In this case analysis, the Crown Cork and Seal Company is analyzed externally as well as internally along with the overall industrial analysis. The company was able to sell large volumes of metal cans around US as well as in the international markets with the aid of joint ventures…
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The economic analysis deals with the opportunity costs of resources being used along with attempting to measure the social and private costs as well as benefits in monetary terms of a project to the economy. The Crown Cork and Seal attempted to locate its business towards the areas that were closer to the customers. For the purpose of forecasting of the transportation costs of the company, the distance of about 150 to 300 miles was considered to be economical between the location of customers and the placement of plant. In addition to this, the company managed to decrease its transportation cost that was roughly estimated to be 7.5%. In addition to this, the company changed its ingredient of making cans from the use of steel to aluminium. This resulted in decreasing the weight of the cans along with reduction in the shipment cost of these cans relative to the cans produced before by the company. Furthermore, due to the shipment of steel cans in the international markets, the company suffered uneconomical circumstances due to the increase in shipment costs. For this reason, the company attempted to make joint ventures in terms of affiliation with US can manufacturers, foreign subsidiaries as well as local foreign firms in order to cater the foreign markets (Bradley S., 2005). Political: Political environment can be referred to as an immediate impact of the political parties possessing authority, representing the popular perceptions given by the citizens of the area (Export Help). It has been seen that the developments of legislations were unfavorable for metal can industry in USA (Bradley S., 2005). Social Cultural Environment: In this case, the chief executive officer attempted to bring together two companies possessing distinctive cultural and social backgrounds irrespective of the fact that the past mergers were undoubtedly unsuccessful. This impossible challenge was accepted by Avery in order to capture the markets of Canada and to expand its operations further. Moreover, there were numerous
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