HAIER’s foray into International Markets :

In the late 1990s, the Haier group (Haier) was the leader in the Chinese consumer appliances market (with a 39.7%, 50% and 37.1% market share in refrigerators, air-conditioners and washing machines respectively in December 1998). But deflation in the Chinese economy slowed sales.

ut deflation in the Chinese economy slowed sales growth from 50% in 1998 to around 30% in 1999. Haier decided to look for new markets. Since the US had a large demand for consumer appliances, Haier entered the US market in 1999. Analysts were doubtful about Haier's acceptability to American consumers, as there was a general perception in the US that Chinese goods were of low quality. Haier, however, was confident that with its product differentiation strategy it would be able to create a positive image for its products among the American public. In the early 2000s, the consumer appliances market in the US started hotting up as Haier entered the market. By 2009, Haier products were sold in 9 of the 10 top retail chains in the US.

With Wal-Mart agreeing to stock Haier products, many analysts believed that Haier would be able to shake up the US consumer appliances market. In 2009, Haier had a 6% market share in the US refrigerator market; it stated that it was aiming for a 15% market share by 2015.

The history of Haier dates back to 1984 when Ruimin Zhang (Zhang), a bureaucrat with the local government was asked to take charge of Qingdao General Refrigerator Factory, a state-owned enterprise that is manufacturing refrigerators for sale in China. When Zhang took over the management, the company was on the brink of bankruptcy, with no funds to pay the salaries of its employees or to invest in new product development. When Zhang took charge of the company, he realized that the company did not look after the quality of its products; nor did it bother about customer satisfaction. In 1985, Zhang started importing technology from a German firm and began manufacturing technically sophisticated refrigerators.

Zhang emphasized the elements of customer satisfaction and quality control in the company. In 1985, when a customer complained about the poor performance of his refrigerator, Zhang conducted a quality check and found that out of 400 refrigerators inspected, 76 were defective.

He had all the defective refrigerators destroyed with a sledge-hammer. According to Zhang, this made the workers realize that quality is of only two types - acceptable and unacceptable. In 1989, the company changed its name to Qindao Refrigerator Co. Ltd., and it was restructured with funds raised from banks and government agencies. In 1991, the company once again changed its name to Qindao Haier Group Co. and in the same year it merged with Qingdao Air-conditioner Plant and Qingdao Freezer General Plant. In 1992, the company set up Qingdao Freezing Equipment Co. In the same year, it merged with another previously state-owned enterprise Qingdao Condenser Factory, which manufactured refrigerator condensers.

In the same year it became the first company in China to get ISO 9001 certification, and the company's name was changed to the Haier Group. In 1993, Haier went in for an IPO of RMB 50 million and got listed on the Shanghai Stock Exchange (SSE).

During the mid-1990s, Haier began to grow through mergers and acquisitions. In 1995, it merged with Red Star Electric Appliance Company (and five of its subsidiaries). This company manufactured washing machines. It also acquired Wuhan Elec-appliance Co., which manufactured freezers and air conditioners. Between 1995 and 1997, Haier acquired seven companies and started exporting its goods to foreign markets.

By 1997, Haier was the number one consumer appliances brand in China and the market leader in all its product segments, which included refrigerators, washing machines, microwave ovens and freezers and its revenues were reported at $1.15 billion (10 billion Yuan)...

Haier's Competitors in the US Market

USA was the world's largest and most competitive market for consumer appliances. The consumer appliances market can be segmented on the basis of products into kitchen appliances and home comfort products. Included in kitchen appliances are products such as dishwashers, disposers, compactors, food preservation appliances, refrigerators, freezers etc.

In the home comfort segment are included products such as room air-conditioners and dehumidifiers. The home appliances market in the US was dominated by American companies, namely GE Appliances (a subsidiary of General Electricals), Whirlpool and Maytag. The only strong foreign player in this market was Sweden's Electrolux. GE Appliances, Whirlpool, Maytag and Electrolux together accounted for around 98% of the 9 million standard refrigerators sales in the US every year. In the 1990s, many Asian players such as LG Electronics and Samsung entered the US market in a big way. The big four companies in the US market concentrated on the high- end market comprising full-size refrigerators and washing machines, since the margins in this segment were high...

Strategies in the US Market

Haier decided to compete with the US brands on the quality plank rather than on price. However, analysts felt that it would be very difficult for the company to win over American consumers who associated Chinese goods with low quality. To strengthen its presence in the US market, Haier adopted a localization strategy.

It opened a design center in the Los Angeles and employed US designers for designing its products for the US market. Haier also opened a marketing center in New York. The company focused on enhancing consumer awareness about the company and its products. Commenting on Haier's strategy, Zhang said, "We want consumers to feel that Haier is the one company that comes closest to satisfying their needs." For instance, none of the consumer appliances companies in the US offered a compact refrigerator to satisfy demand from college students who could not afford normal size refrigerators...

Going High-End

Most analysts felt that Haier would feel the real competition only when it entered the high-end market. In the compact refrigerator segment, Haier did not face much competition from established players in the US, who did not focus on the low margin segment.

However, the major US players were keeping track of Haier's activities. Commenting on the competition from Haier, GE Appliances Chief Executive, Jim Campbell said, "I take it very seriously. They may be producing only 200,000 refrigerators per year now, but that's going to get bigger."

