Market Entry – NBC Institute

CSME – Nov 2015 – L2 – Q7 – Corporate Strategy Formulation

Analyzes reasons for slow growth in DAB phone sales, uses the S-shaped growth curve to evaluate market stages, and suggests sales improvement strategies.

Question

Ade John is a graduate of XYZ University. For his final project work in the Department of
Electronics and Electrical Engineering, he designed a cell-phone that is rugged, cheap,
handy and not sophisticated.
During his national service year, he kept toying with the idea of manufacturing the cellphone. To ascertain that there is a market for the phone, he carried out a series of market surveys among rural farmers, artisans, market women, etc. Each time, he was convinced that a market actually exists for his design. He also made contact with some manufacturers of cell-phone components. He entered
into an agreement with CKT Japan to import cell-phone accessories to enable him
assemble them in Nigeria. DAB phone is the first of its kind in the Nigerian market and
production and assembly commenced in a small room in his uncle‟s house at Ikare.
The first batch of phones manufactured by DAB Company was supplied to cell-phone
vendors in cities on „sale or return‟ basis. To encourage distributors to accept the
phones, a 15% margin was allowed. In addition, independent sales persons (hawkers)
were given between 10 -12% margin to sell the product. In spite of the low price of DAB
phones, demand was disappointing at the end of the first year. Nevertheless, Ade John is
still optimistic about the commercial viability of the phone if only he could develop an
effective strategy to market the DAB phones

Required:
a. Identify and explain TWO reasons for the slow growth of sales of DAB phones. (4 Marks)
b. With the aid of an S-shaped growth curve, evaluate market development of DAB phones. (6 Marks)
c. Recommend the strategies that Ade John can use to improve sales. (5 Marks)

Answer

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Tags: Market Entry, Product Development, S-shaped Growth Curve, Sales Strategy
Level: Level 2

Topic: Corporate Strategy Formulation
Series: NOV 2015

CSME – May 2019 – L2 – Q1 – Environmental Analysis

Prepare a business environment and competitive analysis for UBC Plc's intended investment in GSM phone manufacturing using SWOT, PESTEL, Porter’s Five Forces, and Kant’s categorical imperative.

Question

a. You have just been contracted by UBC Plc to prepare a business plan on the company’s intended investment in the manufacture of GSM phones in the country. The following is a summary of the brief given to you and your own research:

UBC Plc is a multinational conglomerate involved in the manufacture and distribution of computer hardware accessories, networking hardware and allied products. With experience spanning four decades in the industry, the company’s products enjoy a lion’s share of the market. As part of its diversification strategy aimed at sustaining its competitive advantage, the company intends to start the production of GSM phones, targeting the mass market in the country.
The company plans to control at least 40% of the low-end GSM phone market in the country in the next five years.
UBC Plc possesses the requisite human resources and physical facilities necessary for the successful takeoff and growth of the new venture. The company also intends to leverage its extensive distribution network for its IT products covering major cities within the West African sub-region to distribute its new GSM phones.
The company also has modern equipment which can easily be converted into the production of GSM phones at little cost without significantly affecting the current production levels of other products. When this is done, the equipment will be able to produce more than 5 million GSM phones per annum.
While the company intends to expand its production capacity radically within the first few years of manufacturing GSM phones, it is still struggling to cope with the country’s incessant electric power failure which has made the company rely almost exclusively on the use of generators to power its equipment. This constitutes the bulk of its overhead costs.
The firm has signed a Memorandum of Understanding with a group of reputable firms abroad, which guarantees a steady supply of all required components and inputs.
The current value of the annual GSM phone demand in the country is estimated at N520 billion. Estimated demand growth rate is put at 5%. There is currently no local producer, as all of the GSM phones in the market are imported. However, there is currently a large number of local firms that act as distributors to foreign producers.
Except for regulations aimed at ensuring that only high-quality products are manufactured, there are currently no legal restrictions on local production of GSM phones. Furthermore, to encourage manufacturing, the government offers tax holidays to all manufacturers in the first five years of operation.
The estimated cost per unit of GSM phones designed for the mass market in the country is put at N8,000 while the current average price stands at N10,000.

