Question

In this assignment, students are required to write a report and do a presentation on a new business management practice. They need to analyse the selected Business to come up with answers for the following questions:

• Name and introduction of the Business

• Size of the business and Product Features

• What are the capital sources for the new business and how they are obtained?

• What are the challenges and difficulties that might be expected for the example business? You need to discuss any possible problem such as legal, technological, political, economic, environmental, social and cultural challenges.

• How are the potential risks involved in the process of the example business venture?

• Provide Management practices you will be implementing to minimise or eliminate the problems/issues you have or might have in the future.

• Recommendation

• Conclusion

Answer 1

Businesses like Samsung spresd across globally have seen huge challenges and impediments.

The business size is into trillions of dollars and belongs to oligopoly structure or perfect competition structure based on different geographical locations into smartphone categories.

Capital sources majorly are through debt funding like corporate bonds and debentures and offer for sale while equity diluting is another option for fundraising.

Five Forces Analysis:

Bargaining power of Suppliers - Many suppliers in this segments offer low cost services which means bargaining power is less for suppliers.
Bargaining power of buyers- Sijce Samsung operates either in perfectly competitive market or Oligopolistic market across globe, buyers have higher choices and hence higher power.
Threat of New Entrants- Since new entries from lowcost Chinese providers can eat up Samsungs share due to ease of taxation and licensing, threat is higher substantially.
Threat of rivalry between existing firms- This is comparatively very high as margins are wafee thin and innovation is constantly evolving making it difficult for the industry as whole.
Barriers to entry- Large initial investment, high marketing and distribution spends, constant innovation are biggest barriers.





PESTLE Analysis :

Political - India, South and North Korea ar emost errant markets with high taxation and compliance and warfare tensions.
Economic - global economic degrowth and stagnant growth in mature markets is cause for worry.
Socio cultural - changing consumers preference and strong core culture is what Samsung has coped up with and reoriented itself across global markets to stay ahead of curve.
Technological - Wide-spread innovative solutions from competitors like Apple, Huawei, Vivo, Oppo, Xiaomi have threatened Samsung and portfolios. However Samsung has been fast mover and easily stays ahead of curve with its unparalleled premium segment and upscale technologies which competitors match too lately.
Legal- the recall of Samsung S9 has been highest litigation based loss because of malfunctioning and lack of quality checks and also copyright infringement issues with Apple make it very cumbersome and difficult to deal with.
Environmental - the organisations has been keen ethical player and truly abides environmental laws.

Potential risks:

Strengths

Global brand image
Economies of scale and cost leadership
Highest patent growth
Innovation and design capability

Weakness

High dependent on OEM
Product cannibalization due to less differentiation
Focus majorly on high prices and premium segment

Opportunity

Tieups with Telecommunications operators for handset SIM selling
Focus on rural markets
Focus on low price segment
Focussing on diversified products like smartwatches, IoT products, Smart sensors, Smart devices

Threat

Chinese products and hypercompetition
Uncertainty in government policies
High taxation
Retail markets collaboration with low cost players and private labels.

Recommendations and Conclusions

Samsung thus needs strong diversification into new segmentation and divestment of non performing business to achieve cost synergies and profits maximisation.

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