Corporate strategies for Westrade International Co., Inc

• Main Author: Penuliar, Natalie Joy A.
• Format: text
• Language: English
• Published: Animo Repository 2005
• Online Access: https://animorepository.dlsu.edu.ph/etd_masteral/4485
• Institution: De La Salle University

Westrade International Co, Inc. is a trading firm primarily engaged in supplying high quality electrical and industrial products. Some of their products include control stations, terminal enclosure, cable termination kit, pad mounted transformer, cable glands, control cables and medium voltage cable. Among their major customers are Coca-Cola, Petron, PNOC, Shell, Caltex Philippines and a lot more. The company belongs to an industry that deals with highly specialized products which is why the company has only identified two (2) other companies that they compete with directly. In analyzing the industry, the 5-Forces model by Michael Porter was used. It shows that rivalry among the firms is low since there are few companies competing operating in a highly-specialized industry. The barriers to entry for this industry are high as evidenced by the few companies engaged in this line of business. The threat of substitute products is remote due to the exclusive distributorship granted to the companies to carry certain brands. The bargaining power of buyers is neither high nor low. On the hand, the bargaining power of suppliers is relatively high due to strong threats of forward integration and lack of substitute for their product. Westrades vision is To be leading suppliers of high quality engineered electrical and mechanical equipment for commercial and industrial projects in the Philippines. Its mission is To provide quality products, on-time delivery, and cost-effective pricing to all our present and future customers. To carry ready in stock of special wires and cables of known European and US brands in sufficient volume to meet urgent local requirements. The company has a general objective of increasing sales by at least 30% every year. To attain objective, the generic strategy to be employed by the company is focus-differentiation strategy. The proposed corporate strategies to be employed by the company area as follows: (1) Sourcing for high quality, saleable and reasonably priced allied products; (2) Entering into more tie-ups with provincial distributors; (3) Create corporate planning and integrate functional areas using information technology; (4) Develop formal policy and procedures for the company; and (5) Conduct training programs and set-up regular monitoring system for sales. Upon implementation of these proposed strategies, financial projections show at net income of P4.557 million for 2004 and will reach P6.37 million by the end of 2006. Total assets will amount to P52.2 million in 2004 and will increase to P64 million in 2006. Alongside, however, is the increase in current liabilities from P5.29 million in 2004 to P6.9 million in 2006. The companys projected cash flow in 2004 will show a net increase of P2.6 million, a decrease of P410,339.56 in 2005 and back to a net increase of P1.46 million by 2006.