Galanz Business Case Solution

Introduction

Galanz is a Chinese microwave manufacturer that was found in 1991 through acquisition. The company has been through a massive growth and reached a 60 % market share of China’s domestic microwave market in 2003. This positive trend continued and in 2007, Galanz had gained a leading position with a 50 % market share on the global market. The company’s current strategy that has led to the huge success is a cost leadership business level strategy. This strategy has enabled Galanz to offer their products at a fairly low price which has attracted customers that subsequently has made the company market leading in China. The goal is to establish the brand globally but the question is if Galanz is using the right strategy on the corporate level to reach the global market.

The challenges that are being analyzed in this report are the following:

* Low variation and quality of the products

* Poor production planning

* Cannibalism between OBM and OEM businesses

* Magnetron’s production issues

* Low brand recognition on foreign markets

* Ineffective decision-making

Analysis

Galanz’s goal is to maintain its position as the largest manufacturer of microwave ovens on the market, both nationally and globally. The demand for microwave ovens in China is changing, just as the Chinese economy in general. China has had the highest development in the world regarding economy since 1978 and has the next biggest economy after USA since 2010 (Institutet, 2014). This means that the demand of microwave ovens probably will continue to increase in China as their economy is growing fast and the middle-class in particular are getting wealthier (Dominic Barton, Yougang Chen, and Amy Jin, 2013). The assumption that is made for this report is that not only the demand for microwave ovens overall will increase in China, but also the demand for more variety, lower volumes and higher quality of the microwave ovens. The current demand in the foreign countries...