Dorchester Inc.'s international expansion into consumer electronics markets

Dorchester Inc. takeovers

Dorchester, Inc. is a U.S. based conglomerate and has the intentions of expanding its operation to international levels. Recently there has been a trend by its competitors to expand their operations internationally as well. This is the prompter to the decision by the management of Dorchester, Inc. To follow their competitors' trend and venture into the new and emerging markets globally as a long-term business strategy. Through this international expansion Dorchester, Inc. hopes to gain a competitive advantage over its competitors. The particular area of expansion targeted by Dorchester, Inc. is consumer electronics. The conglomerate has indicated their interest in purchasing companies that specialize in consumer electronics in three countries that identified herein (Prodi, 2010).

The management of the conglomerate has a task of determining the potential countries to purchase the companies. Before settling on the countries they are to expand into, the management will have to conduct an economic assessment of these countries. The management will further conduct an economic assessment of the specific companies they will have identified from the three countries. This assessment seeks to determine the potential pros and cons of buying a company that is based in each of the three countries. The entire assessment that is carried out by the management entails an analysis of Dorchester's external environments. There are many countries that have companies which specialize in production of consumer electronics. Therefore, Dorchester, Inc. has a wide variety to choose from, however they scaled their choices down to three countries which are South Africa, Japan and China.

South Africa

There are various consumer electronics companies in South Africa. South Africa is an economically viable country to be explored by Dorchester, Inc. due to various reasons. One of the outstanding attractions into the region is the thriving new technologies therein. Within South Africa, old technologies like analog TVs are seen to be disappearing meaning that the country is up to speed with the current technological advancements taking place. The new technology found in South Africa is performing well and accelerating at a high rate. Technology in South Africa is closely behind that of developed countries. This means that if Dorchester Inc. explores into south Africa they will be sure that the consumer electronics provided by the company is the latest technologically. The uptake of new technology is steady since many people within South Africa are responding positively to new technology. This means that the conglomerate will continue being competitive in the market both in South Africa and the rest of the world. Another advantage of exploring South Africa is the fact that there is an increased growth in telecommunication market .This means that if Dorchester, Inc. buys a company within South Africa they will be sure of a ready market for telecommunications products such as smart phones.

There are also accompanying disadvantages if Dorchester decided to buy consumer electronics company in South Africa. These disadvantages are such as the fact that recent reports show that there is poor performance in a majority of the consumer electronics products. There has seen a slowdown in consumer spending and hence the industry is currently under intense pressure. This is due to the fact that people in South Africa often regard the consumer electronic products as being inessential .Therefore it might not be wise of Dorchester to invest in South Africa since there a lot of uncertainties when it comes to the patterns of purchasing these products.

Generally South Africa is a good option for the conglomerate to venture into. I believe that the country has a lot to offer and it will be a wise decision to buy a consumer electronic company from there.

China

China has been known as a producer of electronic products for a very long time. Most of the consumer electronics are produced in China eventually sold in other countries. Many countries have invested in China due to the potential that exists when it comes to consumer products.

Advantages that Dorchester will enjoy if they invest in China are a healthy growth in the consumer electronics that is expected to take place as forecasted. Consumer electronics are still expected to continue recording volume growth. This is facilitated by the continued growth in the economy as well as an increase in the demand for consumer electronic products. This means Dorchester will benefit if it buys a company in China as the economy in China is on a record high. There is also an increase in internet retailing in China. Most of the sales in Japan are now made through the internet. This means that the products in china have market not only in China but also the rest of the world. The adoption of selling through the internet is advantageous to Dorchester incase it decides to buy a company in China as it comes with lesser expenses as compared to off the counter or display room kind of selling and they will have a market all over the world ( Euromonitor, 2012) beraing that the internet is a wide and open market place. There are also new technology and rising innovations in the consumer electronics. These developments have resulted to the growth of consumer electronics in China. The growths of retail sales that are made from the consumer electronics are strong. The consumer electronics industry is enjoying a strong value in their sales particularly in products that have emerged such as smart phones and tablets. These factors show that China is a viable country for Dorchester to invest into in the consumer electronic industry.

Conclusion

It is clear that all the three countries discussed above have a great investment opportunity to offer Dorchester Inc. Therefore, there should not be hesitations by the management of the conglomerate to invest in these countries. If they do so then they will gain a competitive advantage and its presence will be felt not only in U.S.A but to the rest of the world as well.