Monday, September 30, 2019

A probate property fair market price

Chapter 4To get at a probate belongings ‘s just market monetary value What are comparables? In what manner can Multiple Listing Service ( MLS ) aid you? Vitality of existent estate agents Descrying the right agent Exercises Important TerminologyTO ARRIVE AT A PROBATE PROPERTY ‘S FAIR MARKET PRICEAs discussed earlier, equity of a belongings is its fiscal worth in the free market. We besides realized how important it is to happen out the equity of a probate belongings. To accomplish that, we require the just market value of the belongings and the debts owed on it. Honestly, you need non take excessively much hurting to happen that out and instead delegate this occupation to person more knowing and the best people for the occupation are the existent estate agents. Your occupation fundamentally is to happen out the right adult male for you capable plenty for the occupation and person you can trust on. Second, allow your agent know that your demand is to acquire the belongings sold every bit early as possible and inquire him to do offers consequently. This is critical since most agents would project the belongings ‘s just market steeper than it really is. Realistically, they ca n't be blamed for this merely because the clients are anticipating a price reduction on a monetary value put frontward to them. Another good ground for this demeanour of theirs is that the individual in ownership of the belongings of course likes his belongings to be valued at a monetary value a batch steeper than it really is and likes to hear good things about his belongings. The proprietor evidently would wish his belongings to be quoted at an overdone monetary value. Just in instance, the agent fails to make that, it is improbable that he would be employed. Therefore, it is important for the agent to understand your demand and quotation mark consequently. Stick to a peculiar agent so that you are the same page as the agent. Make him recognize that all you want is a moderate free market value of your belongings, which more frequently than non would be the existent worth of the belongings. As the clip goes by and as he gets to cognize you better, he would get at the monetary values which suit you best. That scenario is ideal since that restricts your occupation to merely reach your agent, tell him the whereabouts of the belongingss you are interested in and go forth the remainder to him since cognizing you good, it would be a cakewalk for him to acquire you the just market values.WHAT ARE COMPARABLESEstimating a belongings ‘s market worth is no walk in the park and involves a batch of analysis and research. In order to work out the just market value of a belongings the agents weigh the belongings against another belongings at par with it or against the belongingss they have traded late. The belongings whose just market value is to be calculated is termed as capable belongings. The two belongingss similar plenty to be stacked up against each other are referred to as comparables. By analyzing the comparables, agents are able to gauge the monetary values of a peculiar sort of belongings within a peculiar part or vicinity. Therefore, the capable belongings is weighed against some of the comparables which were sold recently in a peculiar vicinity. It is clear that the just market value of the capable belongings would be at that place and thereabouts merely. The best attack to place the just market value is the usage of comparables. For the belongingss to be comparables, they must portion certain properties ( those listed in class 1 ) .Class 1The architecture of the belongingss being compared should be indistinguishableThe comparables should be likewise when it comes to the figure of suites. Besides, the comparables should be identical on the footing of figure of sleeping rooms and bathrooms.Most significantly, the houses should belong to a peculiar country or a part merely since the monetary values may change significantly with location.The dimensions of the comparables should be indistinguishableCategory 2 lists certain features that can impact a house ‘s value well depending on whether it possesses those features or non. Sometimes it is non possible to happen comparables with exactly the same features as our capable belongings. If the comparables have some additions or any extra fortes as compared to our capable belongings, so just market value of the capable belongings is needed to be decreased consequently and thoughtfully. Similarly, if the topic belongings has something the comparables do n't, so that must add to its value suitably. For case, if the capable belongings possesses an extra cellar or parking batch or anything for that affair which the comparables do n't so you must add up to its value suitably and it goes without stating that this works the other manner unit of ammunition every bit good when your capable belongings is short of something present in the comparables. Again, you must hold your agent sitting by your side and loaning you a much needed assisting manus. So, ne'er add onto or deduct from the just market value of belongings without the consent of your agent. Category 2 lists the specifications that may rise your belongings ‘s value ( or the other manner unit of ammunition )Class 2An fond regard like a shop room or possibly a public-service corporation roomOne or more than one parking tonssFireplace or something like thatCentral air conditioningAn extra lower floor ( cellar )The additions listed above can truly hike or keep back the value of your probate house appreciably. Another set of additions mentioned below that may non hold excessively much deduction on the value of belongings but alternatively do it more attention-getting constitute our 3rd class. If your house has those characteristics, it will surely hold an upper manus over comparable belongingss in that peculiar vicinity that may non be holding those characteristics.Class 3A galleryAn unroofed deckA well maintain lawn or a gardenGreenery like tidy shrubs, cosmetic trees, etc.A little extra parking countryTip: We merely saw how some properties can increase a belongings ‘s cost appreciably but at the same clip certain supernumeraries may go an extra luggage and diminish its marketability. For case, a swimming pool, which may be viewed as an sweetening by a subdivision of people, but it ‘s besides something which may do your house harder to sell. This is since most of the belongings purchasers are bound to be freshly married people with really immature childs. Kids we know are unpredictable and it would surely non be advisable for the parents to travel for such place. These immature people form a major part of the homebuyer ‘s community. Besides, most of these people would be looking for some kind of an adjustment every bit early as possible and by and large maintaining the pool in good form wo n't be excessively easy on their pockets. You merely can non afford to lose so many possible purchasers. At the same clip, another subdivision of people to whom fundss or childs or anything is non a affair of concern would ne'er mind holding a swimming pool at their disposal. Summarizing it up, such additions should non do excessively much of a difference to you while measuring a house. Those were the three classs which must be taken into consideration while ciphering its just market monetary value. As mentioned above, classs 1 and 2 are peculiarly indispensable since they affect the value of the house appreciably. Anyhow, class 3 which does n't hold much deduction over the house ‘s value can non be neglected. Once you have been in touch with an agent for a period of clip, you will be good equipped to find the just market value by yourself rapidly and accurately. The belongingss which are similar to the capable belongings and have been sold in the recent yesteryear must be taken into history. Properties sold within the last six months are 1s which must be taken into history. Properties beyond that period can non be considered recent plenty to be used as comparable belongingss. It is the responsibility of the existent estate agent to analyze all the available comparables and find the just market value accurately. The state of affairs where no comparables are available is non excessively uncommon or a one-off thing. It does go on on a regular basis and in that instance the agent may hold to travel back by a twelvemonth or even more to happen the comparables sold in the vicinity. He should believe twice earlier seting up any monetary value since belongings values may change drastically with such an interval of clip.How to find the just market value without utilizing comparablesIn some vicinities, where houses are every bit old as 30 old ages or even more it becomes difficult to come up with comparables. This is because most of the houses during that period were customized as per the likings of the proprietors. The contractors ( or designers ) used to build houses with different forms within a vicinity during that period. Furthermore, since these houses are rather old, most of those would be altered well. Changes may be attaching another room to the house, widening it, adding another floor etc, and these things over a period of clip make sure that the house is far from its original signifier. Since the deceased, go forthing behind the probate belongings would largely be an elderly individual ; opportunities that the belongings is located in older vicinities are good and in that instance it would be truly difficult to happen the comparables. Without any comparables, you will hold a tough clip measuring the house ‘s just market value. Try to calculate out the houses which have the closest of resemblance to the topic house by comparing the properties in class 1 and so of class you can do suited add-ons or minuss on the value depending on the additions mentioned antecedently. Once once more it is your existent estate agent who comes to deliver. Rely on him to cipher the just market value accurately. It is ne'er a bad thought to listen to another agent ‘s point of position if you are still diffident of the value. The idea of holding other agents to discourse with your agent may besides be fruitful. These are the rudimentss when you are looking to cipher the just market value and it wo n't take you long to get the hang the art. Merely maintain it simple, utilize the comparables and maintain in touch with your agents. You would come across different sorts of probate places. A probate house may be a individual household place, a townhouse or a condominium.How to find just market value of townhouses?Townhouses or row houses are by and large those houses that are joined utilizing a common sidewall. When it comes to finding the just market value, townhouses are comparatively simpler than individual household places. Let ‘s take a expression at the grounds for it:Townhouses in a vicinity are by and large built on the same forms. Even if they do differ, there merely are a few forms that exist in a subdivisionMore frequently than non the proprietors are non permitted to build any additions on their houses by the subdivisions.The few things that proprietors may be permitted to make in order to hike their house ‘s market value areConstruction of an extra sleeping room in the lower floor ( cellar )Build an extra bathroomOther features that you may desire to cognize about the house may be the inclusion of assorted types of Windowss, floors, deck, etc. Although they are n't likely to hold an consequence on the just market value, but they can surely be things to do a note of. The basicss remain the same though, i.e. the size of the belongings, figure of sleeping rooms and bathrooms, form on which it is built, dimensions, etc. Of class properties like excess bathroom, a car port, or a hearth do hold a positive affect on the market value. It is good known that the corner houses are of somewhat more value than the 1s sandwiches between two houses. The grounds are good known excessively. Normally, the corner houses have a somewhat larger country. They are three side unfastened and two-side unfastened like the interior 1s. They portion sidewalls with merely a individual neighboring house. Townhouses form serious belongingss to take at since they ca n't be altered much and besides, happening their carnival market value is rather easy because there are so many comparables to look at.How to happen just market value of condominiumsCondominium refers to one of the units in a multi unit composite. Here once more, finding the just market value is non excessively large a trade. Merely name up your agent, he would measure the house based on legion comparables by and large available for condos. Second, since alterations are rarely allowed in condos, proprietors have their custodies tied in instance attempt to heighten the market value of their house. Condos with characteristics like modular kitchen, wooden cabinets or some type of particular flooring may be somewhat in front than others, but non by much.Analyze the competitionAssign your existent estate agent the undertaking of finding what the proprietors of comparable belongingss are demanding for selling their houses. This will give you a clear indicant on what monetary value you need to set up your belongings for sale. Be cautious and ne'er think of this information to measure the just market monetary value since proprietors are bound to cite excessively much more than what the belongings is really deserving. Fair market value can merely be calculated on the footing of belongingss already sold and non on the 1s that are on sale at present. Your mark is to acquire your belongings sold every bit shortly as possible. Buying a probate house is easy on the pocket and hence you can inquire for monetary values moderately lower than the monetary values of the comparables. This would vouch a speedy sale and a significant yet speedy fiscal addition.When to utilize valuatorsAppraisers are those persons who have expertise in ciphering the just market value of belongingss. You should avail of their services merely if you and your agent are unable to find the just market value of a house. This can go on when you merely are n't able to happen any comparables. So, when person does offer you a large price reduction on his house and you find yourself incapacitated, turn to valuators. The valuators are knowing plenty to measure the just market value of the house from comparables belonging to non merely the same, but besides from other nearby vicinities in that peculiar country. From comparing the capable belongings to the comparables to doing suited add-ons and minuss on the just market value depending on the additions contained by the comparable, an valuator would make it all for you. Still, you are advised to do usage of them merely in instance both you and your agent are unable to happen the just market value by yourself since valuators would and intelligibly so bear down you a fee for their services.No replacement to difficult work!In instance you are a newbie in trading belongingss and material, it is recommended that you do the difficult paces and pattern measuring the just market value by yourself. Find some probate