Required:
a.
(i) A business environment analysis using SWOT and PESTEL analyses. (10 Marks)
(ii) A competitive analysis using the Porter’s Five Forces Model. (15 Marks)

b. Advise on Kant’s categorical imperative. (5 Marks)

Answer

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Tags: Business Strategy, Categorical Imperative, Kant, Market Entry, PESTEL, Porter’s Five Forces, SWOT
Level: Level 2

Topic: Environment analysis
Series: MAY 2019

CSEG – Nov 2018 – L2 – Q6 – Strategic alternatives, analysis and selection

Discuss the challenges and strategies involved in Franko Ltd’s acquisition of a Nigerian accounting software company.

Question

Franko Ltd is a producer of accounting software for SMEs. The software is very easy to use, even for a layperson, and has significant functionality for the price level of GH¢4,959 per annum. The package includes all functionality to comply with tax payments, including income tax, (PAYE) and VAT, as well as creditor and debtor accounting and some customer relationship management functions. The firm also has an enhanced package that includes telephone support and free updates for GH¢499 per annum.

Franko Ltd has been very successful, and this has led the firm to expand internationally, after starting and developing a business over the past five years, mostly in Accra, Ghana. Franko Ltd has decided to expand into the African market and has chosen to enter the Nigerian market by acquiring a Nigerian accounting software business as an entry route into that market, as it is perceived to be different from the Ghanaian market.

Required:

a) Explain FOUR (4) challenges Franko Ltd may face in the acquisition. (8 marks)

b) Advise Franko Ltd on how to effectively address the challenges they may face in planning and completing such an acquisition. (12 marks)

Answer

Find Related Questions by Tags, levels, etc.

Tags: Acquisition Challenges, Business Acquisition, International Expansion, Market Entry, Strategic Management
Level: Level 2

Topic: Strategic alternatives, analysis and selection
Series: NOV 2018

CSME – Nov 2015 – L2 – Q7 – Corporate Strategy Formulation

Analyzes reasons for slow growth in DAB phone sales, uses the S-shaped growth curve to evaluate market stages, and suggests sales improvement strategies.

Question

Answer

Find Related Questions by Tags, levels, etc.

Tags: Market Entry, Product Development, S-shaped Growth Curve, Sales Strategy
Level: Level 2

Topic: Corporate Strategy Formulation
Series: NOV 2015

CSME – May 2019 – L2 – Q1 – Environmental Analysis

Prepare a business environment and competitive analysis for UBC Plc's intended investment in GSM phone manufacturing using SWOT, PESTEL, Porter’s Five Forces, and Kant’s categorical imperative.

Question

UBC Plc is a multinational conglomerate involved in the manufacture and distribution of computer hardware accessories, networking hardware and allied products. With experience spanning four decades in the industry, the company’s products enjoy a lion’s share of the market. As part of its diversification strategy aimed at sustaining its competitive advantage, the company intends to start the production of GSM phones, targeting the mass market in the country.
The company plans to control at least 40% of the low-end GSM phone market in the country in the next five years.
UBC Plc possesses the requisite human resources and physical facilities necessary for the successful takeoff and growth of the new venture. The company also intends to leverage its extensive distribution network for its IT products covering major cities within the West African sub-region to distribute its new GSM phones.
The company also has modern equipment which can easily be converted into the production of GSM phones at little cost without significantly affecting the current production levels of other products. When this is done, the equipment will be able to produce more than 5 million GSM phones per annum.
While the company intends to expand its production capacity radically within the first few years of manufacturing GSM phones, it is still struggling to cope with the country’s incessant electric power failure which has made the company rely almost exclusively on the use of generators to power its equipment. This constitutes the bulk of its overhead costs.
The firm has signed a Memorandum of Understanding with a group of reputable firms abroad, which guarantees a steady supply of all required components and inputs.
The current value of the annual GSM phone demand in the country is estimated at N520 billion. Estimated demand growth rate is put at 5%. There is currently no local producer, as all of the GSM phones in the market are imported. However, there is currently a large number of local firms that act as distributors to foreign producers.
Except for regulations aimed at ensuring that only high-quality products are manufactured, there are currently no legal restrictions on local production of GSM phones. Furthermore, to encourage manufacturing, the government offers tax holidays to all manufacturers in the first five years of operation.
The estimated cost per unit of GSM phones designed for the mass market in the country is put at N8,000 while the current average price stands at N10,000.

Required:
a.
(i) A business environment analysis using SWOT and PESTEL analyses. (10 Marks)
(ii) A competitive analysis using the Porter’s Five Forces Model. (15 Marks)

b. Advise on Kant’s categorical imperative. (5 Marks)

Answer

Find Related Questions by Tags, levels, etc.

