Recommendations of Sumitomo Corporation Of Japan The Commodity Derivatives Fiasco Case Analysis

Home >> Ibs Center For Management Research >> Sumitomo Corporation Of Japan The Commodity Derivatives Fiasco >> Recommendations

Recommendations of Sumitomo Corporation Of Japan The Commodity Derivatives Fiasco Case Study Analysis

On the basis of above internal and external analysis of the company along with the examination of various options, the company is suggested to consider alternative 3. As alternative 3 would allow the company to broaden in worldwide markets without any reduction in its local incomes and any wear and tear of its market position. By thinking about Alternative 3, the company might maintain its shop experience and brand name individuality. Nevertheless, it could likewise think about alternative 2 that could permit the business to access the markets without any potential financial investment. The company could pursue alternative 1 which would enable the company to focus on potential worldwide markets rather than the local markets but as the company is extremely reliant on the regional markets with 90% of its shops in the US, there fore pursuing option 1 would result in the substantial decline in business's profits. The company is recommended to think about alternative 3.

Aletrnative-1: Expanding International Brick and Recommendations of Sumitomo Corporation Of Japan The Commodity Derivatives Fiasco Case Solution Stores

Expansion towards international markets through opening brand-new shops in other Europe and Asian nations with closing domestic shops is although a good alternative for increasing the international presence of the business. The closing of domestic shops could highly impact the revenues of the firm as above 90% of its shops are situated domestically and closing those shops would ultimately lower the incomes of the company. Furthermore, the company has a long term market position in US which can not be produced quickly in the new markets. The option would assist the company to broaden in international markets in addition to the removal of issues raised in its regional markets related to its variety. The benefits and drawbacks for Alternative 1 are listed below;

Pros:

• Exploration of new global markets.
• Increase in revenue from global markets.
• Elimination of issues connected to diversity.
• Revenue diversification.
• Step towards being a strong international brand name.

Cons:

• Loss of comprehensive earnings from the regional markets.
• Increase in competitors.
• Distinctions in cultures could resulted in a failure of the brand name specifically in Asian countries.
• Low incomes at preliminary levels.
• Increase in marketing expenses to gain market share.

Alternative-2: Introduction of Click and Recommendations of Sumitomo Corporation Of Japan The Commodity Derivatives Fiasco Case Analysis Stores

With the increased trends towards online shopping, the online shops like Amazon, Alibaba and so on could pose a serious threat to the market share of business. In this circumstance the company might consider introducing Click and Recommendations of Sumitomo Corporation Of Japan The Commodity Derivatives Fiasco Case Solution stores. These shops with a low requirement of funds to settle would allow the business to reach global markets, without ending its domestic shops.

Pros:

• Low investment
• Reducing competitors risk
• Access to the world markets
• Enlarging consumer base
• Easy to manage
• Big Incomes
• Low Operating Costs
• Easy brand-new market entryway

Cons:

• Risk to the market position
• Removal of brand Individuality
• Removal of the fantastic shop experience.
• Danger of decrease in elite sales.

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

Another choice that the business might consider, is to broaden towards the worldwide markets without closing its domestic stores that contributes to the major part of incomes of the business. The benefits and drawbacks connected to Alternative 3 are given below;

Pros:

• Lowering competition danger
• Access to the world markets
• Enlarging consumer base
• Large Incomes
• Expedition of brand-new global markets.
• Increase in profits from global markets.
• Earnings diversification.
• Step towards being a strong global brand.

Cons:

• Continuation of concerns connected to variety.
• Distinctions in cultures could caused a failure of the brand particularly in Asian nations.
• Low incomes at initial levels.
• Increase in marketing expenses to get market share.



This is sample work and not applicable to real case study. Please place the order on the website to get your own originally done case solution.