Investment and Fireworks Industry

Topics: Investment, Strategic management, Foreign direct investment Pages: 4 (1230 words) Published: February 18, 2013
3. Case Study: The Chinese Fireworks Industry
 4. Outline 1. Synopsis 2.Problem Statement 3.Analysis 3.1 PEST Analysis of the General Environment 3.2 Five Forces Analysis of the Fireworks Industry 4. Conclusion and Recommendations  5. 1.Synopsis 1.1 About Liuyang Liuyang , a city in HunanProvince, is known as the “ the home of firecrackers and fireworks ”. The fireworks making in Liuyang has a long history and tradition in China, and enjoys high reputation in the domestic market. In addition, it was the top fireworks exporter in the world, covering 60% of the global production.  6. 1.2 About Jerry Yu Jerry Yu, who was running a small chain of gift stores in NewYork, was asked to invest in a fireworks factory during his visit to Liuyang. He was impressed by the extravagant fireworks shows he had seen during the spring festivals. He’d like to know more about the development background and specific situation of the Chinese fireworks industry before his investment.  7. 1.3 About the report This report intends to make a detailed and comprehensive analysis in terms of the general environment and fireworks industry itself based on the PEST and Five Forces Model . At last, some recommendations are provided for Jerry.  8. 2. Problem Statement 2.1 Should Jerry invest the Liuyang fireworks industry? 2.2 What was the best way to capitalize on the potential that remained unexploited in the industry?  9. Economic Environment Social Power Political Policies Technology Suppliers New entrant Suppliers Industry competitors Buyers Substitutes  10. 3. Analysis 3.1 PEST Analysis of the General Environment 3.1.1 PEST Analysis of General Domestic Environment 3.1.2 PEST Analysis of General Foreign Environment  11. Advantages: (Advs) Eased legal restriction of foreign direct investment Chinese fireworks market ----a magnet for foreign investors 3.1.1 General Domestic Environment Political  12. Disadvantages: (Disadvs) More regulations on cost-driven firms...
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