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Essay Amway India Case analysis

Satisfactory Essays

CASE B-6: AMWAY INDIA

Assignment Presented to
Dr. G. N. Braithwaite-Sturgeon as per the requirements of
International Marketing ADM4328 M

University of Ottawa
January 22nd 2013

BUSINESS CONTEXT & INITIAL SITUATION

Amway, a North American Multinational, subsidiary of Alticor Inc. has over the years become one of the leaders in the 90 billion dollar direct selling industry through its use of multi-level marketing and creation of networks of independent business owners and sales. Founded in 1959 by Jay Van Andel and Richard DeVos, the company grew and captivated interest on an international level, especially in developing countries due to its ability to …show more content…

- Competitors such as other multinationals or corporations (Ex: Avon and Mary Kay) create threats for market share.

OPTIONS

Option #1: Planned Exit of the Indian Market & Exploration of Other Potential Markets.
Main Pros:
- If Amway were to implement a planned exit of the Indian market, it could sell off its current existing products while they still were able to execute business within the market and not experience any unexpected losses.
- Amway Corporation would not have to spend additional time, effort and money in legal litigations and negotiations.
- The corporation’s time could be focused on exploring other potential markets within neighbouring countries with fewer legal restrictions on the distribution of their products.
- If neighbouring countries are tapped, the existing investment in India’s manufacturing plants and machinery can still be used for fabrication of products for neighbouring countries.

Main Cons:
- Neighbouring countries could present little to no interest in adopting business practices from Amway Corporation, or could present little to no profit for the company due to the varying national economic situations.
- Loss of the 36 million dollar investment (including the 17 million state-of-the-art manufacturing facilities invested in India.
- Extremely large loss on potential profits in that particular

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