Haier's Strategy in China
Haier’s Strategy Analysis
Company Introduction
Company current situation
Haier Group is the No.1 brand of large-size household appliances in the world. So far, Haier has established 25 manufacturing bases, 10 R&D centers, and 19 overseas trade branches. The company has more than 70,000 employees all over the world. During six consecutive years, Haier’s brand value amounted to $14 billion in 2010 and is ranked as the No.1 of the “top 500 Chinese brands”. Haier is also named as “the most valuable Chinese brand” on September 9th, 2011, which is its 10th consecutive years at the top of the ranking. The range of Haier's products covers almost all the household appliance segmentations, including refrigerator, air conditioner, washing machine, TV, water heater, computer, mobile phone, etc.
Company strategy development history
1. Brand building phase (1984-1991): In this period of time, Haier Group focused on only one product- refrigerator. 2. Diversification Development phase (1991-1998): During this period of time, Haier has diversified from one product to a variety of products through acquisition of stagnant companies. Haier’s belief was to develop and expand itself in the shortest time with minimum cost. 3. International strategy phase (1998-2005): Haier sold its products in great volume to major economic regional markets in the world. They built its own overseas distribution network and after-sales service network and became a rapid-growth company with sound reputation and recognition. 4. Global brand building strategy phase (2005- ): The global strategy focused on creating localized Haier brand in different countries and become a global brand.
Porter’s “Five Forces Model”
1. Threat of new entrants
Admittedly, there are relatively low barriers to entry in Chinese household appliances industry because potential entrants have low risks to access to this industry. Objectively, because of a huge market demand in China, more and more enterprises are attracted
Company Introduction
Company current situation
Haier Group is the No.1 brand of large-size household appliances in the world. So far, Haier has established 25 manufacturing bases, 10 R&D centers, and 19 overseas trade branches. The company has more than 70,000 employees all over the world. During six consecutive years, Haier’s brand value amounted to $14 billion in 2010 and is ranked as the No.1 of the “top 500 Chinese brands”. Haier is also named as “the most valuable Chinese brand” on September 9th, 2011, which is its 10th consecutive years at the top of the ranking. The range of Haier's products covers almost all the household appliance segmentations, including refrigerator, air conditioner, washing machine, TV, water heater, computer, mobile phone, etc.
Company strategy development history
1. Brand building phase (1984-1991): In this period of time, Haier Group focused on only one product- refrigerator. 2. Diversification Development phase (1991-1998): During this period of time, Haier has diversified from one product to a variety of products through acquisition of stagnant companies. Haier’s belief was to develop and expand itself in the shortest time with minimum cost. 3. International strategy phase (1998-2005): Haier sold its products in great volume to major economic regional markets in the world. They built its own overseas distribution network and after-sales service network and became a rapid-growth company with sound reputation and recognition. 4. Global brand building strategy phase (2005- ): The global strategy focused on creating localized Haier brand in different countries and become a global brand.
Porter’s “Five Forces Model”
1. Threat of new entrants
Admittedly, there are relatively low barriers to entry in Chinese household appliances industry because potential entrants have low risks to access to this industry. Objectively, because of a huge market demand in China, more and more enterprises are attracted