
1. INTRODUCTION
2. BUSINESS ENVIRONMENT
Economic
Technological
Regulatory
Political
Social
Supplier
3. TYPE OF COMPANY
4. ENTRY MODE
5. MANAGEMENT ORIENTATION
6. QUESTIONS
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Product- FULLY AUTOMATIC WASHING
MACHINES ALONG WITH SEMI-AUTOMATIC
MACHINES.
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It is established in India, U.S. manufacturing
CRT tubes, television, grillers.
It wants to manufacture fully automatic washing
machines due to rising demand.
It will incorporate technologies like Silver Nano,
Air Wash technology, child lock and Ceramic
Heater that provide you the most effective
washing experience.
There are companies that manufacture semi
automatic washing machines.
ABC CO. has decided to acquire wit MAN CO.,
which is already manufacturing semi automatic
washing machines,and set up their plant at
MSEZ.
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Economic growth surged to 11.2% y/y in Q1 from an
upwardly revised 7.3% in Q4,bringing the FY2009-2010
growth rate to 7.4%.
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Rising disposable income & standard of living
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The SEZ office will facilitate registration of the
unit, allocation of land, permission for construction
of building and approval of building plan, power
connection, environmental clearance and water
requirement.
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Positive Technical policy
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Indian Govt. has given 100% income tax
exemption for expenses incurred in research of
technology in India.
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There will be exemption on payment of stamp
duty and registration fees on transaction of land
as well as financial agreement, deeds etc. Sales
tax and other state taxes will be exempted on
transactions within SEZ. Inputs made to SEZ units
from DTA units will also be exempted from sales
tax. Exclusive arrangements will be made within
SEZ for law and order. A committee headed by
the chief secretary has been constituted to review
promotion, development and function of SEZs in
the state. The government of India had
announced a policy for SEZs during March 2000
under the Import-Export Policy with a view to
augmenting infrastructure facilities for export
production
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Drastic change in lifestyle
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Incorporate a host of futuristic and innovative
technologies like Silver Nano, Air Wash
technology, and Ceramic Heater.
logic machines.
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The merger has cut the extra work of finding
out various suppliers and than wasting days
in negotiation over terms and prices
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LAN CO. LTD : Multinational company
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MAN CO company manufactures semi
automatic washing machines.
After acquisition:
Fully automatic washing machine :
satisfying the needs of new generation.
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HORIZONTAL MERGER- Though it is an
acquisition but at the meeting of Board Of
Directors it is decided that as the 2 companies are
of equal size and it is a friendly takeover the
acquisition will be declared as a merger and the
name of new company will be LANMAN CO.
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Reasons for merger (LAN CO.)
To reduce the tax liability
Vertical Integration
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Gain market share
Economies of scale
Enter new markets
Acquire technology
Utilization of surplus funds
Managerial Effectiveness
Strategic Objective
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16 other competitors at the time of merger:
LG, Samsung, Philips , Daewoo, etc
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Assets: Rs 50 crores
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Indirect export :
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Filling orders from domestic buyers who then
export the product
Seeking out domestic buyers who represent
foreign customers
Exporting through an Export Management
Company (EMC)
Exporting through an Export Trading Company
(ETC)
Franchising
Licensing
Contract manufacturing
Piggyback marketing
Remarketer
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Independentprivate firm that acts like an
export department for several non-
competing manufacturers and producers.
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Identifying international markets for your product or
service.
Locating customers overseas.
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• One of the three legs in the EPG
framework.
• Host country orientation.
• Reflects host countries goals and objectives.
• International business practices local
preferences and techniques are usually found
most appropriate to deal with the local
market conditions.
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Unique local market factors that should be
recognized in pricing decision are
1. local costs
2. income levels
3. Competition
4. local marketing strategy.
for the short term, our company might decide to
pursue a market penetration objective and price
at less than the cost-plus return figure.
Another short-term objective would be to
estimate the size of a market at a price that
would be profitable given local sourcing and a
certain scale of output.
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Focus is not in building facilities.
The target market would first be supplied
from existing higher-cost external supply
source.
Product price can be changed according to
the approval of the market.
If the market accepts the price and product,
the company can then build a local
manufacturing facility to further develop the
identified market opportunity in a profitable
way.
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QUES) Which method of international
expansion has the company used to date?
ANS) Trade related- Indirect export by
establishing plants in SEZ’s and then
exporting to foreign countries.
Investment- FDI through Mergers &
acquisitions.
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QUES) Has the company used the most
appropriate development method?
ANS) Yes the company has used the most
appropriate development method keeping in
mind the various environmental forces
(economic, technological etc.), its assets and
also keeping in mind the acquired companies
strategies, share capital, business.
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QUES) What other methods might be suitable for
the company?
ANS) Filling orders from domestic buyers who
then export the product.
Seeking out domestic buyers who represent
foreign customer.
Exporting through an Export Trading Company
(ETC):
Export Trading Companies (ETC) are very similar
to Export Management Companies. It is more
likely to take title to the product and pay you
directly.
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Franchising:
Franchising requires large expenses to support foreign
marketing such as advertising. Companies with
successful domestic operations may opt for franchising.
Licensing :
A license is a contract to identify what is being
licensed.
Trademarks
Patents
Designs
Copyrights
Software
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Contract manufacturing :
Agreements with foreign manufacturers to produce
your product, as opposed to exporting your product,
are referred to as contract manufacturing.
Piggyback marketing :
This is an arrangement in which one firm distributes a
second firm's product or service. The second company
adds value by offering a more complete solution to the
foreign market.
Remarketer :
A remarketer purchases products directly from
the manufacturer, and repackages the products
according to their own specifications
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QUES) Should different methods be used
in different markets?
ANS) Yes different methods should be
used in different markets because the
characteristics of different environmental
forces in different markets change the
entry strategy, entry modes, management
orientation. If we don’t consider the
differences in various markets our plan,
entry mode, expansion mode and finally
the product may fail leading to a huge
loss.
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