AQA A2 BUSS4 Globalisation, UK Manufacturing & EU
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Taiwan's Foxconn to delay $4.3bn takeover of Sharp - BBC News

Taiwan's Foxconn to delay $4.3bn takeover of Sharp - BBC News | AQA A2 BUSS4 Globalisation, UK Manufacturing & EU | Scoop.it
Taiwan multinational Foxconn has said it will delay the signing of a $4.3bn (£3.08bn) deal to take over struggling Japanese electronics giant Sharp.
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Great story for wide range of BUSS4 topic areas - diversification, globalisation, emerging markets and takeovers.

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How Did P&G Reach the Top in China?

How Did P&G Reach the Top in China? | AQA A2 BUSS4 Globalisation, UK Manufacturing & EU | Scoop.it
In early 2013 the BBC asked global brand research company Millward Brown to identify the 20 most powerful foreign brands in China: the ones that have gone in and succeeded where many others have failed. When the results came back one noticeable feature was that one company - Procter and.
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Tutor2U article with links and videos on how Proctor & Gamble has eventually become very successful in China.

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Why Tesco struggled to crack China

Why Tesco struggled to crack China | AQA A2 BUSS4 Globalisation, UK Manufacturing & EU | Scoop.it
With nearly 1.4 billion people, China is the biggest consumer market in the world. Yet the supermarket giant Tesco has found it tough to crack the market.
Mr Billinghurst-Bright's insight:

An interesting video on how Tesco has struggled to crack China on its own and its change in strategic approach of using a joint venture with Chinese firm China Resources Enterprise (CRE). An essential example to use which proves what works in the UK does not necessarily work in China and the importance of gaining local knowledge through joint ventures.

 

Extra story:
1. Tesco set to withdraw brand from China in new joint venture
UK supermarket in talks with China's biggest retailer, which means the Tesco name is likely to disappear from the country

Some data from Tesco's strategy of market entry in China moving from an unsuccessful venture of Tesco owned stores (at a £1.5bn cost) to a Joint Venture with China's biggest retailer, state owned China Resources Enterprise (CRE) which would leave Tesco with a 20% stake.

 

This compares with Tesco's struggles in the US with Fresh & Easy based on failing to adapt to cultural differences.

 

This article also feature some details on the struggles of two other UK firms in China B&Q, M&S and US firm Best Buy. 

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Made in Britain. Saved in India. Craved in China: How the Jaguar Land Rover group was saved...by Indian cash and Chinese drivers

Made in Britain. Saved in India. Craved in China: How the Jaguar Land Rover group was saved...by Indian cash and Chinese drivers | AQA A2 BUSS4 Globalisation, UK Manufacturing & EU | Scoop.it
In 2010-11, JLR made as much profit – £1.1 billion – as it cost Tata to buy just three years earlier, and around £400 million more in the year just ended.
Mr Billinghurst-Bright's insight:

TOPIC: UK Manufacturing, Globalisation, Emerging Markets, Mergers & Acquisitions, Growth Strategy, Ansoff's Matrix, Porter's Generic Strategies

 

A comprehensive article on Tata's turnaround of JLR. An essential case study for BUSS4 covering emerging markets, strategies for growth (takeovers) and the recession etc. Must read.

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Jaguar Land Rover 'to double' Coventry base

Jaguar Land Rover 'to double' Coventry base | AQA A2 BUSS4 Globalisation, UK Manufacturing & EU | Scoop.it
Car giant Jaguar Land Rover reveals plans to double the size of its operations at its Coventry headquarters.
Mr Billinghurst-Bright's insight:
Additional information about their Chinese Joint Venture: http://www.bbc.co.uk/news/uk-england-coventry-warwickshire-29716959
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Threat of globalisation - Intellectual property theft in China - JCB boss takes a dig against 'unscrupulous' firms in China

Threat of globalisation - Intellectual property theft in China - JCB boss takes a dig against 'unscrupulous' firms in China | AQA A2 BUSS4 Globalisation, UK Manufacturing & EU | Scoop.it
The chairman of JCB has called for Government action on "unscrupulous Far Eastern" companies that have "copied" and "ruthlessly exploited" the intellectual property belonging to British companies.
Mr Billinghurst-Bright's insight:

One of the major threats of operating in China is the copying of intellectual property belonging to British companies. Many companies like JCB and Dyson complain about the lack of enforcement of patents, appropriate sanctions and punishment on Chinese firms involved in this practice. In some industries it is very common and firms are investing in R&D only to see their ideas exploited and other firms profiting from it.

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Globalisation & Mattel - Can Barbie Make A Comeback In China?

