Strategy and Business Environment Assignment

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Strategy and Business Environment Assignment

Class Student name Submit Date

: MBQPM4 : Ha Trung Hai : December 9th 2012

1. Introduction
SKF is one of the leading global suppliers of products, solutions and services in the area of rolling bearings, seals, power transmissions, services and lubrication system. The company business is divided into three divisions Industrial, Automotive and Service. Each division serves a global market, focusing on its specific customer segments. SKF has over 100 manufacturing factories all over the world and its own sale companies in 70 countries. SKF is also represented in140 countries through over 15,000 distributors and dealers. It is always close to customers for the supply of both products and services. SKF was founded in 1907 and from the beginning it focused intensively on quality, technical development and marketing. Nowadays, SKF is the biggest company in bearing field in the world. It continuously improves products and services with the highest quality and the latest technology to satisfy the demands of customers. In Vietnam, SKF Vietnam is a Representative office which was established in 1991 with over 30 employees. After 21 years, SKF Vietnam has developed sharply with 38 distributors and dealers around the country to provide customers best products and services to all kind of industries.

2. SWOT Analysis
2.1 Strengths Worldwide brand, lots of well-known companies in the world are using SKF products for its production lines or engines or machines. In the market for over 100 years. In early of 20th century, it was considered a monopoly company in bearing segment. SKF always stays up to date and keep its customers updated by helping continuous training its staffs. The products quality is very high and it is evaluated as the best products among bearing manufacturers around the world. 2.2 Weaknesses - The selling prices are always higher than competitor’s selling prices. - The sales team is not strong enough to cover market. Thus some major competitors from Japan like NSK, NTN or Nachi has chance to attack SKF’s existing customers - Working policy is not clear and not good enough to keep experienced employees to work for long time. 2.3 Opportunities In Vietnam, A developing country, it is considered a very potential market due to the economic growth with high rate and the increase of foreign investors in industry segment every year. The number of European investors in Vietnam increase significantly. They usually prefer to use European products for factories or manufacturing because of high quality products. Therefore SKF has advantages to supply its products to these types of customers.

2.4 Threat There are many major competitors from Japan and America such as FAG, NSK, Nachi… who competes with SKF by better selling prices. Especially, in Vietnam market, the price is very important when negotiating with customers.

3. PESTL Analysis
3.1 Political

- The Government’s policies for foreign investors are not stable and always change. Therefore SKF has to change company’s policies of business activities accordingly to adapt the changes.

- SKF has a trading policy to forbid employees giving commission to customers. It will be considered lubrication or corruption. And this policy is making difficulty to sell SKF’s products to state companies. 3.2 Economic SKF Vietnam is being influenced by the macroeconomic factors and due to the slowdown of the Vietnam economy recently, the total revenue is almost flat from 2009 to 2012. The increase of import taxes is also a factor which impacts to SKF’s revenue. The interest rate is quite high. Thus, some key OEMs cannot reach the loan for their manufacturing and consequently, they reduce buying products from SKF.

3.3 Social SKF Vietnam is a brand of SKF group. Therefore it has to follow the code of conduct of the group. SKF has to take responsibility toward customers, distributors, employees, society and shareholders. SKF...
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