Galanz Case Study

1088 WordsMay 8, 20135 Pages
Post these responses directly in your private student journal. Your assignment is due Wednesday, April 10th. Then a forum will open for each of these assignment questions. Please write two-to-three paragraphs per question. 1. What are Galanz's competitive and operations strategies? Considering the expertise of international players like Panasonic and Toshiba, Galanz didn't really have a competitive advantage with respect to technology. Cost arbitrage (of land and labor) was the chief competitive strategy employed by Galanz to capture the Chinese microwave market. Galanz conjured up mutually beneficial deals with its clients to achieve rapid expansion of production capacity by arranging for production line transfers, process and…show more content…
Thus, after the superlative domestic success, Galanz focused on building a world brand by maintaining its low cost, abundant supply and stressed on important aspects such as customer relation management and after sales support. 2. How does Galanz's operations strategy support its competitive strategy? Initially as a market entrant, Galanz focused on a low cost strategy to gain leverage in the domestic market. This strategy was supported by an abundance of cheap land and labor. The expensive microwaves produced by players like Toshiba and LG were unaffordable for majority of the Chinese population and hence, Galanz became popular right from its inception. The rapidly increasing demand, which rose to almost 25 million units in 2003, for these low-cost microwaves prompted Galanz to expand its production capabilities. Galanz, facing shortage in production, decided to outsource magnetron production to Japan for the production deficit that it faced. Furthermore, deals with customers like Fillony to transfer entire production lines made sure that the ever growing demand for the ovens was met successfully. The perennial working shifts for the production team ensured that production scale and costs of Galanz was unmatched anywhere in the entire market. Galanz's strategy of a price war worked in its favor as competitors like LG and Panasonic went out of business in the

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