places, inquire your agent for suited comparables and visit those comparables along with your agent. You do the comparing by yourself, analyze whether or non the comparables resemble the topic belongings closely adequate and seek to find the just market value consequently. Do non bury to see some of the nearby occupants. Gather as much information as you can about the belongingss in that peculiar vicinity. These following door neighbours will be more than willing to portion their sentiment peculiarly when you tell them that you are their prospective neighbour.WHAT IS MULTIPLE LISTING SERVICE ( MLS ) AND IN WHAT WAY CAN IT ASSIST YOU?MLS is the abbreviation for multiple listing services and it is a service which can be accessed via computing machines merely. It is the multiple listing service merely through which agents are able to calculate out the comparables for a given capable belongings. All existent estate bureaus subscribe to the MLS and supply its entree to all the agents working with the bureau. It may be that the agent is a endorser, and does n't necessitate any bureaus to avail of the MLS. A belongings that is available for purchasing at present is termed as a listing. Therefore naming service is service which has 1000s of listings and has the information of all the belongingss that are presently on sale. Therefore, the existent estate agents make usage of the MLS to happen out the comparables for a capable belongings. Whenever you appoint an agent and assign him the undertaking of selling your house, he enters the listing in the MLS and makes it existing in the market. Since this list is carefully looked upon by all the agents, it gives your belongings a good adequate exposure in the market. MLS is regarded as a must hold tool for all agents. MLS provides the agent with plentifulness of information. It has the list of all the belongingss sold within last 12 months in a peculiar country and besides comprehensive information sing them. The agent ‘s occupation is to shop through the consequences generated as he enters a few variables and make a elaborate survey based on these consequences. These variables may be the purchaser ‘s budget, size or form of the house, the coveted location, and the MLS will bring forth the list of all the belongingss fulfilling these parametric quantities. The simpleness and the user friendliness of the MLS are astonishing. For case, you call up your agent and inquire him to measure the just market value of a certain probate house. You tell him about the figure of sleeping rooms, bathrooms, and the location etc of the house. Now, all your agent demands to make is to come in all these factors in the hunt field of the MLS. Leave the remainder to the MLS. The MLS will so bring forth a list of all the houses purchased with the same specifications. So many comparables are available that the occupation of finding the just market value becomes a batch easier. MLS makes certain that finding the just market value of any belongings is merely a affair of proceedingss once you and your agent are accustomed to it.VITALITY OF REAL ESTATE AGENTSThe recognition for the gross revenues of most of the bank foreclosures in Canada goes to the existent estate agents. These are competent salesmen who are employed when belongings proprietors intend to sell their belongingss. Real estate agents are skilled people who are likely to give you an advantage and hike the opportunities of a speedy and a paid sale by springs and bounds. Real estate agents want a small of the gross revenues made through them. They would by and large inquire for a 3 to 6 % portion of the entire sale value. The agent ‘s portion is non fixed and it varies with different agents and different trades, though by and large, they stick to 6 % of the entire monetary value the house is sold for. This is because 8 out of 10 times your agent wo n't be straight in contact with the purchaser but through another agent. In that instance, the committee will be divided between the two agents. The original agent will acquire merely 3 % and non the full 6 % . If the purchaser is in contact with any agent other than yours, even so your agent deserves his piece. This is because it is your agent who has promoted your belongings and set in a batch of his valuable clip and energy into it. It is his contacts that have helped you find a purchaser In fact, your agent besides supervises the full procedure of sale of your belongings along with the other agent. You will recognize that 6 % for a skilled agent is non at all a bad trade. It is your agent that will pass on all the advertisement and selling of your belongings. Frosting on the bar is the fact that an agent will non demand anything until your house has been purchased by the purchaser and all the paperwork has been taken attention of. They will acquire their portion automatically within the procedure of the trade. You do non pay their portion straight and they earn it automatically as the belongings is sold. You can besides choose for going an agent yourself. It is ne'er a bad thought since it wo n't affect excessively much of an investing, though on a personal degree, I have ne'er aspired to be an agent myself. Trading in probate houses works good for me. That surely does n't intend that you ca n't do good money being an agent. You can ever make that. The pick is all yours. Once you have managed to buy a inexpensive probate belongings, the agent ensures your smooth seafaring through the procedure of sale of the belongings. Second, the agents are ever up-to-date with all the latest and relevant information. He is the 1 who will ever be holding the MLS at his disposal and will besides find the just market value for your capable belongings. Time to hold a closer expression at the necessity of holding an agent: First of wholly, your occupation is to near an agent and assign him the undertaking of pull offing the sale of your belongings from happening a purchaser to the shutting of the trade. Then that agent will execute all the actions necessary to guarantee a quick and a profitable sale. Different maps performed by an agent are:Agents are ever in touch with many other agents. So, he will do all of them cognizant of your belongings and that it is up for sale.He will popularise your house in relevant magazines and besides guarantee proper advertizements through newspapers.He will be registering the belongings in MLS, guaranting its being in the market.His occupation besides includes distributing or passing out the flyers sing your belongings to those shacking in the same country on rent. Since you are willing to sell your belongings at an low-cost monetary value, the flyers should be good plenty to convert them to purchase the house you are offering.He will descry the weak links which may decrease your belongings ‘s value like possibly dust loaded Windowss or something like thatSimilarly, he will besides allow you cognize how you can heighten your belongings ‘s market worth.He will set up your belongings as an unfastened house and besides publicize it in ne wspapers. It means any interested purchaser may come and inspect the house which is held â€Å"open† and does n't even necessitate to reach the agent for that. This is by and large done on Sundays so that most of the possible can come and hold a expression in.Apart from all these, there are legion other services your agent will ease you with. He will besides impart a assisting manus to the purchaser as to how to set up the fundss or arrange loans for him that he requires to purchase your house. He will take attention of all the certification portion as good.A skilled existent estate agent will: –Be cognizant of yours and the adjoining vicinities and how things work at that place.Help you realize where to pass and where non toAid you to measure the just market valueDo non overlook your agent ‘s advice. Make take notice of it that would by and large maintain you out of troubled Waterss.What are Listing Agreements?Delegating the agent the occupation of selling your belongings requires you to subscribe a contract. This contract is called listing understanding. This listing understanding allows the agent to sell your belongings. All the footings and conditions sing the sale of the belongings are mentioned in the understanding. They are by and large non more than three-to-six months long and besides stipulate the agent ‘s portion in the merchandising monetary value of the belongings. An agent ‘s liking for a longer listing understanding is apprehensible since it non merely boosts his opportunities of happening you a purchaser but besides of another agent in touch with him of making so. It is advisable for you to non hold a listing understanding of over three months. In instance the agent is unable to sell your belongings within that tine frame, so either you are citing excessively high or your belongings is non in the best of forms. So make sure that you evaluate the just market value accurately and non anticipate excessively much from your belongings. Besides guarantee that your belongings is in the best of its wellness and put it up for sale at monetary values moderately lower as compared to other similar belongingss. You should be really selective about the location every bit good as the vicinity you invest in to do certain selling the belongings does n't go another hurdle in your manner. Listing understanding provides the agent with the comfort of selling your belongings over a defined period ( of three months ) . Listing understanding must advert that your house will be registered in the MLS, merely in instance you come across an agent who unluckily is n't excessively interested in profiting you. They may non desire to name your belongings in the MLS so as to avoid sharing of the committee with another agent. This is n't likely to go on though at that place a few egoistic agents around so be careful. To avoid any such jobs, do allow your agent cognize your demands and besides inquire him about the scheme he is traveling to use. Have healthy, blunt and frequent treatments with your agent and border the listing understanding consequently. You can ever maintain path of the proceedings to foster safeguard your iterests.Descrying THE RIGHT AGENTFor person comparatively new to the belongings concern, a competent agent is a necessity. First of all, seek to remember if you yourself are in contact with any agent. There is nil like holding a household member or a close buddy or anyone as dependable to help you. Then think of person who has sold his belongings recently and inquire him to acquire you his agent. Open your Yellow Pages directory and happen the contact information of nearby real property offices under â€Å"real estate† . Enlist some of the agents of your country. Shortlist the agents and get down taking telephonic interviews of the short listed 1s. Do non merely interview and engage an agent straight off ; do do certain that you talk to a few of them so as to guarantee your compatibility with the agent. From the existent estate bureau itself, acquire contacted about the agents who have been working with belongings investors. These agents are more likely to understand your demand of reaping good income from the belongingss you purchase. State the agent that he is the 1 who needs to happen out the profitable belongingss so that you can put in them and do good money. Let him cognize that you want him to state you about all the pros and cons of purchasing a house in bordering vicinities and maintain you informed about the high potency every bit good as those that are n't likely to do you great net incomes. Work with merely those agents to whom you are one of the top precedences. Convey to him that are looking to put in a figure of belongingss and non merely in a individual 1 and will work with him on a figure of trades. Tell him that you would necessitate the information you ask for immediately without any holds and that you may necessitate to reach him rather a few times in a twenty-four hours. This is besides indispensable since agents are a busy batch and some of them may non go to to you decently.Tip: –After questioning a few agents you will recognize that all of them are more than happy to work for you. While acquiring you an agent is no large trade, descrying a competent agent does necessitate some making. So do take the hurting of questioning a few agents ( three at the least ) before you hire one. Take your clip and make non seek to hotfoot to following measure as an unqualified agent may impact your income badly. An agent ‘s competency or the deficiency of it will be apparent to you reasonably rapidly.What to inquire an agent while questioning him?Do you hold any experience in working with investors?If the reply is no, see another agent who has worked with investors before. Do state him that you are here to reap a significant income. Convey to him that you want to put in merely those belongingss that wo n't take excessively long to sell and that you need your pecuniary benefits every bit early as possible. Tell him that it is his occupation to allow you cognize approximately profitable every bit good as uneconomical vicinities. As you have managed inexpensive belongings yourself, state the agent that you mind offering a sensible price reduction for it either. This should ease your agent in marketing your house. It should be bread and butter for the agent to sell the most low-cost belongings ( than other comparables ) in a peculiar vicinity.How experienced an agent are you?The longer the individual has been working as an agent, the more experient he is. More experience surely means more chance of being acquiring you a good trade. While questioning the agents, figure out whether you need a really experient agent or person comparatively new. Now you must be believing â€Å"why should I be even believing about person new in the business† ? The ground is simple. Simply because person less experient looking to do a grade is bound to demo more enthusiasm and dedication towards the occupation.Can I reach you in the uneven hours like early in the forenoon or possibly at midnight as per the demand arises and would be able to supply me the feedback accurately and rapidly plenty?I am willing to put in a figure of belongingss in a twelvemonth, and would wish to find the just market values of a batch of houses. Can you save that much sum of clip for me?Do do sure you clearly ask the agents all of the above and any other things that you think are necessary to discourse.Exercise___________ ( executors/agents ) are the 1s who determine the just market value of a belongings for you.The belongings whose just market value is to be calculated is termed as ________ belongings.____________ are those persons who have expertise in ciphering the just market value of belongingss.____________ greatly assists the agents to happen comparables f or a capable belongings._____________ is a service which has 1000s of listings and has the information of all the belongingss that are presently on sale.The _______________ allows the agent to sell your belongings.IMPORTANT TERMINOLGYFAIR MARKET VALUEReal ESTATE AGENTAppraiserTOWNHOUSECondominiumCOMPARABLESListList AGREEMENTMULTIPLE LISTING SERVICE ( MLS )

