CASE STUDY: ECCO GLOBAL VALUE CHAIN MANAGEMENT
CASE STUDY: ECCO GLOBAL VALUE CHAIN MANAGEMENT
Question 1
What opportunities and threats exist for ECCO?
Opportunities
Threats
Political/Legal
-Labour laws are more flexible in non-European countries. E.g. in China, there were labour costs are lower.
-Ease of entering new markets due to possibility of improvement of employment rate in country. E.g. in ECCO expected to employ 3000 people in China.
- Restrictions such as taxes etc.
-Eventually corruption (such as China : they don’t know yet how it will work there)
Economical
-Lower labour cost in non-European countries like China, Thailand,
-New growing markets , as the rise of the purchase power in China
-Production cheaper abroad : lower wages, cheap machines (as in china)
-Improvement in interest rates and economic growth in China, Thailand and Portugal
-Sales and profit will be smoothened by reducing the risk of underperforming regions.
-Establishment of a market presence globally increase the global brand power of ECCO
-Partnerships
-New CEO since 2004 (more market oriented)
-Inflation rate in China, Portugal and Slovakia kept fluctuating making forecasting and strategic planning difficult.
-Operating margin falling since 2000
-Company debts rising
-Due to rapid economic growth, monetary side suffered Domestic currency losing its value)
Social
-Use of the Scandinavian reputation (slogan ‘Scandinavian minimalism’ already used)
-People increasingly aware of products’ quality
-Extension in China bad seen
-Change in customers’ needs could not easily be predicted, leading to inventory problems.
- Due to the technological developments ECCO staff was reduced/suffered shortages (Portugal & Slovakia)
Technological
-New finds thanks to the invests
-Countries specialization
-Production was kept in house
-Benefited from partnership with specialized companies like Maingroup.
-Intensive capital invested in Portugal has led to an improvement in the laser technology
Question 1
What opportunities and threats exist for ECCO?
Opportunities
Threats
Political/Legal
-Labour laws are more flexible in non-European countries. E.g. in China, there were labour costs are lower.
-Ease of entering new markets due to possibility of improvement of employment rate in country. E.g. in ECCO expected to employ 3000 people in China.
- Restrictions such as taxes etc.
-Eventually corruption (such as China : they don’t know yet how it will work there)
Economical
-Lower labour cost in non-European countries like China, Thailand,
-New growing markets , as the rise of the purchase power in China
-Production cheaper abroad : lower wages, cheap machines (as in china)
-Improvement in interest rates and economic growth in China, Thailand and Portugal
-Sales and profit will be smoothened by reducing the risk of underperforming regions.
-Establishment of a market presence globally increase the global brand power of ECCO
-Partnerships
-New CEO since 2004 (more market oriented)
-Inflation rate in China, Portugal and Slovakia kept fluctuating making forecasting and strategic planning difficult.
-Operating margin falling since 2000
-Company debts rising
-Due to rapid economic growth, monetary side suffered Domestic currency losing its value)
Social
-Use of the Scandinavian reputation (slogan ‘Scandinavian minimalism’ already used)
-People increasingly aware of products’ quality
-Extension in China bad seen
-Change in customers’ needs could not easily be predicted, leading to inventory problems.
- Due to the technological developments ECCO staff was reduced/suffered shortages (Portugal & Slovakia)
Technological
-New finds thanks to the invests
-Countries specialization
-Production was kept in house
-Benefited from partnership with specialized companies like Maingroup.
-Intensive capital invested in Portugal has led to an improvement in the laser technology