Choosing Strategy for Samsung

Galaxy Series in Myanmar

MU NWET KHINT ZAW
HND-1262
BUSINESS STRATEGY
ASSIGNMENT 2

Content
Possible alternative strategies
An appropriate future strategy for Samsung

Electronics

Possible A alternative strategies

PART A

Market Entry Strategies

There are numerous market entry strategies that a business can

adopt when setting up offshore. Each has differing levels of risk,

legal obligation, advantages and disadvantages.
Organic
growth

growth

by merger or acquisition

strategic alliances

licensing

franchising

Organic Growth
Organic growth is the process of business expansion due

to increasing overall customer base, increased output per

customer or representative, new sales.

Organic Growth
Advantages

Disadvantages

Reduce or eliminate price

Slower entry mode

escalation caused by transport

costs, customs, duties, etc
Guarantee availability of
goods to resellers, minimizing
potential conflicts over
allocation decisions and
eliminating delays
Ensure more uniform quality
Adapt products for local
requirements

Increased risk exposure with

the resource commitment on

the scale usually required
Political risks repatriation
of profits etc
Potential problem if there are
country of origin issues
negative impact if
manufactured in a low wage
country

Growth by merger or acquisition

Growth by acquisition is a tried and trusted strategy that

allows you to move into new markets

Companies hit the mergers acquisitions trail for a host of

reasons.

Growth by merger or acquisition

Advantages

Disadvantages

Decreased time to access and

Increased risk may be a large

penetrate target market as the

financial commitment but faces

existing company already has a

political and market risks

product line to be exploited and a

distribution network
Prevents an increase in the number

of competitors in the market

Overcome entry barriers including

restrictions on skills, technology,

materials supply and patents

Poor or slow post-merger integration

Target too large or too small
Overly optimistic appraisal of

synergies
Overestimation of market potential
Inadequate due diligence
Incompatible corporate cultures

Strategic Alliances
An arrangement between two companies that have decided

to share resources to undertake a specific, mutually

beneficial project.
each company maintains its autonomy while gaining a new

opportunity.
It could help a company develop a more effective process,

expand into a new market or develop an advantage over a

competitor, among other possibilities.

Strategic Alliances
Advantages

Disadvantages

Technology exchange

exchange resources and capabilities

Global competition
Industry convergence

such as technology.

Using investment initiative to erode the

other partners competitive position.

Economies of scale and reduction

of risk

The partnership may be forged to

Strengths gained by learning from one

company can be used against the other.

Alliance as an alternative to merger

Firms may use alliances to acquire its

partner.

international franchising
A system in which semi-independent business owners

(franchisees) pay fees and royalties to a parent company

(franchiser) in return for the right to become identified
with its trademark, to sell its products or services, and often
to use its business format and system.

international franchising
Advantages of the international
franchising mode:

Disadvantages of the international

franchising mode:

Low political risk

Franchisees may turn into future

Low cost
Allows simultaneous expansion

into different regions of the world

Well selected partners bring

financial investment as well as

managerial capabilities to the
operation.

competitors
Demand of franchisees may be
scarce when starting to franchise a
company
A wrong franchisee may ruin the
companys name and reputation in
the market
requires a greater financial
investment to attract prospects and
support and manage franchisees

Licensing
An international licensing agreement allows foreign firms,

either exclusively or non-exclusively to manufacture a

proprietors product for a fixed term in a specific market.
Summarizing, in this foreign market entry mode, a licensor

in the home country makes limited rights or resources

available to the licensee in the host country.

Licensing
Advantages

Disadvantages

Obtain extra income for technical

Lower income than in other entry

know-how and services

Reach new markets not accessible by
export from existing facilities
Quickly expand without much risk
and large capital investment
Pave the way for future investments
in the market
Retain established markets closed by
trade restrictions
Political risk is minimized as the
licensee is usually 100% locally
owned
Is highly attractive for companies
that are new in international
business.

modes
Loss of control of the licensee
manufacture and marketing
operations and practices leading
to loss of quality
Risk of having the trademark and
reputation ruined by an
incompetent partner
The foreign partner can also
become a competitor by selling
its production in places where
the parental company is already
in.