Sunday, September 29, 2019

The Global Cement Industry and Cemex’s Penetration Strategy Into International Markets

The Global Cement Industry and Cemex’s Penetration Strategy into International Markets My report argues that demand and capacity creation in developing economies is a major driver in the global cement industry, which given the nature of the product (high transportation costs arising from its bulk) is prone to major company expansion by mergers and acquisitions. Cemex’s expansion strategy focuses on merger and acquisition (M&A), mainly exploiting its expertise of operating in difficult institutional environments and taking advantage of opportunities arising from difficulties in developing market economies.The company successfully adapts best practice and technologies from its acquisitions throughout the wider company. My report begins with definitions, presents an overview of the global cement industry (section two) key players in the industry (section three) and M&A trends (section four). I then analyse Cemex’s entry strategies by exploring in turn the regions in to which it has expanded (section five) drawing conclusions on its penetration strategy. 1Introduction and definitionsCement is a binding substance, which sets and hardens independently binding other materials together. It is intended for use in building or construction material and can withstand varying environmental conditions. About 75% of cement production is used in ready-mixed concrete to be utilized in construction. The remaining 25%, Portland Cement Association (2009) shows, is used for paving roads or extracting oil. As Selim and Salem (2010) indicate basic raw materials for cement production are iron, aluminium, silicon and calcium.Normally cement is divided as Portland cement, Portland cement blends and non-Portland hydraulic cements. Portland cement, which can be roughly divided into White Portland and Gray Portland, is the most commonly used type as it is the basic ingredient of concrete (Cemex, 2013a, PCA, 2013). There are two different processes used in the manufactur e of cement – dry process and wet process. In the wet process, the raw materials, after properly proportioned, are ground with water, thoroughly mixed and fed into the kiln in the form of a â€Å"slurry† (containing enough water to make it fluid).In the dry process, raw materials are ground, mixed, and fed to the kiln in a dry state instead. In other respects, the two processes are essentially alike (PCA, 2013). However, the dry process was considered to be more sufficient than the wet one since it consumes less energy. On the other hand, the dry process requires more investment in equipment and plants. Cement manufactures in developing countries have widely adopted the wet process but the transformation to the dry process is underway on a large scale. 2An overview of the global cement industryThis section discusses the nature of the global cement industry, including the market size and market potential, the nature of cement products, market supply and demand and relat ed environmental issues, to provide a broad view to understand the nature of competition. The following are the main characteristics of the global cement industry. Huge market – especially emerging markets Cement is the primary and indispensable material in infrastructure construction for every country. Although it only accounts for around 6–13% in construction costs (Chandramouli, 2012), there are few substitutes for it (Wesley, 2009).Hence there is a potential huge global market with strong contracts between developed and developing countries. While the developed countries mostly have steady and limited demand for cement, the developing world is a more promising market, as a result of large-scale constructions: the demand of cement is positively correlated with a nation’s economic development. World demand for cement is growing by 4. 7% per annum reaching 6% growth in 2012, with total consumption of 3. 78 million tons (CW Group, 2012).Consumption in developing countries drives this growth in Latin America, Central and Eastern Europe, and the Middle East regions; China is the strongest driver. In contract, consumption in Europe has been stalled and the growth rate of consumption in the US is a steady 2%. Therefore, developing countries are the main drivers of the growth in cement demand – a trajectory likely to continue. Cost is dominated by oil price and transportation Due to the specificity of cement products, in the cement industry, oil price and transportation cost are dominant factors affecting cost.The cement industry is energy intensive and thus fuel costs is the most critical part in cement manufacturing, constituting 35% of total cost of production (Das, 2011). Therefore, the fluctuation of fuel price, especially oil price, has impacts greatly on production cost. During the first quarter of 2012, the oil price had kept rising and was 12% up by the end of 2011. At that time, the cement industry increased prices to cover hig her fuel cost. In June 2012, Caribbean Cement Company Limited increased the price of bagged cement by 9. %, and the company claimed that its ex-factory was still among the lowest in five other regional markets. Cement is, clearly, a type of high weight-to-price ratio product and it is usually purchased in bulk. As a consequence, transportation expenditure is relatively high and restricts the spatial reach of markets. It is more feasible to produce cement domestically or to import cement products from neighbouring countries to reduce the transportation fee. Hence, the scale of international cement trade is small (5%-7%) when compared with total cement production worldwide (Selim and Salem, 2010).The demand of cement can be unpredictable Since cement production is largely dependent on infrastructure constructions, as Wesley (2009) argues, national construction polices and projects drives demand: sales volume is more sensitive to construction levels than to price. Over the long-term pe rspective, changes in social factors such as population and economic growth also affect cement consumption. The residential day-to-day demand for cement can be uncertain; it may be disrupted by unexpected situations such as bad weather (Wesley, 2009). Constantly related with environmental issuesAlthough cement is locally produced in most cases, the impact of cement production is global, especially its environmental aspects; as Selim and Salem (2010) argues. The mass production with high-energy consumption brings pollution, producing 5% of the world’s total emission of greenhouse gases Loreti (2008) and Uwasu et al. (2012) estimate This pollution is produced mainly in developing countries, which are the main production locations of cement. China alone, being the world’s leader in carbon dioxide emission and cement production, has 15% of its emission contributed by cement the World Resources Institute (2008) suggests.The environmental issue becomes extremely urgent and p ushes major global players to set up stricter emission standards on the cement industry. 3Top players and in global cement industry The table below shows the largest 20 cement producers in the world. It can be seen that top global players in this industry are either from Western Europe or from emerging markets, especially China. Rank| Company/Group| Country| Capacity (Mt/yr)| No. of plants| 1| Lafarge| France| 225| 166| 2| Holcim| Switzerland| 217| 149| 3| CNBM| China| 200| 69| 4| Anhui Conch| China| 180| 34| 5| Heidelberg Cement| Germany| 118| 71| | Jidong| China| 100| 100| 7| Cemex| Mexico| 96| 61| 8| China Resources| China| 89| 16| 9| Sinoma| China| 87| 24| 10| Shanshui| China| 84| 13| 11| Italcementi| Italy| 74| 55| 12| Taiwan Cement| Taiwan| 70| -| 13| Votorantim*| Brazil| 57| 37| 14| CRH**| Ireland| 56| 11| 15| UltraTech| India| 53| 12| 16| Huaxin| China| 52| 51| 17| Buzzi| Italy| 45| 39| 18| Eurocement| Russia| 40| 16| 19| Tianrui| China| 35| 11| 20| Jaypee***| India| 34| 16| Table 1 Global cement companies 1-20 ranked by capacity Source: Global Cement Magazine, 2012 * Includes 15Mt/yr of capacity from Cimpor shares. * Cement capacity calculated from clinker capacity assuming clinker factor of 95%. ***As in April 2012. Table 2 indicates top cement producing countries – again, fast-developing countries are the main force driving cement production. Rank| Country| Capacity (Mt)| 1| China| 2000| 2| India| 210| 3| USA (inc. Puerto Rico)| 68. 4| 4| Turkey| 64| 5| Brazil| 62. 6| 6| Russia| 52| 7| Iran| 52| 8| Vietnam| 50| 9| Japan| 47| 10| Korea, Republic of| 46| 11| Egypt| 45| 12| Saudi Arabia | 44| 13| Thailand| 36| 14| Italy| 35| 15| Mexico| 35| 16| Germany| 33| 17| Pakistan| 30| 18| Indonesia| 22| 19| Spain| 20. 7| Other countries (rounded)| 480| | World total (rounded)| 3400| Table 2: Top global cement producing countries by installed capacity (2011, estimated) Source: Mineral Commodity Summaries 2012 From the tables above, it can be concluded that China is the leader in both cement production and consumption due to its large scale infrastructure construction and fast development, representing more than half of the world’s total consumption. India follows China as the second largest consumer while also having large producing capacity. The United States is the largest cement consumer in the developed world. Major M&A trends As the Economist (1999) illustrates, larger players in the cement sector frequently undertake mergers and acquisitions (M&A) domestically and globally, to increase market share and benefit from economies of scale. The Economist goes on to argue that this high level of M&A activity is driven by the nature of the cement industry since cement production is localised and transportation costs are high; thus global producers need to purchase local companies to enter new markets, especially when a domestic market is saturated or in downturn.Since the 1970s, the cement industry in the developed world has bee n saturated and there is little space for market expansion. Developing countries have consequently become the target market for expanding new capacity and seizing market share a trend clear since the 1990s. The industry is therefore becoming more of a monopoly with oligarchic key players taking the important decisions, making M&A decisions, guided of course by changing economic and market conditions. In the 1990s, global cement giants saw great opportunities for M&A and competed to purchase market share in rapidly developing markets at good prices.For example, the Mexican Peso crisis (1994) resulted in a currency flight to US dollars and Peso devaluation, a situation Cemex turned to their advantage, Wesley (2009) argues, by purchasing Latin American cement companies at undervalued prices. Similarly, after the Asian financial crisis in 1997, the Asian cement industry fell into a downturn. Global cement giants took advantage and purchased leading cement companies in the Philippines, T hailand and Indonesia as bargains.At that time, six global giants purchased seventeen of the nineteen Philippine cement companies leaving Lafarge, Holcim and Cemex controlling 88% of the nation’s cement capacity. When the regional economy recovered, Cembusiness (2006) suggests, the price of cement rose again quickly and these multinational giants benefited from huge profits in Southeast Asia. 5Cemex’s entry strategy into international markets Cemex is currently the world’s third largest cement producer headquartered in Monterrey, Mexico.Although Cemex founded 107 years ago, it had been a domestic player for its first 80 years and did not start its global expansion until the 1990s. Its M&A progress has been remarkable: it now operates profitably in 50 countries in the world with 44000 employees and annual sales of US$15. 