Tags: Business Strategy, Categorical Imperative, Kant, Market Entry, PESTEL, Porter’s Five Forces, SWOT
Level: Level 2

Topic: Environment analysis
Series: MAY 2019

CSEG – Nov 2018 – L2 – Q6 – Strategic alternatives, analysis and selection

Discuss the challenges and strategies involved in Franko Ltd’s acquisition of a Nigerian accounting software company.

Question

Required:

a) Explain FOUR (4) challenges Franko Ltd may face in the acquisition. (8 marks)

b) Advise Franko Ltd on how to effectively address the challenges they may face in planning and completing such an acquisition. (12 marks)

Answer

Find Related Questions by Tags, levels, etc.

Tags: Acquisition Challenges, Business Acquisition, International Expansion, Market Entry, Strategic Management
Level: Level 2

Topic: Strategic alternatives, analysis and selection
Series: NOV 2018

Question Tag: Market Entry

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CSME – Nov 2015 – L2 – Q7 – Corporate Strategy Formulation

Analyzes reasons for slow growth in DAB phone sales, uses the S-shaped growth curve to evaluate market stages, and suggests sales improvement strategies.

CSME – May 2019 – L2 – Q1 – Environmental Analysis

Prepare a business environment and competitive analysis for UBC Plc's intended investment in GSM phone manufacturing using SWOT, PESTEL, Porter’s Five Forces, and Kant’s categorical imperative.

CSEG – Nov 2018 – L2 – Q6 – Strategic alternatives, analysis and selection

Discuss the challenges and strategies involved in Franko Ltd’s acquisition of a Nigerian accounting software company.

CSME – Nov 2015 – L2 – Q7 – Corporate Strategy Formulation

Analyzes reasons for slow growth in DAB phone sales, uses the S-shaped growth curve to evaluate market stages, and suggests sales improvement strategies.

CSME – May 2019 – L2 – Q1 – Environmental Analysis

Prepare a business environment and competitive analysis for UBC Plc's intended investment in GSM phone manufacturing using SWOT, PESTEL, Porter’s Five Forces, and Kant’s categorical imperative.

CSEG – Nov 2018 – L2 – Q6 – Strategic alternatives, analysis and selection

Discuss the challenges and strategies involved in Franko Ltd’s acquisition of a Nigerian accounting software company.

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CSME – Nov 2015 – L2 – Q7 – Corporate Strategy Formulation

Analyzes reasons for slow growth in DAB phone sales, uses the S-shaped growth curve to evaluate market stages, and suggests sales improvement strategies.

You're reporting an error for "CSME – Nov 2015 – L2 – Q7 – Corporate Strategy Formulation"

CSME – May 2019 – L2 – Q1 – Environmental Analysis

Prepare a business environment and competitive analysis for UBC Plc's intended investment in GSM phone manufacturing using SWOT, PESTEL, Porter’s Five Forces, and Kant’s categorical imperative.

You're reporting an error for "CSME – May 2019 – L2 – Q1 – Environmental Analysis"

CSEG – Nov 2018 – L2 – Q6 – Strategic alternatives, analysis and selection

Discuss the challenges and strategies involved in Franko Ltd’s acquisition of a Nigerian accounting software company.

You're reporting an error for "CSEG – Nov 2018 – L2 – Q6 – Strategic alternatives, analysis and selection"

CSME – Nov 2015 – L2 – Q7 – Corporate Strategy Formulation

Analyzes reasons for slow growth in DAB phone sales, uses the S-shaped growth curve to evaluate market stages, and suggests sales improvement strategies.

You're reporting an error for "CSME – Nov 2015 – L2 – Q7 – Corporate Strategy Formulation"

CSME – May 2019 – L2 – Q1 – Environmental Analysis

Prepare a business environment and competitive analysis for UBC Plc's intended investment in GSM phone manufacturing using SWOT, PESTEL, Porter’s Five Forces, and Kant’s categorical imperative.

You're reporting an error for "CSME – May 2019 – L2 – Q1 – Environmental Analysis"

CSEG – Nov 2018 – L2 – Q6 – Strategic alternatives, analysis and selection

Discuss the challenges and strategies involved in Franko Ltd’s acquisition of a Nigerian accounting software company.

You're reporting an error for "CSEG – Nov 2018 – L2 – Q6 – Strategic alternatives, analysis and selection"

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