If we consider the external environment of the company by looking at the international business concept so the threats will be the increase in cost due to the increasing corporate taxes and the increasing infrastructure cost which is resulting due to the production unit in Japan as it is costing more than its competitors which are producing in Korea and are enjoying a relatively lower cost of production. Company is facing a major threat which is a disadvantage for Sharp Corporation is that the exchange rate is fluctuating quickly and rapidly which is resulting in the currency risk for the company which is faced by its competitors well. Moreover, higher cost of transportation is also creating a disadvantage for the company as they are using expensive medium of conveyance such as sending quick deliveries by airline and the easy and cheap mediums used by the competitors are creating a big threat for the company. Increasing competition is creating threat for the company and maintaining the operations globally for component and final products is really problematic for Sharp corporations. Biggest threat is the strategic partnership by its competitors which results in the weaker performance of company and its revenue growth is decreased as compared to its competitors.
However, as far as the opportunities for the company is concerned, sharp corporation has to enter into the strategic partnership with other countries such as Chinese companies which will be a joint venture between both companies. Moreover, they have the opportunity to grow their sales by maximizing their profits and expertise of its Joint Venture Company Sony which has the expertise in TVs. Moreover, Sharp Corporation has an opportunity to grow its product line and sales of Panels which are of high quality and its rapid growth in demand. Company has opportunity to fulfill increasing demand in emerging markets as well.
The problems which company is facing are very severe and it needs appropriate alternatives after analyzing the pros and cons of all the alternatives. Two alternatives which have been selected after diagnosing the whole situation and possible alternatives.
First alternative which has been selected consists of reducing the competition with Sony, Samsung and LG rather than involving itself by forming strategic alliances with them. The strategy consists of the diversifying its Global presence through market development strategy by going for the geographical expansion with its current hit products such as LCDs and high quality panels through effective and heavy sales promotions and marketing campaigns internationally to capture the market share over there as well. Advantage of this alternative will be the sales growth by capturing the new geographical markets and increase in the number of potential customers. Whereas, its disadvantage is concerned, Sharp Corporation may face the problem to enhance its market share and control its production cost by expanding globally and it may not match with the growth in sales whereas this disadvantage can also result in the advantage for the company if the company is able to enhance its profits and pay back their liabilities which will reduce the finance cost for them………….
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