14 billion (Cemex, 2013a). In general, as Hill (2008) points out, a firm’s entry modes into foreign markets include exporting, contracts (licensing or franchising), foreign direct investment (joint venture and wholly owned subsidiary, including M&A) and strategic alliances.As discussed above, global cement giants, including Cemex, mainly enter foreign markets through M&A. Specifically, as a global player from an emerging market, Cemex needs to build its own competitive advantage during its internationalisation processes to cope with its disadvantageous competitive position vis-a-vis companies from developed countries. In short, Cemex is diversifying its market position through internationalisation (Liu, 2013). As Cemex’s expansion history extends spatially, I now turn to discuss its entry strategies into the global market by regions, which are shown in table 3. Cement production capacity (Million metric tons/year)| Cement plants controlled| Sales (millions of US dollars)| Mexico| 29. 3| 15| 3,474| United States| 17. 1| 13| 2,521| Northern Europe| 11. 9| 7| 4,729| Mediterranean| 18. 8| 12| 1,719| South, Central America and the Caribbean| 12. 8| 11| 1,745| Asia| 5. 7| 3| 505| Others| -| -| 445| Total| 95. 6| 61| 15,139| Table 3: Global review of Cemex’s operations As of December 31, 2011 Source: Cemex Annual Report 2011 Europe Europe was Cemex’s first step in global expansion.In July 1992, as Wesley (2009) reports, Cemex acquired two of the largest cement companies – Valenciana and Sanson – in Spain, with Valenciana becoming its regional hub holding company for all of Cemex’s future international acquisitions. However, significant movement into Spain, Europe did not become the main destination of Cemex as this region had limited potential for growth. More importantly, European players such as the French Lafarge and German Heidelberg controlled the European region.These European giants had advantages of scale, market share and advanced technology. What Cemex needed was not only the action of acquiring: it needed the advantages of the post-merger integratio n to catch up and improve. After purchasing Valenciana and Sanson, Cemex integrated its two Spanish subsidiaries by merging and streamlining the organisations and improved its technological and operational implementation. Cemex’s other substantial step in Europe was the purchase in 2005 of RMC, the world’s largest producer of ready-mixed concrete based in the UK.With this acquisition Cemex doubled its size, adding 20 mainly European markets (Cemex, 2013a) and managed to extend its product mix, becoming top producers of not only cement but also concrete and other construction aggregate (China Cement Net, 2005). Latin America Cemex made a series of acquisitions in Latin America, benefiting from the close psychic distance and geographic proximity to Mexico. Furthermore, in the 1990s, Latin America was an underdeveloped market with a high growth trajectory.Although at that time, Latin American countries were in a turbulent political and institutional condition with poor in frastructure and limited market information, Cemex viewed these conditions as advantages Fleury and Fleury (2011) argue, exploiting its experience in dealing with chaotic market environments in its home country and captured the opportune moment of the Peso crisis in 1994. Cemex moved into Latin America, including Central America and the Caribbean, by acquisitions in Venezuela (1994), Panama (1994), Dominican republic (1995), Colombia (1996), Costa Rica (1999), Nicaragua (2001), and Puerto Rican (2002) (see Cemex, 2013a).Latin America has been an important destination for Cemex, especially in the decade since the Peso crisis. During this decade foreign cement giants divided up the Latin American market due to the collapse of local producers and Cemex gained the dominant position. After acquiring those companies, Lessard and Reavis (2009) suggest, Cemex also upgraded its administration, production and technologies in this region, exploiting learning from the company’s operation s in Mexico and Spain. Although Cemex has a noteworthy presence in Latin American countries, its production capacity in South,Central America and the Caribbean accounts for only 13. 4% of its total sales in 2011, less than its capacity in the United States, Northern Europe and Mediterranean respectively and less than half of its domestic capacity (Cemex, 2011). However, there has been a rapid increase in South America and the Caribbean since mid-2000s, as a result of higher levels of public expenditure on infrastructure, industrial and commercial development and housing construction (United Nations ECLAC, 2007).Hence Cemex controls its closest emerging market area, with the exception of Brazil. The USA The United States, unlike other developed countries, remains a major consumer and producer of cement products; however, few its cement producers are American-owned. In the 1970s, Wesley (2009) points out, when Cemex was a domestic firm, most US cement producers were already taken over by European companies. Cemex’s significant incursion into US market was the purchase of American producer Southdown in 2000.Southdown was one of the largest American cement producers and it was state-owned. Cemex’s purchase followed a 20-year joint venture with Southdown called Sunbelt in 1986: following disagreements on management fees and the price of imported cement, the partnership dissolved and Southdown supported anti-dumping measures against Mexican producers (Wesley, 2009). By late 1990s, Southdown was making profits from its upgraded plants and lower costs whilst unsatisfactorily performing on the stock market, enabling Cemex to buy Southdown for $2. billion in November 2000 (Cemex, 2000), becoming North America’s largest cement producer, obtaining Sothdown’s advanced production capacity and markets and circumventing anti-dumping duties. Another Cemex step into North America (Black, 2007) was the purchase of the Rinker Corporation, an Australia- based concrete maker that had about 80% of its sales in the US, notably increasing its share of the U. S. concrete market. Asia Cemex turned its attention into Asia after 1997, seeing the potential in Asian growth and M&A opportunities following the financial crisis in southeast Asia (Wesley, 2009).In the next few years, Cemex made acquisitions in the Philippines, Indonesia, Thailand and India. Following rapid economic development and large-scale construction in Asia, by 2011 Cemex only managed to have the capacity of 5. 7 million metric tons in this region, representing only 6% of Cemex global capacity. Cemex failed to gain significant market share in China and India, the two largest Asian cement markets: the company continues to pay attention to the burgeoning Chinese and Indian markets (China Cement Net, 2005), however, institutional restrictions inhibit its growth.Indeed, the cement industry in China has excess capacity following slowdown in construction growth: many cement plan ts having been built during the boom. Currently Cemex does not have specific expansion plan of for China although it expresses a lot of interest (China Cement Net, 2006). In India, Cemex is more positive and in negotiations to acquire several Indian producers. Middle East and Africa (MENA) In 1999, Cemex acquired Assiut Cement Company, the largest cement producer in Egypt, started operating in Africa and increased its capacity following acquisitions (Wesley, 2009).Cemex also has operations in Israel and United Arab Emirates. The total presence in Middle East and Africa is limited since the African cement market is underdeveloped and as Digital Cement (2010) point out, the MENA cement markets are locally controlled. In summary, Cemex’s expansion into the global market is not only the strategic choice about competing and bidding for acquisitions, but also the integration process that ensued, as an opportunity to drive change, and as a result, continuously evolve as a corporatio n (Lessard and Reavis, 2009). 6ConclusionsCemex’s penetration strategy is shaped by the nature of the product and structure of the industry. Since cement is bulky and costly to transport global-global entry strategies are unavailable to it. The industry structure reflects the product in a wide array of regional-scale producers. Like other major players in the industry (such as Lafarge, Holcim and Heidelber) has sought to penetrate international markets by M&A rather than direct investment, strategic alliances or licensing. Another characteristic of the global cement industry is that developing economies are the drivers of demand.Often these markets remain difficult to enter being overly regulated, protected or subject to corruption and political interference. Cemex uses its origins in a developing market as an advantage: the company has expertise in overcoming these barriers, knowledge it has successfully exploited in numerous markets. Additionally, Cemex has taken advantage of other adverse trading conditions in its target markets (Asian financial crisis, Peso crisis) to conclude M&A deals when target company prices are depressed. Bibliography 1. Black, T. , 2007.Cemex Wins Control of Rinker With $14. 2 Billion Offer (Update3). [online] Available at: . 2. Chandramouli, R. , 2012. Cement contributes to less than 10% of construction cost. The Times of India. [online] Available at: . 3. Cembusiness, 2006. (The opportunities in the cement industry under the upsurge of international industrial capital M&A). online] Available at: . 4. Cemex, 2000. Annual Report 2000. [PDF] Available at: [last accessed 28/02/2013]. 5. Cemex, 2011. Annual Report 2011. [PDF] Available at: . 6. Cemex, 2013a. About us. [online] Available at: . 7. Cemex, 2013b. Product and Services. [online] Available at: . 8. China Cement Net, 2005. â€Å" †Ã¢â‚¬â€Ã¢â‚¬â€? CEMEX †¢ (The master of acquisition – interviewing Armando Garcia, executive director of Cemex). [onli ne] Available at: . 9. China Cement Net, 2006. Cemex (Cemex clearly expresses its interests in the Chinese market). [online] Available at: . 10. CW Group, 2012. CW Group: Global cement demand to reach 4bn tons by 2013. CemWeek. [online] Available at:

