A well-established organization is seeking to expand its operation internationally in Vietnam. The Purpose of the report is to analyses the situation and cultural in Vietnam and business level strategy and market entry strategy |
Table of content
INTRODUCTION:-TCL is one of the world’s leading manufacturers of multimedia electronics. Its main product is the color TV. TCL has branches across all over the world, such as Huizhou, Henan, Wuxi, Inner Mongolia, Nanchang, and Chengdu in China, Juarez in Mexico, Bangkok in Thailand and Poland (TCL Multimedia). As one of the world’s leading firms of multimedia electronics, geographical expansion is the first priority. That's why TCL is planning to expand its business in Vietnam. Understanding that the different in cultural issues can be a great obstruction for the success rate of the enterprise and realize the importance of industry analysis will help to calculate the cost possibility of the proposed venture, the senior management team authorized this report. This report aims to identify the differences and similarities in Vietnamese and Chinese cultures by using the Hofstede cultural dimensions. The situation analysis is also discussed in this report with advantage, disadvantage and potentiality and possible threats. Moreover, Porter Five Forces Model is used to conduct the analysis of the multimedia electronics company in China and provide a detailed analysis of the business segment in Vietnam, TCL Multimedia, which is a well – established corporation in multimedia electronics in China, has been authorized a detail analysis based on four keys issue. Firstly, Hofstede’s cultural dimensions are provided to the senior management team of TCL with an appropriate understanding of Vietnamese culture, and the different between Vietnamese culture and that of China. The analyses come up with 2 similarities which are individualism and uncertainty avoidance and 3 differences which are power distance, masculinity and long-term orientation. Besides that, this report will discuss about business – level strategy. It will focus on Porter five forces model and Competitive strategy. It also helps senior management team decide the suitable strategy to adapt to Vietnam.
BUSINESS LEVEL STRATEGY
Porter Five Force’s model
Robbins, Stephen P. (2008, p288) defined that “Porter proposes that some industries are inherently more profitable than others. In any industry, five competitive forces dictate the rules of competition. These five forces determine industry attractiveness and profitability. Managers assess an industry’s attractiveness using the five factors.’’ 1. Threat of new entrants
The cost of production technology is relatively large, considering the current competitive market, a new entrant requires a lot cost of advertising and sales Moreover, and they need to acquire huge financial and highly skilled workers to consolidate market position.
2. Threat of substitutes
Three-Dimensional (3D) Television is a new technology which allows consumers enjoy 3D movies, TV shows and video games at home. Several television manufacturers are already on the 3D market including Panasonic, Sony and Samsung. The main reason consumers ponder on trying 3D TV is that they need to buy such new TV equipment as 3D ready TV and 3D capable Blue-ray player. Another reason is the 3D technology is not mature enough and consumers are not willing to be guinea pigs for a new market. For this reason, Liquid Crystal Display (LCD) in the market still has some edges. (What is 3D TV? 2010)
3. Bargaining power of buyers
Accompanied by a number of advanced technologies, the demand for household wares is now growing fast. The development of the market space is very broad. Since the 80's, the development of technology has not been advanced ever in the history. The biggest buyer of household wares is characterized by rapid growth. From the buyers’ point of view, the quantity that the...