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Local competition (Supor / ASD) Analysis - Essay Example

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In 2004, it was listed on the Shanghai Stock Exchange and from 2006; the French firm Groupe SEB owned 71.31% of Zhejiang Supor’s equity, while Supor Group held…
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Local competition (Supor / ASD) Analysis
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Download file to see previous pages At the end of 2011, the cookware products the company of were revealed by the media to contain huge levels Manganese, a harmful element to human health. This issue elicited many reactions from the general public, until at the beginning of 2012 when the company alongside other government officials rubbed of the claims saying that levels of manganese were within the recommended health standards. Nevertheless, the situation increased consumers’ concerns over the safety of the company’s products, which influenced Supor’s brand reputation and, in turn, negatively impacted sales because Chinese consumers are highly cautious about safety issues (Woke, 2012, para, 1-3).
Supor runs its activities in five main areas, which comprise of Hangzhou, Vietnam, Wuhan, Yuhuan, and Shaoxing. In Wuhan, the company has a production potential of up to eight million pieces of cookware, while in Shaoxing, production processes have been hampered by inadequate finances. The manufacturing capacity in Shaoxing base is projected to hit 9.25 million units in future.
Supor focuses on the production of its own brands, without manufacturing for third party brands or private label products. As well as the production of homeware products, it also produces consumer appliance.
By end of 2012, electric appliances had become major business for Supor, accounting for 55.5% of total revenue. Kitchen products accounted for 44% of Supor’s overall revenue in 2012, while rubber and plastic products accounted for 0.5% according to the company’s annual report.
From 2008 to 2011 Supor’s revenue and net income maintained rapid growth. In 2012 H1, the company’s revenue was RMB 3,338 bil, down 4.04% year on year; the net income reached RMB 241.8 mil, down 4.61% y-o-y (CorporateInformation, 2014, para 1). The main reason for the decline lies in the global economic downturn and ...Download file to see next pagesRead More
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