Saturday, September 28, 2019

Executive summary Essay Example | Topics and Well Written Essays - 500 words - 1

Executive summary - Essay Example However, he did not provide concrete assurance of the accounting tactic. This puts the financial position of pension companies at stake. In addition, this is controversial since the move could undermine governments efforts to support, by placing against something solid or rigid, the pension system. As a result, workers worry on the strain the tactic will put on other government agencies designed to protect the retirement of workers. The policy make companies pile up pension bills. In the end, companies struggle to keep up with the mounting bills. It therefore, becomes hard for them to compensate their clients ending up losing customer trust. They become insolvent and unable to meet their obligations to retirees down the road (Monga, 2). Decline in interest rates increases the present value of the deferred pensions. This increases corporate pension deficit since the monetary value of money decreases with time. This is clearly confirmed by Millan who asserts that the largest pensions in U.S have accrued up to $252 billion funding deficiency, which has shot up by $66 billion within a period of one year. Furthermore, Pension Benefit Guaranty Corporation encounters significant financial challenges. It is funded by premiums paid by pension plans that depend on how many beneficiaries are in a plan. However, those premiums are not enough to cover the costs. When the trust funds are finished, the most likely solution will be a transfer from general revenues, meaning that taxpayers will incur the bill (Monga, 2). Financial management and accountancy for a company is fundamental. With the implementation of the policy, corporations are compelled to channel their cash to activities they had not planned for. For instance, International Paper Company had set aside $ 1 billion to fund its $12.5 billion plan. With this policy, the money had to be put to other investments and projects not

Friday, September 27, 2019

Accessing bank data crime through the use of various information Dissertation

Accessing bank data crime through the use of various information technology in Saudi law - Dissertation Example However, the same has also led to a simultaneous rise in data crimes, and identity thefts have increased manifold. The ‘playing field’ for criminals has also widened, opening up newer avenues for committing virtual crimes; thus replacing unpleasant physical encounters with cyber crimes (Yusuf 2003). For instance, prior to the computerization of banks, most of the bank frauds or thefts involved armed robberies and breaking into banks causing physical injury to people and considerable damage to property. Today, the criminals use internet to break into customers’ accounts and steal their identities for withdrawing cash, thus only causing monetary damage. The tools available at the disposal of such criminals have also risen considerably with the advent of information technology, where frauds and thefts can easily be committed from the comforts of one’s own home (Forder, Quirk, 2001; Kono et al, 2002). The fact that computers and internet have made life easier f or customers in the banking sector, with services enabled through technology such as ATMs, internet banking, and bank by phone services, cannot be denied. However, at the same time, the complexities of bank-related crimes have also increased substantially and simultaneously. It has posed newer challenges for law enforcement agencies to monitor and control such crimes, making it practically mandatory for the law makers to enact new cyber laws; and their officers to gain and be proficient in computer science / forensics. As humans grow more and more dependent on technology, it is highly likely that computer related crimes would increase simultaneously (Lee, Lee, & Kim, 2007). Hence, the appropriate enactment and application of laws and effective use of technology are the only tools to combat and address such crimes with utmost efficiency. Furthermore, it is also equally important, rather imperative, for customers to understand and be aware of such crimes so as to secure their bank acc ounts from such fraudulent practices (Sathe, 1999; Salvatore, 2006; Jaffer, 2005; Laforet 2008; Dar and Presley 2003). This paper seeks to discuss, analyze and recommend ways to combat the challenges posed by technology enabled crimes within the banking sector, and use the same as an effective means of securing and preventing bank data thefts. Meaning and Definitions of key terms used: Data: According to Article 1 (3) of the Anti Cyber Crime Law, the term ‘data’ refers to â€Å"Information, commands, messages, voices, or images which are prepared or have been prepared for use in computers. This includes data which can be saved, processed, transmitted, or constructed by computers, such as numbers, letters, codes, etc.† Thus with reference to banks and for the purpose of this study, data thefts refers to the theft of all or any of the above mentioned data by use of information technology. Significance: This study would help in identifying the various ways in which data thefts occur in banks and raise awareness on the issue. Furthermore, it is intended to highlight the many ways in which technology can be used to counter such crimes, and address them through effective application of technology (Zheng and Ni, 2006). This study would also include various recommendations to reduce such thefts through network security; ensure greater protection of customers’ data by using tools which would prevent the cyber criminals from hacking and other similar ID related frauds. Thus, help the banks in improving its productivity as well as profitability by offering secure transactions. Scope of study: This study aims to highlight the

Thursday, September 26, 2019

Throughout This semester you will work in a small group(maximum four Essay

Throughout This semester you will work in a small group(maximum four persons)to analyse the strategic activates and decisions of - Essay Example The importance of location when expanding internationally is further verified through the study of Luo (2000). According to the above researcher, the expansion of each firm internationally is likely to be influenced by three factors: ‘ownership advantages of a firm, location advantages of a market, and advantages related to the internal processes of a firm’ (Luo 2000, p.103-104). It is made clear that choosing the appropriate location can affect the internationalization efforts of a firm, depending on the existence of increased or decreased location advantages in regard to the country chosen. According to Neelankavil (2007) choosing the appropriate country for entry is quite important due to the following reason: the selection of an inappropriate country for entry ‘can lead to severe damages on a firm’s performance while the time period required for recovering from such damages can be quite long’ (Neelankavil 2007, p.82). ... This means that the location chosen should secure the achievement of the above target, even in the long term (Ebner 2011). China meets the above term; the country’s population is quite high and the demand of products of such type, i.e. of products related to the nutrition of babies, is quite high, as also analyzed below. 3.2.2 Geographic distance When reviewing the appropriateness of a country as a target market emphasis should be also given to the distance between the home market and the target market (Tallman 2007). Indeed, ‘geographic distance’ (Tallman 2007, p.295) is often regarded as a factor that can highly influence the success of a product in a new market (Tallman 2007). Developing strategic alliances locally can be an excellent method for limiting the risks related to such initiatives (Tallman 2007, p.295). 3.2.3 Local demand for similar products The level of demand of products of similar characteristics is critical for choosing the location of a firmâ⠂¬â„¢s international expansion. In the case under examination the choice of China as a target market for Aptamil Power milk can be characterized as fully justified. In terms of its economy China ranks among the most powerful countries worldwide. In a report published by Economist (2013) emphasis is given to the power of the Chinese economy but also to the threats that the particular economy has to face since it is mainly ‘consumer – led’ (The Economist 2013). For Aptamil Power milk the Chinese market seems to be an excellent destination due to the following two reasons: a) the demand for products of the particular type is quite high in China (BBC News 2013), b) a recent scandal related to the quality of such

Wednesday, September 25, 2019

Business Ethics Case Study, Accounting Essay Example | Topics and Well Written Essays - 1000 words

Business Ethics Case Study, Accounting - Essay Example The general manager identified the current hazardous waste disposal produce as an area in which the company could save money. Mr. Hendricks identified equipment that would give the company the capacity to recycle the solvents. He consulted two industry experts to estimate the cost savings the company would obtain by acquiring the equipment. The experts disagreed on the amount of savings to the company. The lower estimate of cost savings would increase the net income of the company, but the decrease its return on investment due to the high acquisition cost. The greater cost saving estimate increased both the net income and return on investment of Tie Chemicals. Mr. Hendricks is responsible for presenting the proposal to the general manager for approval. He must follow the generally accepted accounting principles (GAAP) concerning this area of accounting. A key GAAP concerning estimates is the principle of conservatism. This principles states that accountants are required in their work to make estimates and evaluation, deliver opinions, and selecting appropriate procedures. When they are realizing this type of work they must do without neither overstating nor understating the affairs of the business or the results of operation. â€Å"If a situation arises in which there are two acceptable alternatives for reporting an item, conservatism directs an accountant to choose the alternative that will result in less net income or less asset amount† (AccountingCoach). The cost accountant is concerned with all the stakeholders involved. He wants to do what is right for the environment, thus approval of the project would help the environment. The stockholders and the board of directors want to receive the maximum profits and return on investment. There is a direct relationship between the manager’s year end bonuses and the net income of the company. There is decision to be made

Tuesday, September 24, 2019

Discussion Assignment Example | Topics and Well Written Essays - 500 words - 15

Discussion - Assignment Example Their recreational activities are also hindered. She says that she had to squeeze her work time, which served as her recreation to be with the kids at home, as her husband could not manage the kids alone. â€Å"...so I asked if I could just come to the store during the week...† (Ladies Home Journal, pg 2). Another challenge that women experienced was when the children fell ill. They felt they would be blamed for the illnesses. â€Å"...so I had exposed fifteen children to measles, and I was not the most unpopular mother in the neighbourhood...† (Pg 3) On the other hand, the richer women boasted of easier work handling of the house chores as they were introduced to machines like the hoover and the â€Å"full kitchen† accessories (Primary source pictorial, page 2 and page 5).In general, women found themselves caught between house chores and their leisure, which they often chose to fore go. In as much as the parents and social scientists of the day experienced anxiety over the emergence of a separate teenage culture, the business community took this to their advantage and produced more goods that would fit in the teenagers lifestyles. The increasing â€Å"teen market† was directly proportional to production and sales by the companies (The Teenage Consumer, Life 1959. Pg 2). Teenagers no longer fancied bikes and dresses; instead they surrounded themselves with millions of photographs, television sets and cameras, much to the disbelief of the parents who thought such as luxuries at their time (The teenage consumer, Life Magazine. Pg 1). As illustrated in "Life Magazine", (August 31st, 1959, Pg 1), previously the businessmen mainly ignored the teenage market. However, they later began to pump more resources in line with the teenage demand. A case example of a 17-year-old Suzzie is given; a route that apparently teenagers would

