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Executive summary

In this case, there are two major problems that I can analyzed. Firstly, Kiki and Houida which are two of major loyal customers of Couture Fashions Bhd (HCF)’s were writing to Jeffrey to inform him that they may looking to China to “contract manufacture” for them as the prices there were very competitive. Second, the previous adverse perception of “Made in China” labels had slowly changed as China now manufactured clothes that are higher quality at substantially lower operating costs.

There were some recommendation that are going to implemented which are proposal to expand to China, proposal to close down HCF’s factories in Malaysia and Thailand or manufacturing its own label for Malaysian and Asean market.

Statement of Problems

HCF may lose their big major loyal customers which is Kiki and Houida as they may looking to China to “contract manufacture” for them as the prices there is cheaper. Apart from that, nowadays China was produce high quality product with cheaper price so then makes the perception of people about the “made in China” goods changed to a good view. This is because of the labour cost in China is cheaper rather than Malaysia.

HCF now is very confusing to make decision but based on the problems they have to make accurate decision. According to these problems they have to deeply make consideration of their short term and long terms decision. As far as I am concerned, the short term problem is HCF may lose their big major loyal customers which is Kiki and Houida. For long term, they may face a very big loss and no wonder if their company will go for bankruptcy as Kiki and Houida may become the benchmark for other customers that are rely on HCF’s company. Other customers may assume that HCF does not maintain its reputation and that is why Kiki and Houida are quit from keep doing “contract manufacture” with HCF. As it shows a bad benchmark to other customer, it may cause other customers quit from HCF.

As a decision, I agree if...