Assigment

1) Economies of Scale: with regards to Economies of Scale, we have Product-Specific ones with regard to the fact that there is a minimum efficient scale of production in the industry, without which firms wouldn’t survive in the environment; requirements, in this case, are 75 million pounds of cereals per year to be efficient.

Answer the next question on the basis of the following production possibilities tables for countries Alpha and Beta:

1. How significant (quantitatively) of a problem is the mismatch between supply and demand for L.L. Bean?

Read “New IASB Leader Embraces Challenges” which can be accessed through the DeVry online library. Choose a country that has already adopted IFRS. In 2-3 pages (12-pt type, double-spaced) answer the following questions:

c. How consumers maximize utility, and how prices are established in markets for agricultural products

5. How would you go about deciding the appropriate batch size for the Stonehaven factory? What factors would you consider? How do they interrelate? (You may wish to do some calculations, but concentrate on thinking conceptually.)

The business idea of Zara is to link customer demand to manufacturing, and to link manufacturing to distribution. And based on this general idea, Zara has several essential elements for its business model. First, speed and decision making, which means that in the external level, Zara need to respond very quickly to demands of target customers, and always keep in style. While for the inside, Zara treasure intelligence and judgment of common employees who enjoy a great deal of autonomy. Second, its marketing, merchandising and advertising strategy. Zara does not spend on virtually advertising, while it spends heavily on stores, and no selling online because of

Zara has inadvertently taken an operational approach to mitigating risk through having decentralised stand alone store systems that interact once a day with headquarters therefore requiring little protection and staff only having limited access and control over their part of the system, not a network of data (Austin and Darby,

-Since Zara has a short lead time for delivering products, it keeps no buffer stock and most, if not all, logistics arrangements were centralized at the head office in La Coruna. This makes Zara very vulnerable to accidental incidents.

Zara’s strategy is to offer cutting edge fashion at affordable prices by following fashion and identifying which styles are “hot”, and quickly getting the latest styles into stores. They can move from identifying a trend to having clothes ready for sale within 30 days (whereas most retailers take 4-12 months). This is made possible by controlling almost the whole garment supply chain from design to retail.

Zara’s product differentiation strategy is based on high quality and low prices. The company wants to be fashionable and desire for everyone. This is the reason of their strategy (low price and high quality).

In comparison to competitors, Zara’s business strategy, in regards to strategic partnerships and cost of production, provide for a strategic competitive advantage. Zara, unlike its competitors such as Gap, Benetton, and H&M, does not use Asian outsourcing. Eighty percent of Zara’s materials are manufactured in Europe, with 50% made in Zara controlled facilities in the Galicia region of Spain near headquarters. Most of Zara’s competitors have 100% outsourcing to cheap Asian countries. Though the cost of production in Spain is 17-20% more expensive than Asia, Zara does have a competitive advantage over its competitors in regards to operations. The local strategic partnerships that Zara maintains with manufacturers in Europe allow for a product throughput time of 3-4 weeks from conception to distribution. To make this happen, the company designs and cuts its fabric in-house and it acquires fabrics in only four colours to keep costs low. The proximity of these suppliers gives Zara great flexibility in adapting their product lines based on up to date market trends and consumer behaviour. It also decreases costs of holding inventory. Zara’s competitors, through outsourcing to Asian countries such as China, sacrifice the benefits of proximity for low labour and production costs.

1. IF you were CEO of Harley Davidson, How would you compare the advantages and disadvantages of using exports, joint ventures, and foreign subsidiaries as ways of expanding international sales?

The third factors that the producer must consider to come in the foreign country is the technological of the country. The producer must use the suitable technological for the country. It is because if the producer use the low technical from the country , the country will decrease their believable to the producer because they look their technological is more better. But , if the technological that producer use is very high the country also don’t know the technology and they also cannot be acceptable. Besides that, the technological that the producer use must have been easy to the labor of the country to manage. If the labor don’t know how to manage it, the process of production may take along time. That means, it will increases the cost of labor. So it will failed the goal of the company to save the labor costs.

main strategy for the North American market is to aim for higher sales, while raising the proportion of locally produced automobiles. Toyota Motor Corp have reached a stage where investments made over the last several years to expand production capacity are beginning to show returns and improved profitability can be expected. Toyota’s goal is to bolster local production through additional investment, and contribute to the regional economy by expanding its operations. At present, our production capacity in North America is approximately 1.25 million units (including our joint venture with GM). However, Toyota Motor Corp plan to boost this to 1.45 million units during 2003.