Feasibility Report on Internationalisation of an Australian Company
Executive Summary
The following feasibility report on JT Toy’s interest to manufacture overseas has thoroughly explored the positive and negative aspects of local production in comparison to moving its operations to China. Manufacturing methods, such as a wholly owned subsidiary; owning and controlling a factory in China, a strategic alliance and licensing agreements have been analysed in detail.
The evidence shows that moving part of the business to China as a wholly owned subsidiary, whilst keeping its headquarters in Melbourne would be the most beneficial long term option. Paying royalties and dividing profit with an overseas company
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A wholly owned subsidiary in China would consequently be ideal, so long as it is a strategic/tactical long term plan.
A strategic alliance is defined as “where two or more independent organisations set up a co-operative partnership to gain mutual strategic advantage.” (Bartol, K, Tein, M, Matthews). This option would involve JT Toys aligning itself with a pre-existing Chinese manufacturing company, and using each other’s strengths for a mutual advantage. The Chinese company could produce toys with their cheaper labour and production costs, while using the established brand of JT Toys, as well as their vision and successful standing in the Australian market.
This option
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Co-investment and joint venture manufacturing arrangements can help lower capital costs and leverage existing local capability, however, this approach also needs to consider the risk of IP loss and lower management control. In contrast, leveraging LE existing Indonesia & China manufacturing capability via an import model would lower upfront
The purpose of this report is to discuss and analyse the significant rise in absenteeism at the Manila, Philippines branch. The Manila branch is significant to Moda as it is a major product manufacturer and distributor. The output of the branch is crucial to supplying demand for Moda’s products to the global market and therefore it is imperative that this issue is addressed directly to avoid further complications. Furthermore, it will examine the planning and controlling managerial functions that are currently in place at the Manila branch and provide recommendations in order to effectively address this issue.
International expansion requires a clear vision and tireless work, and I believe that the steps I have outlined above for the China Development Team will make Cottage Inn China a foreseeable reality. Just as JC Penney says in his famous quote, Cottage Inn’s growth will require collaboration and hard work to gain cultural and societal knowledge about China. The strong leadership and organization in Cottage Inn’s company will make this process easier, and the China Development Team’s work can turn the vision of global expansion into physical plans. Despite the hurdles that all companies face when attempting this change, combining strong technology, a detailed global distribution model, and clear analysis of adaptations needed will make Cottage Inn’s international dreams come
Should the firm extend its supply network or manufacture a new factory and move some operations to Angola or Saudi Arabia? They are in distant locations with distinct cultures, although these are assuring markets. Or should it stay put and expand its operations by introducing
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Over the years the company’s management has searched for alternative manufacturing sources, even participating in the setup of Chinese manufacturing facilities with a second Korean supplier. They have also searched in Malaysia, Singapore and other Asian countries but none have the combination of raw material sources and transportation facilities that can compete with the Chinese. Accordingly, China has a lock on the world’s toy manufacturer business.
Strategic alliances are defined as “a partnership between an organization and a foreign company in which both share resources and knowledge”. This helps both companies grow and develop new ideas and products. Business and partnerships of any sizes can benefit from international partnerships because they provide a different perspective and collaborating can bring benefits to both parties.
If a firm wants to raise both its risk and reward, the next strategy would be to enter the global market through licensing. Under this strategy, a host firm can grant a person or another foreign firm the rights to the intellectual property of the host firm, including trade secrets and trademarks, in exchange for a royalty. Just like with
Hogan, M. (2014, June 16). 6 qualities of bad managers that send employees running. Retrieved from http://www.ragan.com/Main/Articles/6_qualities_of_bad_managers_that_send_employees_ru_48433.aspx
“Management Earnings Forecasts: A Review and Framework” by D. E. Hirst, L. Koonce and S. Venkataraman explained the antecedents, characteristics and consequences interlinked with earnings forecasts. Antecedents are characteristics that are prevalent prior to the consequence such as the existing environment/firm specific characteristics; and consequence is the outcome from antecedents and characteristics. Characteristics are the choices the management has deciding on how the report will be issued. The article guides the reader giving explanations of why management decides to release earnings forecasts, interactions of the three variables and its findings and how these findings may impact one period to another. Studies
I am an executive of XYZ, Inc., a well-known company in United States for its luxury watches, jewellery and handbags. There are 22 retail outlets in whole of United States. Achieving great success in the United States the company has decided to expand their business and open their retail outlets in different countries. To start off with the company has decided to open their first international store at Shanghai, China. Then after a year of time the company has decided to open stores even in Brazil, Russia, India and China.
In regards to its strategic business position, Techy should have operation in China. This is the best strategic move for the company if it hopes to compete with its international counterparts. This decision is tough as Techy American staff will be displaced. However, this decision is the best in regards to the future viability of the business. Further compounding this issue is the prevalence of Xtech's competitors who are undoubtedly expanding into China as costs of production is lower. In order for Techy to compete in this market, it too must lower its costs to a level competitive to that of its peers. The technology field is predicated on innovation. Innovation however, cost extensive amounts of money. In order to innovate quickly, large expenditures in R&D are needed. By saving money in China, more money can subsequently be plowed back into the technology research and development division. These allocations will ultimately help Techy to better compete not solely on price, but on quality. If the company can innovate effectively, it will not be subject to the price wars and lower margin business that many of its competitors will. Customers have proven they will pay premium prices for innovations that provide value to them. By saving money with operation in China, Techy can provide better innovations which ultimately generate higher margins and profits for the business. In short, I believe it is in
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Following strategies need to implement to overcome impact of offshore competitors like China & Vietnam.