Dorchester Inc. Takeovers

Dorchester Inc. Takeovers

Introduction

Dorchester, Inc is a U.S based conglomerate which has the intentions of expanding its operation to international levels. Recently there has been a trend by its competitors to expand their operations internationally. This is what has prompted the decision by the management of Dorchester, Inc to follow their competitors. Through this international expansion Dorchester, Inc will gain a competitive advantage over its competitors. The particular area of expansion that is targeted by Dorchester, Inc is consumer electronics. The conglomerate has indicated their interest in purchasing companies that specialize in consumer electronics in three countries that will be identified (Prodi, 2010).

The management of the conglomerate has a task of determining the potential countries where they can purchase the companies. Before settling on the countries they will expand into the management will have to conduct an economic assessment of these countries. The management will further conduct an economic assessment of the specific companies they will have identified from the three countries. This assessment seeks to determine the potential pros and cons of buying a company that is based in each of the three countries. The entire assessment that is carried out by the management entails an analysis of Dorchester’s external environments. There are many countries that have companies which specialize in production of consumer electronics. Therefore Dorchester, Inc has a wide variety to choose from however they lower their choices down to three countries which are South Africa, Japan and China.

South Africa

There are various consumer electronics companies in South Africa. South Africa is a good country to be explored by Dorchester, Inc due to various reasons. These are such as the thriving of new technologies. Within South Africa, old technology like analog TV is seen to be disappearing meaning that the country is up to speed with the current technological advancements that are taking place. The new technology that is found in South Africa is performing quite well and accelerating at a high rate. Technology in South Africa is closely behind that of developed countries. This means that if Dorchester Inc explores into south Africa they will be sure that the consumer electronics provided by the company is the latest technologically. The uptake of new technology is very good since many people within South Africa are responding positively to the new technology. This means that the conglomerate will continue being competitive in the market both in South Africa and the rest of the world. Another advantage of exploring into South Africa is the fact that there is an increased growth in telecommunication market .This means that if Dorchester, Inc buys a company within South Africa they will be sure of a ready market for telecommunications products such as smart phones.

There are also some disadvantages if Dorchester decided to buy consumer electronics company in South Africa. These disadvantages are such as the fact that rescents reports show that there is poor performance in a majority of the consumer electronics products. There has seen a slowdown in consumer spending and hence the industry is currently under intense pressure. This is due to the fact that people in South Africa often regard the consumer electronic products as being inessential .Therefore it might not be wise of Dorchester to invest in South Africa since there a lot of uncertainties when it comes to the patterns of purchasing these products. Generally South Africa is a good option for the conglomerate to venture into. I believe that the country has a lot to offer and it will be a wise decision to buy a consumer electronic company from there.

Japan

There are many consumer electronics companies in Japan that have been in existence for sometime.Japan has been dominating the consumer electronic industry for a very long time. There are various advantages that Dorchester has if it invests into Japan .first consumer electronic products from Japan remain dominant not only in Japan but in the rest of the world. For instance Sharp corp, a company in Japan was a leader in the Japanese consumer electronics in 2011.Apart from this Panasonic corp another consumer electronic company in Japan also registered a success story (Hays, 2009). These companies offer a wide range of products both locally and internationally. This means that if Dorchester buys one of these companies they will have a lot to offer in Japan and the rest of the world.

There are also retailers who specialize in electronic and appliance that help the consumers in Japan when they want to access the consumer electronics products. These specialists have gained a higher purchasing power as well as clear pricing advantages over channels which were used before such as mass merchandisers. There are specialists such as Edion and Yamada Denki who have had a good performance especially when it comes to the provision of customer service. A disadvantage of the consumer electronic business in Japan is that the consumer electronics are still sluggish due to lack of enough stimulation to the industry by relevant stakeholders. There is low demand for some products whose market is exhausted since almost everyone in the country has purchased them. Despite this disadvantage Japan is still a good country for investment by Dorchester Inc.

China

Chins has been known as a producer of electronic products for a very long time. Most of the consumer electronics are produced in China eventually sold in other countries. Many countries have invested in China due to the potential that exists when it comes to consumer products. Advantages that Dorchester has if they invest in China are a healthy growth in the consumer electronics that is expected to take place as forecasted. Consumer electronics are still expected to continue record volume growth. This is facilitated by the continued growth in the economy as well as an increase in the demand for consumer electronic products. This means Dorchester will really benefit if it buys a company in china as the economy in china is on a record high. There is also an increase in internet retailing in china. Most of the sales in Japan are now made through the internet. This means that the products in china have market not only in china but also the rest of the world. The adoption of selling through the internet is advantageous to Dorchester incase it decides to buy a company in china .this is because they will have a market all over the world ( Euromonitor , 2012).This is due to the fact that the internet is a wide and open market place. There are also new technology and rising innovations in the consumer electronics. These developments have resulted to the growth of consumer electronics in China. The growths of retail sales that are made from the consumer electronics are very strong. The consumer electronics industry is enjoying a strong value in their sales particularly in products that have emerged such as smart phones and tablets. These factors show that China is a good country for Dorchester to invest into in the consumer electronic industry.

Conclusion

It is a clear indication that all the three countries that have been discussed above have a great investment opportunity to offer for Dorchester Inc. Therefore, there should not be any hesitation by the management of the conglomerate to invest in these countries. If they do so then they will gain a competitive advantage and its presence will be felt not only in U.S.A but to the rest of the world as well.

References

Hays,J.(2009).Japanese electronics companies.Retrieved April 16,2013 from http://factsanddetails.com/japan.php?itemid=920&subcatid=157Euromonitor(2012). Consumer Electronics in South Africa Retrieved April 16,2013 from http://www.euromonitor.com/consumer-electronics-in-south-africa/reportEuromonitor .(2012). Consumer Electronics in China. Retrieved April 16,2013 from http://www.euromonitor.com/consumer-electronics-in-china/reportProdi,R.(2010). Expanding your business outside your country? Expand your cultural awareness as well.Retrievd April 16,2013 from http://thepolishedprofessional.wordpress.com/2010/10/07/expanding-your-business-outside-your-country/