Monday, September 23, 2019

Banking law Essay Example | Topics and Well Written Essays - 2000 words

Banking law - Essay Example Thus Alice clearly intended to rely on Beatrice’s expertise as a financial advisor. In a typical case, where a fiduciary relationship is created such as the one between Alice and Beatrice, the fiduciary’s (Beatrice) discretion to manage the funds is limited by contract.2 The terms of the contract are not revealed by the facts of the case for discussion. The only know term is stated in broad terms: to build an investment portfolio. Regardless, fiduciary duties are typically provided for in standard contract forms. These duties usually include the no conflict rule, a duty of loyalty, the rule against personal profits and confidentiality rules.3 Despite the fact that the fiduciary duties are typically detailed in the standard form of contract, the fiduciary remains bound by the principle fiduciary duty of good faith.4 Frase advises however, that financial institutions such as banks are not typically regarded as fiduciaries in the ordinary course of their duties. In such a case, the relationship between the banker and the client is regulated by contract, leaving the client limited to remedies for negligence or breach of contract.5 However, financial advisors like all other members of the banking and investment market can be held to a fiduciary duty which operates outside of the contract with the client. According to Frase, in this regard, the fiduciary duty is â€Å"fact-based†.6 In other words, whether or not Beatrice, as a financial advisor is a fiduciary will turn on the particular facts of the case. As Lord Upjohn stated, it is necessary to evaluate all of the â€Å"facts and circumstances† to ascertain whether or not the agent in question is a fiduciary.7 Lord Upjohn went on to state that: The relationship must then be examined to see what duties are thereby imposed on the agent to see what is the scope and ambit of the duties.8 Lord Wilberforce also stated that the exact nature of the fiduciary’s duties â€Å"must be moulde d according to the nature of the relationship†.9 Frase explains that where a bank provides the ordinary services of receiving deposits or extending loans, it would not typically have a fiduciary relationship with its clients. However, the moment the bank goes beyond those contracted services, a fiduciary relationship will most often arise. For example in the event the bank or one of its agents, uses confidential information for its own use, a fiduciary duty arises.10 A fiduciary duty will also arise where the bank has a conflict of interest.11 It can be argued that Beatrice made personal use of confidential information connected to Alice’s account. Beatrice knew the details of Alice’s account and while she did not pass their information on to others, she used that information to access Alice’s account. Moreover, there is no doubt that a conflict of interest arose since Beatrice was concerned about her own financial difficulties and desires and put those ah ead of her client’s interest: to build an investment portfolio. The definition of a fiduciary as provided by Asquith LJ clearly captures the essence of Beatrice’s relationship with Alice. As Asquith LJ stated, a fiduciary duty

Sunday, September 22, 2019

The project life cycle Assignment Example | Topics and Well Written Essays - 1500 words

The project life cycle - Assignment Example These phases form essential elements for understanding a project’s life cycle. Each phase includes a combination of similar activities. Phases are sequential where one has to complete before the next one begins and some activities into the early phase of a project will continue until project completion Project life cycle is of great interest because it is a current issue applied in businesses to achieve their goals and objectives especially achieving growth by launching new products/services. Companies that desire to compete in international markets understand the importance of increasing project life cycle management invention and quality of their products/services (Burke, 2013). Project management is an emergent field that gives companies leverage to create new products and gain a competitive advantage. On a personal level, I am interested in this topic because it offers an exciting career path and a way to use my creativity to solve organizational problems. Academic curiosity also influenced my interest because I like researching on new areas of study to increase my knowledge. The research conducted for this paper shows similarities with project life cycle key concepts learnt in in the module. For example, the definition of key concepts such as phases and project life cycle processes are similar. Issues discussed in the research articles used to develop this paper were very similar to those discussed in the module. As I did my research, I felt like I was revising the concepts that I learn t in class. For example, all articles explain the four phases of project life cycle precisely as they were explained in the module learning materials. According to Burke (2013), the importance of project management life cycle is to create seamless flow of work in ensuring the success of a firm (Burke, 2013). Another importance is that the process eliminates delays and wastage of resources. It also facilitates quality

Saturday, September 21, 2019

American Political System and Philosophy Essay Example for Free

American Political System and Philosophy Essay The United States of America would have been completely different had the Founding Fathers been influenced by a different philosophical stream. Had democracy not been the cornerstone of the nation, Americans would not be enjoying the rights they have today. Democracy, in its literal meaning, suggests that the power of the state rests on its constituents and that, therefore, the fate of the country solely depends on its people. Without a democratic system, there will be no elections and no representations in the political arena. Since elections provide the means for the people to constantly shape the course of the nation’s institutions through elected officials, the lack thereof deprives Americans of their right to steer their country towards the direction which they see best fits their needs. For the most part, the Founding Founders perfectly embodied the noble principle of democracy in three simple words—â€Å"We the People†. If the political philosophy of Thomas Hobbes became the foundation of America, Americans will be forced to surrender their rights to a single authority. In effect, Americans will be left powerless as the â€Å"Leviathan† would have now held and wielded the aggregate of all their rights. The limitation of the political philosophy of Hobbes is clear—it does not recognize a large number of the rights of the people, more so their inalienable rights. Without recognizing the rights of the people, society becomes either lifeless or mechanical as individuals are forced to follow whatever the sitting authority dictates. In the society of Hobbes, Americans have no right to tell the ruler what to do. In some cases, modern Americans are unable to convince their local officials to do as they are told by their constituents. Rather, some local officials play deaf and mute to the calls of their constituents to make certain actions that will favor the larger body politic instead of a few chosen elites. If the political philosophy of John Stuart Mill became the foundation of America, the political system would have been chosen depending on the greatest good for the greatest number. In short, the political system will essentially be a Utilitarian system. In such a system, certain harms towards some Americans are permissible so long as the majority of the population is able to gain the best benefit. It then becomes clear that human rights violations are permissible if such violations would realize the best interest of the people. For example, the murder of thieves vigilante groups commit becomes acceptable because it reduces the possible sources of threats to life and property to most Americans. In the long run, the rule of law becomes parallel to the rule of the majority. Minorities who stand in opposition to the principles and ideals of the majority become powerless and are reduced to â€Å"toothless† citizens of the nation unable to change the social situation. Oftentimes, modern American culture reflects the Utilitarian perspective. One compelling example is the time when African-Americans were racially discriminated. Their discrimination was left unattended to by the federal government at that time primarily because most of the American population such as the â€Å"conservatives† benefitted from the oppression—benefit as in the context of their perception. I think the political philosophy of John Locke best reflects the formation of America as a nation. Locke primarily espouses the idea that men in the State of Nature would come together and transfer the power to punish transgressors to the government. Although the will of the majority requires all people to follow that will, the government plays the role of judge in times when offenses towards the people occur. The society formed from convention of people comes with certain laws that guide the actions of all people and serve as an adjudicating force with the aid of judges. Today, much of Locke’s political philosophy can be observed in America. The country has its own set of laws that guide the conducts of its citizens. Although the will of the majority is observed especially during elections, it does not necessarily deprive the minority of their rights and privileges in the society. As a matter of fact, American laws, in principle, do not discriminate between those who belong to the majority and those who are from the minority. All people are equal before the law.