Globalisation & Mattel - Can Barbie Make A Comeback In China? | AQA A2 BUSS4 Globalisation, UK Manufacturing & EU | Scoop.it
After Mattel’s embarrassing closure of its flagship store, the House of Barbie, in Shanghai two years ago, the American toy maker seems to have learned a thing or two about the Chinese market.
Mr Billinghurst-Bright's insight:

Mattel appears to be taking a more customer focused approach (Market orientated) rather than the Product/asset orientated approach used in the first attempt to crack China's retail toy market. This means it is trying to appeal to what consumers actually want in China rather than simply playing to their previous strengths and what had worked for them in the US. The Barbie brand did not work the first time around in China and was a major setback. Will this approach be any better?

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Globaisation - China sales lift Lego's profit

Globaisation - China sales lift Lego's profit | AQA A2 BUSS4 Globalisation, UK Manufacturing & EU | Scoop.it
Danish toymaker Lego's profits rise 9% to 6.12 bn kroner ($1.12bn; £673m) in 2013 as the firm expands beyond its signature building blocks.
Mr Billinghurst-Bright's insight:

Two great videos are included on this story about Lego benefiting from an increase in sales in China whist sales in Europe and the US fall due to weak economic conditions. Lego is a fairly premium priced toy and this shows the positives that can come from diversifying geographically, especially in an emerging market such as China.

 

The video also talks about the firm's strategy and the benefits of being a Private limited company (Ltd.) over a Public limited company (Plc.). The firm is able to think more long-term and design strategies for the future without the pressure for short-term returns from public shareholders and the finance sector.

It also mentions at the end of the first video about its main risk being the potential of over expansion.

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Lego builds yet another record profit to become world's top toymaker

Lego builds yet another record profit to become world's top toymaker | AQA A2 BUSS4 Globalisation, UK Manufacturing & EU | Scoop.it
The Danish toy company has overtaken rival Mattel after 'an incredible quadrupling of revenues in less than 10 years'
Mr Billinghurst-Bright's insight:

More details on Lego here particularly interesting is that: sales in China, where Lego will open a new $300m factory in 2016, grew by more than 50% last year - although from a small base. CEO Knudstorp believes Lego could be expanded to 600m Chinese customers within in the next decade."But we need a set up that is much more diverse, much more international, than we are today.

"It would be arrogant to think that just because you're Danish you're equally knowledgeable about what it takes to succeed in countries all over the world," he said. "We want to remain very much a Danish company rooted here in Billund, a place where we were born and we have our heritage and we will never leave.

"But we want to be a Danish company that's welcoming to all sorts of cultures."

To do so the company is diversifying senior management into four global offices in London, Singapore, Shanghai and Connecticut.

 

This shows Lego is very serious about its expansion into China and its plans for the future.

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Skills gaps, UK manufacturing & migration - How many cheers for migration?

Skills gaps, UK manufacturing & migration - How many cheers for migration? | AQA A2 BUSS4 Globalisation, UK Manufacturing & EU | Scoop.it
A record number of people migrated to the UK last year to work - which is a measure of the relative success of the British economy.
Mr Billinghurst-Bright's insight:

TOPIC: EU, UK Manufacturing, Migration

 

An increase in high-skilled EU migrants to the UK to help fill the skills gap and possible exploitation of low-skilled migrants pushing down wages and business costs.

 

Extra stories:

1. Stricter immigration policy ‘could harm the UK in the long run’

http://eandt.theiet.org/news/2015/mar/immigration-engineers-uk.cfm

Firms such as Dyson and Siemens are struggling to find enough engineers in the UK and would like it be easier to to attract them to the UK.

2. UK manufacturers should bridge skills-gap with German model:

http://www.foodmanufacture.co.uk/Manufacturing/UK-manufacturers-should-bridge-skills-gap-with-German-model 

3. “It’s getting the engineers that’s difficult” – James Dyson on UK immigration and industry:

http://www.davidsonmorris.com/getting-engineers-thats-difficult-james-dyson-uk-immigration-industry/ 

4. Low-skilled workers 'at risk of exploitation':

http://www.bbc.co.uk/news/uk-28205968 

5. JLR using migrant engineers:

http://www.workpermit.com/news/2013-09-13/jaguar-land-rover-expansion-a-triumph-for-uk-immigration 

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London Taxi Manufacturer To Create 1,000 Jobs

