Environmental Analysis of ERBAKIR CN WIRE Company
ERBAKIR CN WIRE Company operates in a competitive business environment that faces a fierce competition, especially from its closest rival Sarkuysan Elektrolitik. Both companies engage in the production of electrolytic copper wire across Turkey and other regions of the world. Sarkuysan Elektrolitik uses differentiation strategy to compete favorably with ERBAKIR CN WIRE. As a result of increased competition, Sarkuysan Elektrolitik could also benefit from similar low offshore costs enjoyed by ERBAKIR CN WIRE in manufacturing, as a leader in the industry. This would pose a significant threat to ERBAKIR CN WIRE since it would be forced to lower its production capacity, thereby leading to the loss revenue and decreased market share. Moreover, Sarkuysan Elektrolitik employs business strategies in its operation to offer discounted and high-quality copper wires to its customers, thus competing nearly at the same level in the industry as ERBAKIR CN WIRE. The strategies that are used by Sarkuysan Elektrolitik as a direct competitor play a crucial role in attracting high-income customers while, at the same time, increasing its revenue and becoming more profitable (Hill & Jones, 2014).
On the other hand, its SWOT analysis has identified some weaknesses, including the failure to compel Chinese smelters not to cut down their consumption output. Therefore, this implies that its revenue will be affected significantly and increase production cost (Hill & Jones, 2014).
However, ERBAKIR CN WIRE has been distinguished as one of the leading firms in the industry that is characterized by sustainable growth. Moreover, the company has many investments across the world, which increases its revenue significantly to spearhead its growth and expansion. Today, ERBAKIR CN WIRE has the biggest production capacity of copper wire as compared to other production plants in Turkey. Besides, the company has become more competitive with well-established markets and large clientele base, satisfying electrolytic copper needs of National Aeronautics and Space Administration (NASA) and other high-technology firms in the United States, Italy, as well as Germany. The firm has achieved a competitive advantage to become a leading player in the industry by exporting C.N. Wire to the United States based on its corporate-level strategy of diversification and global expansion. Moreover, the firm invests in systems of quality management, thus providing superior quality copper wires that are well known across the world (Goold, Campbell & Alexander, 1994).
Also, ERBAKIR CN WIRE’s global expansion strategy has helped the company to increase its operation in overseas markets, making it one of the leading firms in the production of electrolytic copper wires in Turkey. Hence, the company has enjoyed a favorable market in Turkey and in the international markets, resulting to agrowth in its revenue while, at the same time, increasing its profitability levels. Besides, the company is dedicated to offering world-class quality to its customers across the globe with the best price possible, enabling it to survive competition in the industry. Moreover, the expansion and cost strategy employed by ERBAKIR ¬ CN WIRE has become a significant entry barrier for its competitors (Goold, Campbell & Alexander, 1994).
ERBAKIR CN WIRE is led by a Chief Operations Officer (CEO) who is the chairman and the president of the company. The structure is also comprised of a senior management team, including the vice-president, board of directors, managers and subordinate staff. To realize growth, ERBAKIR CN WIRE should strive to become more competitive in the market through the production of superior C.N. Wire. Given the fact that its products are sold in the United States and Europe, it should endeavor to increase its clientele base in these regions. Moreover, ERBAKIR CN WIRE products have increased in a number of Eurasian companies that operates in nations such as Israel and Kazakhstan. Hence, the company should also consider improving its promotional and advertising campaigns to penetrate its core export markets. Further, it should improve its technology in production to serve a host of industries across the globe such as automotive and electronic sectors (Hill & Jones, 2014).
Through increasing its technological capacity, the company will be able to produce superior electrolytic copper wires to meet the increasing demand of high-technology firms in overseas countries such as the United States of America, Italy and Germany. Also, enhanced technology will help the firm to boost its production capacity and lower its costs due to economies of scale. Moreover, it will be able to penetrate local markets in Turkey with ease meeting the needs of automotive and electronic sectors (Hill & Jones, 2014).
Therefore, one of the best generic strategies that should be implemented by the company includes low-cost leadership strategy. This strategy will enable ERBAKIR CN WIRE to produce high-quality electrolytic copper wire at a lower cost as compared to its competitors to increase its market share. Moreover, the company may use differentiation as a value discipline strategy to compete favorably with its competitors in the same industry. Also, ERBAKIR CN WIRE should implement a grand strategy such as diversification to penetrate new markets with increased demand for electrolytic copper wires (Hill & Jones, 2014).
Nonetheless, for ERBAKIR CN WIRE to be successful in the long-run, it should consider combining both business-level and corporate-level strategies. Business level strategies that should be considered include low-cost leadership, differentiation, and integration strategies. On the other hand, corporate strategies that should be implemented include diversification and international expansion. Also, ERBAKIR CN WIRE should also consider the notion of fast cycle markets in its generic strategies. Since the company operates in a competitive business environment, fast cycle markets would play a significant role in enhancing the level of performance and profitability. ERBAKIR CN WIRE also targets overseas markets and, thus, it should strive to operate effectively without bottlenecks to cover a larger market share. Moreover, improved distribution of information at an organizational level would help in enhancing customers’ response to increase their orders for electrolytic copper wires (Hill & Jones, 2014).
Moreover, focusing on a single business has become one of the most important corporate strategies for businesses to increase revenue and, at the same time, expand globally. ERBAKIR ¬ CN WIRE concentrates on the production of electrolytic copper wires. Hence, the company should make use of this strategy to vertically integrate into an adjacent business, helping it to increase its chain of supply. Besides, the strategy should help it in penetrating local, regional, national, as well as international markets to increase its revenue. Also, the combination of business-level and corporate-level strategies should include integrated strategies that will help the company in venturing into new businesses (Goold, Campbell & Alexander, 1994). Given the fact that ERBAKIR CN WIRE is a big company serving a large clientele base, a combination of these strategies would be most effective to ensure it grows while and achieves a competitive advantage (Goold, Campbell & Alexander, 1994).
References
Goold, M., Campbell, A., & Alexander, M. (1994). Corporate-level strategy: Creating value in the multibusiness company. New York: J. Wiley.
Hill, C. W. L., & Jones, G. R. (2014). Strategic management: Theory : an integrated approach. Australia : South-Western.
