Midea Electronics Essay Example | Topics and Well Written Essays - 3500 words

Midea Electronics - Essay Example Midea attained RMB8 billion revenue for fiscal year 1999 and has set a sales objective of RMB38.6 billion by year 2005. Although Midea has a leading position in air conditioner exports from China and shown a continuous growth in domestic and international market yet with globalization and rapidly changing business scenario, Midea is facing a number of challenges both in domestic and international market. As for major appliances manufacturers are concerned, Asia, and in particular China seems to be with the most potential growth market and hence they are aggressively investing in Chinese domestic market. Almost all major appliances manufacturers are present in the Chinese market either by setting their manufacturing facilities or by establishing the off shore base centers. Compared to these major players, Midea lacks its presence in international market with its brand name and it has to solely rely on its importers brand name. It does not have a well defined global marketing strategy and a more geographical diversified presence with better marketing skills and dedicated international sales and distribution networks. Also major international players like LG (with 74% revenue from international market), Samsung Electronic (66%), Mitsubishi (51% by 2001), Fedders (50%), Carrier (48%) and Sharp and Whirlpool (each with 46%) have immense financial resources with latest technology and state-of-the-art innovation research centers while Midea only generates 10% of its revenue from international market and has limited financial resources, with traditional technology. ... Also major international players like LG (with 74% revenue from international market), Samsung Electronic (66%), Mitsubishi (51% by 2001), Fedders (50%), Carrier (48%) and Sharp and Whirlpool (each with 46%) have immense financial resources with latest technology and state-of-the-art innovation research centers while Midea only generates 10% of its revenue from international market and has limited financial resources, with traditional technology. Moreover the scenario will become more intensive and competitive with the China's imminent entry into World Trade organization (WTO). These are really major concerns to Midea's management team. As in changing global business scenario, any competition can not be viewed as solely domestic and every organization have to defend its position and have to play a double edge knife role to compete both at domestic and global level. For long term business viewpoint Midea too has to play the same role. Being a major domestic player it has to defend its position in Chinese market and also has to show its presence in the international arena. To achieve this Midea has to review its international business strategy and to go for both branding and private label options. In coming sections we will analyze the Midea's strengths and weaknesses relative to domestic and international competitors. Also an assessment of relative attractiveness of domestic and international markets for air conditioners is presented. Finally an international business strategy is recommended to enter and capture market share. Media Group: An Overview Midea was established in April 1968, in Shunde, Guangdong, the southern Chinese province bordering Hong