London Taxi Manufacturer To Create 1,000 Jobs | AQA A2 BUSS4 Globalisation, UK Manufacturing & EU | Scoop.it
A new Coventry plant will build ultra-low emission vehicles while Jaguar Land Rover also ups investment in the West Midlands.
Mr Billinghurst-Bright's insight:
Video from the factory: http://www.bbc.co.uk/news/business-24519406
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Globalisation - Britain's steel industry: What's going wrong? - BBC News

Globalisation - Britain's steel industry: What's going wrong? - BBC News | AQA A2 BUSS4 Globalisation, UK Manufacturing & EU | Scoop.it
Why is Britain's steel industry in such trouble with so many jobs being lost - and is it really all the fault of cheap Chinese imports for the collapse in steel prices?
Mr Billinghurst-Bright's insight:

 

Extra stories:

1. Why is China producing so much steel?

http://www.bbc.co.uk/news/business-35168889

2. Tata Steel cuts 400 British jobs as demand faltersIndustry giant slashes South Wales roles to improve its competitiveness

http://www.telegraph.co.uk/finance/newsbysector/industry/10938031/Tata-Steel-cuts-400-British-jobs-as-demand-falters.html

 

 

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Brexit could lead to UK small businesses being free from €41bn of EU red tape. | Better Off Out

Brexit could lead to UK small businesses being free from €41bn of EU red tape. | Better Off Out | AQA A2 BUSS4 Globalisation, UK Manufacturing & EU | Scoop.it
Mr Billinghurst-Bright's insight:

Arguments against EU membership

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Ikea in China - The Classic Long-term Success Story Built on Localisation | Business | tutor2u

Ikea in China - The Classic Long-term Success Story Built on Localisation | Business | tutor2u | AQA A2 BUSS4 Globalisation, UK Manufacturing & EU | Scoop.it

I suddenly realised that, whilst we've featured Ikea prominently in our exam coaching workshops for a couple of years, we haven't linked to the wealth of resources that are out there to help tell & explain [...]...

Mr Billinghurst-Bright's insight:

Excellent for globalisation, emerging markets and localisation.

 

What are the secrets of IKEA’s success? 

http://www.tutor2u.net/business/blog/what-are-the-secrets-of-ikeas-success

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Tesco & Globalisation difficulties - Can UK firms make it in the US?

Tesco & Globalisation difficulties - Can UK firms make it in the US? | AQA A2 BUSS4 Globalisation, UK Manufacturing & EU | Scoop.it
Supermarket group Tesco has announced it is getting out of the United States following a strategic review of its Fresh & Easy stores. So why is the US market so difficult to crack for UK retailers?
Mr Billinghurst-Bright's insight:

TOPIC: Globalisation, Strategy

 

Despite Tesco's extensive research they did not get it right in the US. Too many pre-packaged meals, (therefore not 'Fresh') and a focus on self-checkouts (Not 'easy') were two of the biggest problems. American consumers expect customer service. The other problems included setting up in the midst of the Great Recession, a focus on convenience stores when American shoppers often shop in bulk using their cars. The Fresh & Easy stores were convenience stores and could not offer 'one-stop-shops'. Not only this but Tesco focussed too much on this venture neglecting their UK operations. By sending their A team to the US they left their B team to run Tesco. As a result they have lost ground to discount retailers and lost market share for no longer focusing on low price or quality.

 

Other excellent articles on Tesco and struggling with international expansion:

Fresh, but not so easy: Tesco joins a long list of British failure in America: http://www.theguardian.com/business/2012/dec/09/fresh-not-easy-tesco-british-failure-america 

Why did Tesco fail in the U.S.?: 

http://www.cbsnews.com/news/why-did-tesco-fail-in-the-us/ 

Tesco pays out to rid itself of US chain Fresh & Easy:  http://www.theguardian.com/business/2013/sep/10/tesco-strikes-deal-fresh-and-easy Tesco's

Fresh & Easy: a timeline in pictures: 

http://www.telegraph.co.uk/finance/newsbysector/retailandconsumer/10299870/Tescos-Fresh-and-Easy-a-timeline-in-pictures.html 

Tale of Two Supermarkets: Why Fresh & Easy Flopped and Fairway Flies High: http://business.time.com/2013/04/18/tale-of-two-supermarkets-why-fresh-easy-flopped-and-fairway-flies-high/

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Waterford Wedgwood shifts to Asia to save company