Myanmar Mobile Economy

Event

Mobile-phone access for ordinary citizens in Myanmar is set to

expand.

The sale comes as the government moves towards a decision

in June to allow two international wireless players to enter the
last untapped mobile-phone market in South-east Asia, a
tender that drew intense interest from a wide swathe of
telecommunications companies and investors.

Choosing Strategy for Samsung

According to the marketing entry methods, Samsung

should choose organic growth or /and franchising methods

in Myanmar.
Samsung can reduce cost for using these methods because

there is no need to invest in Myanmar.

It is only need to control for dealers in Myanmar and taking

good care of customers.

Analysis
The cost of mobile access in Myanmar, where penetration is

estimated to be less than 10%, has already dropped

still very expensive by international standards and out of

reach for many Burmese citizens, particularly when the cost

of a phone is factored in.
It can also be complicated, and getting online with a

mobile device remains costly.

An appropriate future strategy for

Samsung Electronics

PART B

Strategy Evaluation
Suitability

Myanmar is now suitability for new Market because Myanmar

is now changing for politic and economic growth.

Feasibility

Now Samsung ready to come Myanmar according to it

financial, Human resources and technology .

Strategy Evaluation
Acceptability to stake holders

It related to peoples expectation on Samsung

Financial Consideration
Samsung is a global company

Customers
Samsung need to find Myanmar customers need and want.

Banks
Myanmar Banks are now changing online Banking System.

Government
Myanmar Government are now really welcome for Foreign big
companies for investment.

The Public
Myanmar people are now changing better life style.

Risk
Different shareholders have different attitudes to risks.

Market Strategy for Samsung

Samsungs clever marketing strategies played an important role

in Myanmar
from that of a low-end manufacturer to that of a global digital

technology leader.
For effective global marketing and branding, Samsung

established a new organization to deal with its integrated global

marketing activities.

Choosing Product Market Strategy

Market Penetration
Market penetration is the name given to a growth strategy where an

organization focuses on selling existing products to existing markets.

It applies to selling an existing product in an existing market. It is

suitable in growing market which is as yet not saturated.

Penetration of the market can be achieved by

attracting new customers for the product

Increasing the usage, or purchasing rate, of existing customers.

Market Development
It is used when a regional business wants to expand, or

when new markets are opening up, or when a new use is

found for the existing product.
market development is based on the premise that the

business is already operating successfully.

Geographic expansion may involve changing from local to

regional to national operation.

Product Development
Its involves developing new products to sell in existing

markets.
Usually employed with branded goods.
It builds on customer loyalty

diversification strategies
advantage of preventing a company from relying too much on its

existing SBUs.
It can be a means of growth and expansion of power, and can act

as insurance against potential disasters.

Each of the Strategic directions needs decision and careful

analysis in order to determine their viability in the short,

medium and long terms before a strategic choice is making. .

Choosing Samsung Business Strategy

According the market growth strategy , Samsung should use

organic growth in Myanmar Market with lot of distribution

channels.
Samsung should use Market Development sector in Myanmar for

product Market Strategy.

Samsung should get a lot main of local big mobile players in

Myanmar Market. It is really effectiveness for Samsung Market

growth in Myanmar.

Conclusion
Samsung must take control of several areas of its mobile

business in Myanmar, and a few recent moves tip that it's

well on its way.
Samsung should get good relation with dealers in

Myanmar.
Samsung should the reasonable prices.
Samsung should do a lot of marketing and branding

activities in Myanmar.

References
Samsung widens business in Myanmar - The Nation. 2013.

Samsung widens business in Myanmar - The Nation.

[ONLINE] Available at:
http://www.nationmultimedia.com/aec/Samsung-widensbusiness-in-Myanmar-30188809.html. [Accessed 14 May
2013].

References
SAMSUNG Ireland. 2013. SAMSUNG Ireland. [ONLINE]

Available at: http://www.samsung.com. [Accessed 21 May

2013].
BPP Business Strategy Book (2010)