Unicon Concrete Products (H.K.) Ltd Case Report
April 1, 2010
Unicon is a major player in the flourishing Hong Kong market for pre-cast concrete products and Mr. Li, the deputy managing director is pursuing the idea of “blanket” approval for Unicon’s custom design concrete products with one of it’s largest customers, the Hong Kong Housing Authority. This proposition could offer savings to both Unicon and the customer but this could adversely affect the relations with other customers and the manufacturing operations. If Unicon is to stay competitive in the ever expanding market, management must have a plan to expand capacity. This will become necessary to fend off new competition from mainland China. Statement of issues
The main issue faced by Unicon is that its operations strategy may not be able to keep up with the changes that are fore coming in the market. Unicon must stay competitive now more then ever and make plans to utilize it’s strengths as the markets change. Another issue is the implication of product base regulation. How will Mr. Li’s proposal affect the way Unicon and its competitors do business with HKHA? Criteria
From the case there appears no reason not to seek a blanket approval with a more standardized product. There is potential for huge cost savings but only partially to Unicon. The case shows that the savings per project could be HK$150,000. Unicon was manufacturing pre-cast products for seven housing blocks per year which would be a total annual savings of over HS$1 million.
From the data provided in the case, one is lead to believe that Unicon can produce more than 7 blocks per year. I base this on the following analysis; Current production of facades is 25 per day assuming 1/ mold. Slab production is 64-101 per day depending on building configuration; take an average of 82.5 slabs/day. 1120...