Waterford Wedgwood shifts to Asia to save company | AQA A2 BUSS4 Globalisation, UK Manufacturing & EU | Scoop.it
For more than two centuries, Waterford crystal and Wedgwood china have been symbols of Irish and British craftsmanship. Now, their future may lie in Asia.
Mr Billinghurst-Bright's insight:
On 5 January 2009, following years of financial problems, struggling to compete with cheaper Asian produced rivals, and the global financial crisis of 2008, Wedgwood was placed into administration on a "going concern" basis, with 1800 employees remaining.In March 2009, private equity group KPS Capital Partners acquired the firm and invested €100m, and moved most jobs to Asia to cut costs and return the firm to profitability,saving it from complete failure.1,500 jobs were initially cut in the U.K., leaving 800 workers in the U.K. producing only the high-end Wedgwood products.The firm previously employed 1,900 staff in the UK and 600 at its factory in Barlaston, Stoke-on-TrentNow the Indonesian capital Jakarta is the largest manufacturing centre for Wedgwood, with 1,500 people working on production.The sad legacy of Wedgwood: 

http://www.independent.co.uk/news/business/analysis-and-features/the-sad-legacy-of-wedgwood-1226638.html ;

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New models drive Jaguar Land Rover to record profits - Telegraph

New models drive Jaguar Land Rover to record profits - Telegraph | AQA A2 BUSS4 Globalisation, UK Manufacturing & EU | Scoop.it
Third quarter profits double as demand for Range Rover Sport, new Range Rover and Jaguar F-Type continue car maker's transformation under India's Tata
Mr Billinghurst-Bright's insight:

TOPIC: UK Manufacturing, Globalisation, Emerging Markets (China)

 

The Telegraph's details on Tata's success and turnaround of JLR firmly based on targetting emerging markets such as China. With its luxury brands meeting the needs of the growing wealthier class in the country sales have boomed. This is in contrast to their troubles in India further showing the difficulties in operating in emerging markets (BRIC).

 

China Growth Fuels Jaguar Land Rover Sales: 

http://news.sky.com/story/1139648/china-growth-fuels-jaguar-land-rover-sales Good video clip highlighting JLR's success in China. It briefly looks at the premium prices charged to take advantage of China's growing economy and wealthier consumers.

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Globalisation & emerging markets - JCB to create 2,500 jobs as Osborne praises 'strong' manufacturing investment

Globalisation & emerging markets - JCB to create 2,500 jobs as Osborne praises 'strong' manufacturing investment | AQA A2 BUSS4 Globalisation, UK Manufacturing & EU | Scoop.it

Vehicle manufacturing giant JCB is set to create 2500 new jobs by 2018 as part of a £150 million expansion plan.

Mr Billinghurst-Bright's insight:

 Extra story:

JCB proves British manufacturers can win on the world stage.

http://www.havingtheircake.com/content/3_Consequences/2_Decline/fact%20and%20opinion2/JCB%20proves%20British%20manufacturers%20can%20win%20on%20the%20world%20stage.php

 

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Benefits of globalisation - JCB sees record £2.75bn turnover

Benefits of globalisation - JCB sees record £2.75bn turnover | AQA A2 BUSS4 Globalisation, UK Manufacturing & EU | Scoop.it
Digger firm JCB reveals the best financial results in its 66-year history, with a £2.75bn turnover for 2011.
Mr Billinghurst-Bright's insight:

TOPIC: UK Manufacturing, Globalisation, Emerging Markets, Ansoff's Matrix

 

JCB finds success in emerging markets by investing early to build long-term success. By operating in a wide range of markets they are able to spread risk and remain successful even when some markets experience decline. Machinery produces like JCB rely on economic growth for demand.

 

2008: http://news.bbc.co.uk/1/hi/england/staffordshire/7433712.stm

 

2014: http://www.bbc.co.uk/news/uk-england-stoke-staffordshire-27370984 

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Why Localisation Is Important for Success in China – Yum! Brands and the Rapid Growth of KFC

Why Localisation Is Important for Success in China – Yum! Brands and the Rapid Growth of KFC | AQA A2 BUSS4 Globalisation, UK Manufacturing & EU | Scoop.it
Businesses from outside China trying to sell in China face a critical question as they try to enter China. How far should they go to adapt or redesign (“localise”) their products and services to meet the needs and wants of customers in China? Should they adapt existing products just enough.
Mr Billinghurst-Bright's insight:

A great Tutor2U article on Yum! and KFC's sucess in China and how they have used 'localisation' to adapt their product offering to meet Chinese tastes. It also covers the various other strategies they have used to gain first mover advantage and continued success including setting up their own operations to remain in control over the brand, agressive growth and empowerment of staff. Compare and contrast KFC's massive 40% market share of the fast food industry in China compared with McDonald's 16%.

Read: http://www.bloomberg.com/news/2011-01-26/mcdonald-s-no-match-for-kfc-in-china-where-colonel-sanders-rules-fast-food.html. McD was slower to get into the market and has not localised as well. They are investing in aggressive growth through franchising in an attemtp to catch up with KFC but are taking many risks including intellectual property protection and local managers lacking sufficient management skills to be successful and maintain the brand image.

