Recommendations of Komatsu Limited Case Analysis

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Recommendations of Komatsu Limited Case Study Solution

On the basis of above internal and external analysis of the company along with the examination of various options, the company is advised to consider alternative 3. As alternative 3 would permit the business to broaden in global markets with no decrease in its regional revenues and any deterioration of its market position. By considering Alternative 3, the company could keep its shop experience and brand name individuality. Nevertheless, it could likewise think about alternative 2 that might enable the company to access the markets without any potential financial investment. Although, the company might pursue alternative 1 which would make it possible for the company to concentrate on possible worldwide markets rather than the regional markets however as the company is highly depending on the local markets with 90% of its stores in the US, there fore pursuing alternative 1 would result in the significant decline in company's earnings. The business is recommended to think about alternative 3.

Aletrnative-1: Expanding International Brick and Recommendations of Komatsu Limited Case Help Stores

Expansion towards international markets through opening new stores in other Europe and Asian countries with closing domestic stores is although an excellent choice for increasing the global existence of the company. However, the closing of domestic shops could extremely affect the earnings of the company as above 90% of its shops are located locally and closing those shops would eventually minimize the earnings of the company. The company has a long term market position in US which can not be created soon in the new markets. The alternative would help the company to broaden in worldwide markets together with the elimination of problems raised in its local markets connected to its variety. The benefits and drawbacks for Alternative 1 are listed below;

Pros:

• Expedition of new worldwide markets.
• Boost in revenue from worldwide markets.
• Removal of problems related to diversity.
• Profits diversity.
• Step towards being a strong international brand.

Cons:

• Loss of comprehensive revenues from the local markets.
• Increase in competition.
• Differences in cultures could resulted in a failure of the brand especially in Asian nations.
• Low earnings at preliminary levels.
• Boost in marketing expenses to gain market share.

Alternative-2: Introduction of Click and Recommendations of Komatsu Limited Case Help Stores

Alternative 2 consists of the introduction of online market places through creating an appropriate company's site. With the increased trends towards online shopping, the online stores like Amazon, Alibaba and so on could posture an extreme hazard to the marketplace share of company. Furthermore, the competitors are shifting towards click and Recommendations of Komatsu Limited Case Help stores with Gap presenting Piperline. This shift towards online markets could reduce the revenues for company. In this circumstance the company could think about presenting Click and Recommendations of Komatsu Limited Case Help stores. These shops with a low requirement of funds to settle would allow the business to reach worldwide markets, without ending its domestic shops. The advantages and disadvantages of option 2 are given as follows;

Pros:

• Low financial investment
• Reducing competition risk
• Access to the world markets
• Expanding consumer base
• Easy to manage
• Big Incomes
• Low Operating Expense
• Easy brand-new market entrance

Cons:

• Risk to the market position
• Removal of brand Originality
• Elimination of the great shop experience.
• Danger of decline in elite sales.

Alternative-3: Expansion towards International Markets Without closing Domestic Stores

Another alternative that the company might think about, is to expand towards the global markets without closing its domestic stores that contributes to the huge part of earnings of the business. The advantages and disadvantages related to Alternative 3 are given below;

Pros:

• Reducing competitors hazard
• Access to the world markets
• Increasing the size of customer base
• Big Incomes
• Exploration of brand-new global markets.
• Increase in profits from international markets.
• Income diversification.
• Action towards being a strong worldwide brand.

Cons:

• Extension of issues related to variety.
• Distinctions in cultures could led to a failure of the brand name specifically in Asian countries.
• Low revenues at initial levels.
• Increase in marketing expenses to acquire market share.



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