Galanz

Increase production efficiency by consolidation in manufacturing facilities. With a higher production volume, the new AGI might be able to negotiate for lower cost from different suppliers and manufacturers.

Whirlpool is the world’s largest producer and marketer of small and large home appliances such as mixers, food processors, washing machines, refrigerators, air conditioners, etc. Whirlpool also has a long standing relationship with Sears, which sells Whirlpool products under the brand name Kenmore. In addition to its North American presence (both manufacturing and sales), Whirlpool also has a strong presence in Mexico, and Europe. Being the largest producer in the world has helped Whirlpool to compete on lower costs through economies of scale and through its Global Procurement Organization (GPO). In addition, its large networks also help in

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The most dominant problem addressed in the case that Haier is facing is that it lacks of brand popularity in the global market, comparing to its direct competitors such as Whirlpool, GE appliances, and Electrolux. Even though Haier made its effort to amplify its brand image and popularity globally by making a bid to acquire Maytag Corporation yet did not succeed, it is still difficult for Haier to enter the high-end segment of the US white goods market. According to statistics from Euromonitor, Haier’s 2013 market shares in consumer appliances segment in the North American and Western European markets were 0.9% and 0.5% respectively, which are significantly lower than Whirlpool’s, one of Haier’s major competitors in the U.S. and Europe,

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The grainger.com website, which hit $1 billion in sales in 2007 had, until recently been operating at a negative margin, with a write-off of $125 million in 2001, grainger.com has gone back to the basics. Yet, one of Grainger’s most significant core competencies will always be with the company’s knack to efficiently manage logistics, supply chain and warehousing of over 188,000 products in 9 distribution centers, and over 450 branch based stores.

Being the largest microwave manufacturer in the world, with strong commitment to R&D, expertise in manufacturing, logistics and quality control, and increased brand recognition in the overseas market Galanz has gained the competitive advantages for OBM export business. Galanz’s need continue to increase investments in innovation and branding in order to sustain the competitive advantage in the global markets and ensure that incremental gains are made to ensure profitability

To win orders, Galanz adopted a low-price strategy. Low product prices which can be afforded by domestic market triggered more demand. With this increased demand, Galanz achieved greater economies of scale, which helped to lower costs and prices further. In addition, it also attracted foreign manufacturers to transfer their production facilities to Galanz. With the cheap price of

Haiser entered into overseas markets as a contract manufacturer for multinational brands in early 1990s. First exported products to UK, then Germany, France and Italy. It also establisted joint ventures to explore the foreign markets; i.e. established a JV with Mitsubishi to set up China’s largest AC (“air conditioners”) production plant in 1994, in 1995 set up a JV with a local firm in India to produce refrigerators and ACs, in 1997 establised a JV with a Yugoslav company in Belgrade to produce ACs.

Galanz was successful because of its low price strategy this was possible because it acquired the production lines from other companies. Galanz increased production (product quality and production scale) through a free production line transfer, assembly technology , part customization, production site improvement, training for Galanz’s operators and staff (from Fillony, Toshiba, Sanyo, Whirlpool, GE, SEB, DeLonghi) and used the excess capacity to produce microwaves under its brand name for the domestic market. When companies like Toshiba and Panasonic refused to offer enough magnetrons to Galanz, Galanz decided to invest in R&D to create their own design for the

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.