On the negative side, some analysts felt that Haier lacked the brand image to make a dent in the high-end segment. They pointed out that in general US consumers were brand-conscious, and this was especially true in the case of high-end products. The lack of a positive brand image in this consumer segment would probably make it difficult for Haier to succeed in the high-end markets. Analysts felt that Haier had an additional weakness in its distribution and service centers...

Future Prospects

Despite a few reservations, analysts too were, by and large, upbeat about the company because of its strong performance in breaking into the American market in a short time.

Said Nicholas Heymann of Prudential Securities, "Over five years, it could become a force." With quality products and lower prices, it was felt that Haier would be able to garner a sizeable market share in the US. Haier's experience in the geographically vast and diversified Chinese market would serve it well in catering to the US market.

However, a major worry for Haier is how to fund its expansion plans. Increasing competition in the domestic markets is bringing Haier's finances under pressure.

Questions 1:

What in your opinion is the significance of an organization entering into International Markets for business? Is it advantageous or disadvantageous?

Questions 2:

Is it possible for an organization like Haier to sustain its competition in brand conscious and quality conscious markets such as US and other countries?

Questions 3:

What are the countries that you would suggest Haier should concentrate upon? Why?

Questions 4:

What should be the marketing strategies that Haier should employ in Emerging Markets, Maturing Markets and Declining Markets ? Explain the reasons behind it.

Analyze alternative farm investments options and make relevant conclusions.

Do you think Google’s dominance of the Internet search market is detrimental to consumers and/or firms? Why or why not?

Research and review trends in inflation (CPI), interest rates (short and long term), GDP and employment over the last year. Then read the latest speech by the Federal Reserve and answer the following short essay questions. While this is not a paper, you must still properly cite your answer and write in full sentences.

1. Describe and explain the cause of any inflation (or lack of) over the last year.
2. Describe and explain the trends in unemployment over the last year.
3. Report on the current interest rates. Address the fed funds rate, the ten-year treasury rate and the 30 year treasury rate. Explain how and why they have changed over the last year.
4. Describe and explain the shape of the yield curve. What does the curve tell us about the anticipated future of the economy?
5. What is the Federal Reserve's current view of the general state of the economy? Of employment? Of inflation?
6. What is the current primary concern of the Chairman of the Federal Reserve? How is he addressing that concern?
7. How would you advise the Fed to set interest rates next month? Explain your answer.

Suppose a central bank that has an inflation targeting mandate.

(a) Explain why such a mandate might lead to monetary policy becoming a stabilizing policy regarding real GDP. [Hint: Use an AD-AS diagram.] [5]

(b) Given the long and variable lags involved in the full effects of monetary policy being felt throughout the economy, is there any danger that the inflation mandate might turn out to be destabilizing (leading to wider swings in GDP)? Explain. [5]

How does globalization and automation affect the middle-class, especially in South Korea?

What is a network externality? How does a network externality serve as a barrier to entry? Is this barrier surmountable? Provide one example. Make sure you carefully explain your answer. – Maximum number of words 120

1. John will open an Italian restaurant in IFC Mall in Central in December 2020. IFC Mall is a popular mall with a lot of different kinds of restaurants. John’s Italian restaurant will be located on 3^rd level of the mall and next a Japanese restaurant on the left and a Vietnamese restaurant on the right.   John’s Italian restaurant is a fine dining restaurant, which targets the office workers and shoppers.

1. Identify what kind of marketing tool that John needs to use in order to analyze the competition on the 3^rd level of IFC Mall. Then, suggest any THREE elements that can be used for comparison.    

b. John would like to use behavior segmentation to segment the market. Explain any THREE types of behavior segmentation that are suitable for office workers and shoppers.   

The table contains price and quantity information for two vehicle models produced by Ford Motor Company, the F-series trucks and Escape SUVs.

a. Calculate the amount contributed by Ford to the U.S. GDP (real and nominal) from the sales of the two models in 2016 and 2017.

b. Determine the growth rate of nominal GDP (if Ford were the entire economy).

c. Determine the growth rate of real GDP( if Ford were the entire economy).

d. Use the shortcut you learned to convert between real and nominal growth rates to determine the growth rate of prices.

e. Is the increase in nominal GDP due to a change quantity, a change in prices, or both?

In 250 words describe Karl Marx predicted the downfall of capitalism. How do world events during the past fifty years indicate flaws in his prediction? please type

List three specific things that would cause the demand for ride-share services (i.e., Uber or Lyft) to shift. Use three different categories (all 5 listed below) of demand-shifters in your answer.

• Changes in Income
  • Normal good – a good for which a positive relationship exists between changes in consumer income and changes in demand
  • Inferior good – a good for which an inverse relationship exists between changes in consumer income and changes in demand
• Prices of related goods
  • Substitutes – goods for which a positive relationship exists between changes in the price of one and changes in demand for the other
  • Complements – goods for which an inverse relationship exists between changes in the price of one and changes in demand for the other
• Changes in Consumer Tastes
  • Fads
  • Changes in quality
• Changes in Consumer Expectations
  • Changes in Price Expectations
  • Changes in Income Expectations
• The size of the market

True or False and why..The Federal reserve monitors and regulates the supply of money in the economy.

1. During the 20^th century, what role did changes in innovation, technology, and communication play:

• in the decline of agriculture’s relative size (in terms of # of jobs) while simultaneously allowing for agricultural production to significantly increase?
• in the decline of manufacturing’s relative size, (in terms of # of jobs) resulting in a fourfold increase in the amount of manufactured goods with only a 20% increase in manufacturing employment?
• growth in the services sector?
• growth in international trade?