Strategic thrusts for Global Sources

• Main Author: Amador, Dennis
• Format: text
• Language: English
• Published: Animo Repository 2002
• Subjects: Philippines > Commerce; Business Administration, Management, and Operations
• Online Access: https://animorepository.dlsu.edu.ph/etd_masteral/2774
• Institution: De La Salle University

There are five major considerations in assessing the viability of strategic thrust for Global Sources. And this paper will provide solutions to the following questions: Will the total solution package maintain the company's profitability in the future? No. In spite excellent product features, study shows that electronic services lack product 'stickness' or loyalty customers. This can be attributed from the fact that e-markets have lowproduct differentiation, and low switching costs due to strong industry competition and diverse competitors. Will the current business model survive in the future? No. The match-making model will eventually erode as companies are becoming more sophisticated due to technological and industry convergence. Alliance between industry members are gaining popularity. Hence, independent B2B e-markets must increase the level of product integration into the customers' value chain. Is there a sufficient reason to justify entry into new market? Yes. Global Sources experience in developing business units in different countries will provideleverage to enter into new markets. The company can choose whether to forge strategic partnership or acquire new companies, whichever is deemd favorable. Likewise, the increase in online users in Europe, which will be the most wired continent in the world, provides a considerable demand to justify entry into the European market. Further, despite the terrorist attacks, international Data Corporation predicted that the IT spending worldwide will slowly recover and post a modest growth rate of 5.5% in 2002. IT spending is one of the parameters being considered to the growth of e-commerce together with financial payments systems, and distribution and delivery systems, which will likewise increase in the future. Will the cost of operation be sufficinetly low to justify entry? Yes, Global Sources can reduce operation costs by implementing Voice over Internet Protocol (VoIP) to lessen long distance calls expense by as much as 97%. Likewise, the company can improve production and implementation cycle from 60 days to 31 days. This will hasten revenue recognition two times faster than the current system. How should the market be approached? The analysis has shown that Global Sources should further increase product functionality and integrate it to cudtomers' supply chain. Also, Internet Service Provision (ISP) will create higher switching cost and product differentiation, which improve product stickiness, necessary in highly competitive markets such as Europe and North America. Strategic moves have been thoroughly discussed so that the company will benefit from its experience.