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Case Analysis (Global Management) - Essay Example

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For instance, in 2003, demand rose significantly for the products offered by the organization in the UAE, thus giving the business much more opportunity to…
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Case Analysis (Global Management)
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Download file to see previous pages Instead of attempting to over-reach the company’s total capacity, seeking opportunities to maximize its current market position would be the most appropriate.
Why is this? Chabros established a competitive pricing model that was aligned with an acceptable operating margin. Coupled with this competitive advantage, Chabros also maintained a quality-focused customer relationship management process that included flexible payment terms and no requests for letters of credit. This was a sustainable strategy until the global economic recession in 2009 which radically reduced sales in certain subsidiaries. As a proven business model of CRM and the ability to establish very competitive pricing in key markets, the business would only require adjustment of its current sales and marketing strategy to achieve the desired improvements in revenues. With the business always being at risk of changing currency values, market demand, and recessionary concerns, improving capacity would add more expenditures to the operating budget that would not, likely, offset gains by simply improving output capacity for its high revenue-producing production facilities.
The most appropriate strategy for Chabros is to pursue a market penetration strategy to achieve its desired results. By maximizing capacity, increases in salaries and other associated labor would be highly detrimental to achieving market success. Chabros was considering entering the Moroccan market as a means of expanding its market presence, however there are factors that could seriously impede progress in finding rapid sales success there. Firstly, tariffs are extremely high on both products, especially veneer, which would have to translate into higher pricing in order to offset these new costs. Add to this a value-added tax rate of 14 percent, it is not likely that the same competitive advantages as related to pricing would work in this market when having to incur all of these ...Download file to see next pagesRead More
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