Read:

http://www.chinabusinessreview.com/the-pros-and-cons-of-franchising-in-china/

http://www.reuters.com/article/2012/02/28/us-china-mcdonalds-idUSTRE81R0BC20120228 ;

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Reshoring - Rob’s Trunki call brings manufacturing back from China to the UK | Bristol Business News

Reshoring - Rob’s Trunki call brings manufacturing back from China to the UK | Bristol Business News | AQA A2 BUSS4 Globalisation, UK Manufacturing & EU | Scoop.it
Every best-selling children's ride-on Trunki suitcase sold in Britain will be designed in Bristol and made in England by the end of this year. Magmat...
Mr Billinghurst-Bright's insight:

TOPIC: Globalisation, UK Manufacturing, Reshoring, Offshoring

 

Rob Law gives the many reasons why he decided to move production of the Trunki back to the UK.

 

Additional links:

Radio interview with Magmatic founder Rob Law. His product, the Trunki, was famously rejected on Dragon's Den. He mentions some interesting data about the company and the reasons why it has reshored production of its products back to the UK form China.

http://news.bbc.co.uk/today/hi/today/newsid_9784000/9784167.stm 

 

Magmatic start-up story: http://startups.co.uk/magmatic-trunki-rob-law-mbe/ 

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Cadbury owner Mondelez announces £75m upgrade of Bournville factory

Cadbury owner Mondelez announces £75m upgrade of Bournville factory | AQA A2 BUSS4 Globalisation, UK Manufacturing & EU | Scoop.it

Investment at Birmingham chocolate maker welcomed by unions and business leaders

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400 Cadbury's workers sacked after Kraft confirms factory will close just ONE WEEK after U.S. firm promised to keep it open: http://www.dailymail.co.uk/news/article-1249728/Cadbury-sacks-400-workers-Kraft-breaks-promise-shut-factory.html ;

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Foxconn: 'Hidden dragon' out in the open

Foxconn: 'Hidden dragon' out in the open | AQA A2 BUSS4 Globalisation, UK Manufacturing & EU | Scoop.it
Foxconn - one of a number of once-obscure "hidden dragons" - is the world's largest maker of consumer electronics.
Mr Billinghurst-Bright's insight:

TOPIC: Manufacturing, Globalisation, Offshoring, Emerging Markets (China), Apple, Ethics & CSR (Corporate Social Responsibility) 

 

Some details on Foxconn one of the biggest employers in China and the makers of Apple's product amongst many other brands. Details on problems with working conditions, suicides etc covered here. This is a company you should know about as they are a major employer making goods for many western brands in China and have had many ethical problems in recent years.

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Why big American businesses fail in China

Why big American businesses fail in China | AQA A2 BUSS4 Globalisation, UK Manufacturing & EU | Scoop.it
Some of America’s strongest corporations have ventured into the People’s Republic, only to stagger out battered a few years later. Here’s why.
Mr Billinghurst-Bright's insight:

An interesting and short article on why four big American firms; Mattel, Home Depot Google and Ebay all found difficulties in China and failed. These big four appear to have failed because of the following reasons: 

Home Depot - Labour is cheap so Chinese consumers hire workmen rather than do DIY and they disliked the store format. Chinese consuemrs also lack knowledge and experience in home ownership and decorating so IKEA's method of demonstrating rooms has worked well. (

Read this article for more on this issue 

http://www.forbes.com/sites/china/2011/02/17/why-home-depot-struggles-and-ikea-thrives-in-china/)

Mattel & Barbie - Poor research and strategic decision making, poor brand extension and market development,  weak brand recognition and over investment.

Ebay - Lack of social interaction in sales, cultural differences.

Google - Government pressure/influence in China, hacking and security concerns.

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Foreign-owned UK car industry offers economic lesson

Foreign-owned UK car industry offers economic lesson | AQA A2 BUSS4 Globalisation, UK Manufacturing & EU | Scoop.it
Foreign ownership has helped transform the once-struggling British car industry. So what can other industries learn from this? Newsnight economics correspondent Duncan Weldon reports.
Mr Billinghurst-Bright's insight:

Consider whether foreign ownership of foreign firms is a problem or not. Consider the Cadbury and Kraft deal and contrast with JLR & Tata.

 

AstraZeneca & Pfizer (US) attempted takeover: http://www.theguardian.com/business/2014/sep/26/astrazeneca-pfizer-return-takeover-bid

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