Term paper on a competitive strategy for Leatherette Industries Corporation: Bag exporter

• Main Author: Lin, I-Chun
• Format: text
• Language: English
• Published: Animo Repository 1996
• Subjects: Business Administration, Management, and Operations
• Online Access: https://animorepository.dlsu.edu.ph/etd_masteral/2181
• Institution: De La Salle University

Leatherette Industries Corporation (LIC) is an original-equipment-manufacturer (OEM) of a full range of quality bags for customers, most especially in the international scene. Their products are usually exported to Germany, U.K, U.S., Spain, Japan and Australia among others on a job basis. The company currently produces all types of bags using leather, nylon, PVC coated fabrics. These product groups include sports, camera/video bags, portable audio and cell phone cases, tote/ vanity bags and computer laptop/ notebook cases, and among them, camera bags and computer cases are considered to be the most sought-after products. As for the labor-intensive bag making industry in the Philippines, it is mostly composed of small and medium scale firms that compete on the artistic and craftsmanship of the workers. But with the global trade liberalization and GATT/WTO, emerging lower labor markets such as China and Vietnam becomes threat for the Philippines industry. What distinguish LIC from other players in the industry is that the company has a highly diversify lines that project first-class quality and cater to higher segment of the market, as compared with China and Vietnam that serve the lower ends. With their long experience and good business rapport with suppliers and customers, the company always schedule and deliver their products on time and with utmost satisfaction from the buyers as compared with its local competitors. In order to be competitive, it is recommended that the company adopts the cost leadership strategy to lessen the overhead cost by selling more units of output per unit of work done. This can be achieved through market development strategy, and with this the company can supply major renowned buyers and eventually expand to Middle East, Switzerland, Canada and New Zealand. By adopting product development strategy, through offering new or modified products suited for the geographical regions, can also strengthen Leatherette Industries Corporations position as best in quality and best in style in the bag industry.