Grieve company: A Case Study

Résumé du document

According to the case, what are the reasons why the company was not willing to internationalize?
Grieve was not ready to internationalize because of three major reasons:

- The first was about the nature of its product. Exporting industrial ovens and furnaces all over the world has a cost. Grieve's view point was simple they thought that the shipping costs could be to important compared with the price of their products. Moreover their price could not be competitive with others local companies by consequences they pushed themselves out of the market.

- The second was a doubt concerning their chance of success abroad. The company "knew they lacked the resources needed to support a successful export program". The big issue was to know if it was a good strategy to expand their organization whereas they had enough work in their local market.

Extraits

[...] Their principal weakness concerned the shipping costs that the company had to reduce to export toward Asia. The company also had to arrange products to the local markets with instructions for use in the local languages and adapt the product size to Asian market. Moreover the company was not on site to negotiate directly with future clients by consequences they had to make their local promotion by themselves because it had a more important impact and it develops credibility for the company abroad. [...]

[...] Various elements made Grieve Company change their mind. The first concerned the growing competition on local markets by consequences they had to invest in research and development and develop new products and new selling strategies for the same market. This growing competition would have for consequences to increase the cost of production and in the other hand it could reduced their margin profit because they would have adapt their price to their competitors. Considering that Grieve did not want to lose market share they decided to internationalize their activity. [...]

[...] Moreover their threat was to be able to develop the company in order to be able to respect orders and delivery delays and in the same time the company had to control cost in order to not reduce his profit margin. If the weaknesses and threats were poorly managed the consequences would have been fatal to the company because Grieve would have forgotten to check their profit margin and anticipate too many orders by consequences they had to implement a day to day management in order to be ready to their international development Critically discuss the 10 lessons Calabrese proposes to export successfully The ten lessons Calabrese proposes seem to be highly relevant in an international context. [...]

[...] The representative helped the company by two ways. The first way concerned the export assistance by helping in U.S regulations, bank and government help. The second way was an assistance to understand local culture and prepare the trip toward Southeast Asian countries by organizing meetings with local embassies, Grieve and local companies. The aim was to give the better hand possible to Grieve in order to penetrate the market. After that the company Calabrese made a trip to ASEAN countries in order to determine market potential and recruiting possible sales representative. [...]

[...] & in Asia? Grieve's general competitive advantages concern competencies in meeting any customer's particular requirements to prove that their slogan is “more than manufacturers but, rather, problem solving professionals who take the time to understand your needs”. Grieve competitive advantage is their capacities to develop adapt products for all clients and they guarantee a qualitative after sales service. Moreover one of their general advantages is their reactivity because all their offices are group together which has for consequences to improve their reactivity and their quality checking because the Headquarter, sales department, engineering department and the research department are on the same site and work closely together. [...]