Friday, September 20, 2019

The Starbucks Entrance Into Vietnam Marketing Essay

The Starbucks Entrance Into Vietnam Marketing Essay Starbucks Coffee Company Starbucks began in 1971 as a roaster and retailer of whole bean and ground coffee, tea and spices. Back then, the company was a single store in Seattles historic Pike Place Market. From just a narrow storefront, Starbucks offered some of the worlds finest fresh-roasted whole bean coffees. (Starbucks Coffee Company) Starbucks is named after the first mate in Herman Melvilles Moby Dick. The name evoked the romance of the high seas and the seafaring tradition of the early coffee traders. The logo is also inspired by the sea, featuring a twinà ¢Ã¢â€š ¬Ã‚ tailed siren from Greek mythology. (Starbucks Coffee Company) In 1981, Starbucks chairman, president and chief executive officer, Howard Schultz, was drawn into Starbucks from his first cup of Sumatra, and joined Starbucks a year later. (Starbucks Coffee Company) In 1983, Howard travelled to Italy and became fascinated by Italian coffee bars and the romance of the coffee experience. He had a vision to bring the Italian coffeehouse tradition back to the United States where coffeehouse is made a place for conversation and a sense of community and to be a third place between work and home. He left Starbucks for a short while to start his own Il Giornale coffeehouses and returned in August 1987 to purchase Starbucks with the help of local investors. (Starbucks Coffee Company) Today, Starbucks connect with millions of customers every day with exceptional products and nearly 18,000 retail stores in 60 countries. (Starbucks Coffee Company) Starbucks mission is to inspire and nurture the human spirit one person, one cup and one neighborhood at a time. (Starbucks Coffee Company) Starbucks have always believed in serving the best coffee possible and it is their goal for all of their coffee to be grown under the highest standards of quality, using ethical sourcing practices. STARBUCKS Entrance into Vietnam (Starbucks opens first store in coffee-loving Vietnam) Starbucks opened its first cafe in Vietnam in Ho Chi Minh City as part of its strategy to expand across Asia, and plans to add more shops throughout the country. The grand opening of the HCM City store marked Vietnam as Starbucks 12th market in the Asia Pacific, and adding up to its chain of some 3,400 stores in the area. John Culver, president of Starbucks Coffee China and Asia Pacific, said during the ribbon cutting ceremony that Vietnam is one of the most dynamic and interesting market in Asia, and that they are proud to open a Starbucks store in the country. Coffee Concepts (Vietnam) Ltd., a Hong Kong Maxims Group subsidiary, will operate Starbucks Ho Chi Minh City store in Vietnam, and its first store will be in the citys business district. Starbucks will be seeking to compete with local rivals in a country known for its strong cafe culture. Vietnam is the worlds second-largest coffee producer and it has dozens of local chains as well as small coffee shops on nearly every street corner which present a major challenge for Starbucks to break into the crowded market. According to research, although many people queued up in southern Ho Chi Minh City for the opening, but the US giants coffee may not be to everybodys taste. Some speculated about how the Starbucks will compete with Trung Nguyen Coffee and Highlands Coffee, a homegrown brand that credits Starbucks as an inspiration. One Vietnamese, Nguyen Tien Tam, 35 had been quoted as preferring Vietnamese coffee, which is stronger than Starbucks and that as a Vietnamese, he only love local coffee. Compared with other Asian markets which Starbucks has recently entered, the Seattle-based company faces a unique scenario in Vietnam, where French-inspired coffee culture rules supreme, two homegrown chains have established presences and family-run sidewalk cafes are as many as noodle shops. In HANOI, Vietnam, Nghiem Ngoc Thuy has been providing coffees to thirsty Vietnamese for 20 years in her colonial-style villa with peeling shutters, and she and her customers arent too worried that Starbucks will alter their time-tested coffee traditions. As quoted by Thuy, her family-run cafe in Hanoi offers prices that are affordable for average Vietnamese. Thuy further added that expensive coffee is just for the children of government officials, or people who have lots of money. A regular customer, an electronics salesman Do Thanh Tung, said he is eager to see if Starbucks coffee really is different from the Vietnamese blends he has been drinking since he was 10 years old. Tung, now 30, said Vietnamese young people will welcome Starbucks, once they get used to it. But he added that he doesnt expect to become a regular Starbucks patron because he drinks five or six cups of coffee a day, thus regular visits to Starbucks would be too expensive for him. Dang Le Nguyen Vu, whose Trung Nguyen Group owns 55 cafes in Vietnam, said he welcomes Starbucks and doesnt view the American newcomer as a threat. Vu even visualized Starbucks opening up to a hundred cafes in Vietnam in the next 10 years, but it remains questionable whether people in a country with such a low GDP per capita, and a different taste in coffee, would really accept Starbucks. Unlike China, where tea is the caffeinated drink of choice, Vietnam inherited a coffee culture from French colonizers in the 19th century. Vietnam is also the worlds second-largest exporter of coffee behind Brazil. Starbucks already operates more than 3,300 stores across 11 countries in the Asia-Pacific region, and its entry into Vietnam marks the latest round in a campaign to attract Asias emerging middle classes despite a stagnating U.S. economy. Jinlong Wang, president of Starbucks Asia-Pacific, said the company plans to expand across Vietnam in a way that celebrates the countrys coffee culture and heritage. He had commented on an email to The Associated Press that Starbucks is looking forward to growing with Vietnams already vibrant coffee industry and making a positive impact in the communities where they operate. Vietnam has a population of about 90 million and three out of five Vietnamese are under the age of 35. Architect Tran Cao Tho,a 32-year-old architect and his friends sipped their coffees from low, wooden stools on the sidewalk as motorbikes whizzed by and street singers dropped in. Starbucks will seek to profit from surging consumer demand. Tho and his friends are part of the sizeable under-35 generation that Starbucks, the Seattle-based company, will seek to convince and switch from stronger and cheaper coffee at their neighborhood cafà © to Starbucks coffee. Tho whose morning routine includes a cup of drip coffee at Hanois Cafe Hanh said that he like his coffee black, dark and strong and that he would go to Starbucks once in a while for the ambience, but not for the coffee as the flavor is too light. According to Anthony Emms, managing partner at Stanton Emms Strategy Consultants in Singapore, which advises international food and beverage companies on Asian markets, he commented that Vietnams economy has slowed recently in part because of a problematic banking sector, but Starbucks upmarket brand will appeal to the growing Vietnamese middle class, and that he doesnt believe there is a massive barrier to Starbucks in Vietnam and further added that Starbucks is not really a coffee but is a food-service concept. He further added that more than 60 per cent of Vietnams population was born after the Vietnam War ended in 1975, and there is a strong demand among youth in Hanoi and Ho Chi Minh City for branded clothing and accessories, regardless that the labels often are fakes, and average annual income is only about $1,500. Furthermore, other international food chains have opened stores in Vietnam in recent years, including the Australian coffee chain Gloria Jeans Coffees International, the California-based Coffee Bean Tea Leaf, and the American fast-food chains KFC and Burger King. And Nestle instant coffee which is engineered to suit the Vietnamese palette is sold widely in Vietnamese supermarkets. However, Emms said that Starbucks would risk alienating some of its potential clients if it didnt include Vietnamese drip coffee on its menus here. This would be to cater to and target at not only the younger generation but also the older and senior generation. What differentiates Starbucks from other coffee chains? (Starbucks Coffee Company) Starbucks have always believed in the importance of building a great, enduring company that strikes a balance between profitability and a social conscience. Starbucks take a holistic approach to ethically sourcing the highest quality coffee. This includes responsible purchasing practices, supporting farmer loans and forest conservation programs. They believe that by buying coffee this way, it helps foster a better future for farmers and a more stable climate for the planet. It also helps create a longà ¢Ã¢â€š ¬Ã‚ term supply of the highà ¢Ã¢â€š ¬Ã‚ quality beans which they have been carefully blending, roasting and packing fresh for more than 40 years. They share their customers commitment to the environment. And they believe in the importance of caring for the planet and encouraging others to do the same. It is their goal that 100% of their cups will be reusable or recyclable by 2015. They will also work to significantly reduce their environmental footprint through energy and water conservation, recycling and green construction. They also believe in fostering thriving communities, from the neighborhoods where their stores are located to the ones where their coffee is grown. To bring people together, inspire change and make a difference in peoples lives are all part of being a good neighbor. They also hope to contribute one million volunteer hours each year to their communities by 2015. Since the beginning, Starbucks has been a different kind of company. One which not only celebrate coffee and the rich tradition, but would also bring a feeling of connection. It is one that is dedicated to inspiring and nurturing the human spirit and committed to serving the finest coffee, creating an exceptional customer experience, and being a great place to work. Starbucks is grateful to their partners (employees) for making Starbucks the company that they are. And they are honored to be acknowledged for their efforts which earned Starbucks its awards and recognition. Today, with more than 17,400 stores in 60 countries, Starbucks is the premier roaster and retailer of specialty coffee in the world. And with every cup, they strive to bring both their heritage and an exceptional experience to life. 4Ps (old) 1P (new) OF STARBUCKS MARKETING STRATEGY IN VIETNAM (Starbucks opens first store in coffee-loving Vietnam) Price Starbucks will price its products in a premium position that is competitive. According to Sara Senatore, a New York-based analyst at Sanford C. Bernstein Co, prices may still be less than the U.S. because of lower income and operating costs in Vietnam. Place Their stores are a neighborhood gathering place for meeting friends and family. Their customers enjoy quality service, an inviting atmosphere and an exceptional cup of coffee. Starbucks is also monitoring Vietnams rising coffee demand. Its first store in the country is located in one of Ho Chi Minh Citys busiest roundabouts and is near to a new Burger King restaurant and Ben Thanh Market which is the center of the citys tourist trade. People (one of the new 4Ps) Their coffee buyers travel personally to coffee farms in Latin America, Africa and Asia to select the highest quality beans. And their master roasters bring out the balance and rich flavor of the beans through the signature Starbucks Roast. Starbucks offers the finest coffees in the world, grown, prepared and served by the finest people. Their employees, whom they call partners, are at the heart of the Starbucks Experience. They believe in treating their partners with respect and dignity. They are proud to offer two landmark programs for their partners: comprehensive health coverage for eligible fullà ¢Ã¢â€š ¬Ã‚  and partà ¢Ã¢â€š ¬Ã‚ time partners and equity in the company through Bean Stock. Product Starbucks offers an extensive wide range of exceptional products that customers enjoy in their stores, at home, and on the go. There are more than 30 blends and singleà ¢Ã¢â€š ¬Ã‚ origin premium coffees and Handcrafted Beverages which include freshà ¢Ã¢â€š ¬Ã‚ brewed coffee, hot and iced espresso beverages, Frappuccino ® coffee and nonà ¢Ã¢â€š ¬Ã‚ coffee blended beverages, smoothies and Tazo ® teas. Their merchandises include coffee and teaà ¢Ã¢â€š ¬Ã‚ brewing equipment, mugs and accessories, packaged goods, music, books and gifts. They also offer fresh food like baked pastries, sandwiches, salads, oatmeal, yogurt parfaits and fruit cups. Other Consumer Products Coffee and Tea include Whole bean and ground coffee (Starbucks and Seattles Best Coffee brands), Starbucks VIA ® Ready Brew, Starbucks ® Kà ¢Ã¢â€š ¬Ã‚ Cup ® portion packs, Tazo ® tea filterbags and tea latte concentrates. Starbucks also offers Readyà ¢Ã¢â€š ¬Ã‚ toà ¢Ã¢â€š ¬Ã‚ Drink (RTD) beverages wh ich include Starbucks ® bottled Frappuccino ® coffee drinks, Starbucks Discoveries ® chilled cup coffees, Starbucks Doubleshot ® espresso drinks, Starbucks Doubleshot ® Energy+Coffee drinks;Seattles Best Coffee ® Iced Lattes, Starbucks Refreshersà ¢Ã¢â‚¬Å¾Ã‚ ¢ beverages, Tazo ® bottled iced and juiced teas. Starbucks ® Ice Cream is also available in Superà ¢Ã¢â€š ¬Ã‚ premium coffee and coffeeà ¢Ã¢â€š ¬Ã‚ free flavors. Brand Portfolio Starbucks Coffee, Seattles Best Coffee, Tazo Tea, Evolution Fresh, La Boulange and Torrefazione Italia Coffee. Promotion Starbucks card members enjoy Starbucks Rewards which include complimentary handcrafted beverage of customers choice, brewed coffee and/or whole bean coffee. Members also enjoy complimentary slice of cake on birthday month. There is also a wide range of merchandize and product that is available which include bags, cups and mugs. swot Analysis on starbucks entrance into vietnam Strengths (Starbucks Coffee Company) Starbucks purchases and roasts high-quality whole bean coffees. Their coffeehouses have become a inspiration for coffee lovers everywhere. They insist on Starbucks because they know they can count on its genuine service, an inviting atmosphere and a superb cup of expertly roasted and richly brewed coffee every time. Starbucks is more than Coffee, they are passionate sources of coffee and everything else that goes with a rewarding coffeehouse experience. They also offer a selection of premium Tazo ® teas, fine pastries and other palatable treats to please the taste buds. And the music you hear in store is chosen for its artistry and appeal. People come to Starbucks to work, chat or meet up. Theyre a neighborhood gathering place which has become a part of their daily routine. It has a global recognition and good reputation for fine products and services. Starbucks has nearly 18,000 retail stores in 60 countries. The company values its workforce and treats its employers as partners. The company has strong ethical values and ethical mission statement. Starbucks has some equally impressive statistics with 41 years of experience and 3,300 stores in 12 countries in the China and Asia-Pacific region. They also have an ongoing relationship with Vietnamese coffee growers. According to the company, Starbucks already purchases a notable amount of high-quality arabica coffee from Vietnam and are working to buy more. Weakness (Starbucks enters entrenched Vietnam coffee market | SeacoastOnline.com) Starbucks will have to battle entrenched tastes, local brands, international rivals and the thousands of neighborhood coffee shops that dot Vietnams streets. Local chains such as Trung Nguyen Coffee and Highlands Coffee have more experience catering to the Vietnamese love of strong coffee. Starbucks coffee flavor is too light. Starbucks coffee may be too expensive for local consumers who need their coffees regularly each day. Opportunities (Starbucks enters entrenched Vietnam coffee market | SeacoastOnline.com) There is a strong demand among youth in Hanoi and Ho Chi Minh City for branded goods and services. Starbucks looks forward at growing with Vietnams already vibrant coffee industry and making a positive impact in the communities where they operate. Has potential to consider co-branding with other food and drink manufacturers and also brand franchising to manufacturers of other goods and services. (Starbucks opens chain of raw vegan juice bars) (Starbucks opens new blend of juice bars) (Starbucks to open first Evolution Fresh juice store USATODAY.com) New markets for coffee and healthy beverages are beginning to emerge and that can be retailed in their cafes. (NaturalNews) Starbucks, the coffee shop that is renowned for its seemingly limitless coffee varieties, is opening a new chain of juice bars in response to the growing health trend towards unprocessed and whole foods. In late 2011, the coffee giant also brought out Evolution Fresh, a juice company. Health foods now represent a $50 billion industry, and Starbucks has been very open about their intention to expand into the market and establish themselves as a major player. The juice bars will offer fruit and vegetable options which can be blended according to customer preference, or in sampled and true menu options to produce natural fruit juices that are high in dietary fiber, vitamins A, C, and E, and antioxidants. Thicker smoothies can be supplemented with protein ingredients such as juiced wheat grass and nut butter, to help provide customers with a more nutritionally balanced meal. Their healthy foods and snack options which include a wide menu to support vegetarian and vegan lifestyles will also be available. Starbucks think the market demand is high enough to justify its own set of chains, not just an extra few fruit options on the menu at their coffee shops. While the market is smaller than that for coffee, Starbucks research on consumer spending trends show the increasing concern with health. Despite this being a more risky investment than those to which Starbucks shareholders are familiar with, the dollar market shares of the company are steadily rising, showing wide support for this move. Over the past few years, the fresh fruit smoothie industry has bloomed into a billion dollar industry. Customer demand can be seen in the number of people purchasing bottled mixed vegetable and fruit drinks, seeking dietary reparation or preventative health measures against a wide array of illnesses. Growing numbers of people are turning to juicing for detox solutions. According to research, there is certainly more than enough demand to support this major industry. One of the customers, Angelica R. from Salt Lake City said she cant wait till Evolution is worldwide so she could go back again. Starbucks purchase of Evolution Fresh for US$30 million last year was in line with its strategy to sell a broader range of products through its own cafes, grocery stores and other retail outlets. Threats (Starbucks enters entrenched Vietnam coffee market | SeacoastOnline.com) Vietnam is the worlds second-largest coffee producer and it has dozens of local chains as well as small coffee shops on nearly every street corner which present a major challenge for Starbucks. Starbucks will have to compete with Trung Nguyen Coffee and Highlands Coffee, a homegrown brand as well as other coffee chains that have opened stores in Vietnam in recent years and who have more experience catering to the Vietnamese love of strong coffee, including the Australian coffee chain Gloria Jeans Coffees International, the California-based Coffee Bean Tea Leaf, and Nestle instant coffee which is engineered to suit the Vietnamese palette is sold widely in Vietnamese supermarkets. Another threat is Trung Nguyens plan to enter the U.S. market which follows the companys rise to become the biggest roaster and packaged-coffee retailer in a country with a brewing tradition dating from 19th century plantations by French colonists. The chains 60 shops across the country serve Vietnamese-style individually brewed cups, along with varieties including Italian espresso and Turkish-style coffees, a mix which Vu expects to sell well in the United States as well. Vus focus on specialty beans and roasting includes a variety called Legendee created to mimic the flavor of coffee brewed from beans that are recovered from the feces of civets, a weasel-like rodent. The civet coffee is considered a delicacy. According to the companys website, the coffee roaster discovered enzymes that mimic civet digestion and developed a process to give the coffee the same magical flavor. Vu said he intends to build a coffee empire and a global brand within the next 10 years, rivaling Starbucks. He said that the company is also considering an initial public offering and the timing has yet to be decided. Vu won a medical degree before starting his roasting business. He developed Trung Nguyen from a shop he founded as a student into a coffee retailer with more than 3,000 employees. He plans to increase the number of cafes in Vietnam to 200 in the next two years. Porters 5 forces in reaction to the SWOT analysis Starbucks stability and expansion in Vietnam will be determined by external sources which include potential entrants which may also want to venture into the Vietnamese market, also by internal and external threats which include pre-existing local brands and industrial rivalries and by threats of substitutes whereby another type of beverage or service may replace Starbucks coffee and beverages. Other internal threats would include the effect of suppliers power and the buying power of the customer. (porters 5 forces Google Search) Sustainable Competitive Advantage Analysis (sustainable competitive advantage analysis | blekko) Competitive advantage is defined as the strategic advantage one business entity has over its rival entities within its competitive industry. Achieving competitive advantage strengthens and positions a business better within the business environment. In order to uphold a sustainable competitive advantage, Starbucks must achieve its value activities in a way difficult for competitors to replicate or imitate. A competitive advantage is maintained if the cumulative cost of performing the value activities is lower than competitors. A level of value must support the competitive advantage to the customer that is at least compatible to the competitors. Otherwise, a lower price will have to be charged and the net effect will be zero. A companys relative competitive advantage will depend on the type of structure the value chain of the company has versus the competitors and also the position of the cost drivers in each activity. OUTLOOK (Starbucks opens first store in coffee-loving Vietnam) (Starbucks has seen mixed reactions in AsiaLIFE HCMC) John Culver, president for China and Asia Pacific said that Starbucks plans on showing up in a way that doesnt currently exist in the market in terms of the premium products and the experience they offer. The chain will offer flavors that will be tailor-made to Vietnamese tastes along with its trademark drinks, while expanding aggressively into Hanoi and other cities. Starbucks however declined to elaborate on the number of outlets it plans to open in Vietnam. Ralf Matthaes, a regional managing director at market research and consultancy firm TNS said that Local consumers will be drawn by the Starbucks name and young people desire that modern, hip culture. He further added that Starbucks is famous and Vietnamese people want to be seen at popular places, which is very typical for Vietnamese. Vietnams coffee culture stretches back to the late-19th century after France colonized the country. According to the General Statistics Office, it exported 1.73 million metric tons of coffee in 2012, and is the worlds biggest exporter of bitter- tasting robusta. According to the International Coffee Organization, consumption of the drink in Vietnam jumped 65 percent between 2008 and 2011. Tran Doan Kim, a business management professor at National University said the coffee chain will attract young Vietnamese who like to be fashionable, live a Western lifestyle and enjoy brand names. According to the World Bank website, Vietnam had reached what the World Bank calls lower middle-income status in 2009, with per-capita income having increased more than 10-fold since the ruling Communist Party started market-oriented reforms in 1986. Gross national income per capita was $1,270 in 2011. Dang Le Nguyen Vu, founder and owner of Trung Nguyen, which operates about 60 cafes in the country, isnt threatened by his newest competitor. He said Starbucks is not worth worrying about as it doesnt sell coffee. The people who go into a Starbucks may want to show that they are modern and stylish and a coffee lover will go to them instead. Vu said Trung Nguyen, which exports coffee to about 60 countries, will expand to at least 200 retail outlets in two years. Highlands Coffee stores, with overhead music and Wi-Fi Internet, are located in prime retail and landmark locations in Vietnams largest cities. Culver said Starbucks will price its products in a premium position that is competitive. According to Sara Senatore, a New York-based analyst at Sanford C. Bernstein Co, prices may still be less than the U.S. because of lower income and operating costs. Senatore further added that Starbucks doesnt compete directly with the local coffee shops, just the same way that McDonalds or KFC doesnt compete directly with the local fast-food vendors. And there is a premium that people are willing to pay for a clean environment, for consistent products and good service. Thuan Pham, a commercial airline pilot and a Vietnamese-American who now lives in Ho Chi Minh City who goes patronizes Coffee Bean Tea Leaf in Hanoi expects to be a frequent Starbucks visitor and said he will be surprised if Starbucks doesnt succeed in Vietnam. Pham added that the cool factor is crucial and its important for young people to be seen at these places and is not about the coffee. A first time customer, Nguyen Ngoc Tram, 17 explained to Tuoitrenews that as this is the first time she tasted a US coffee brand name, she was very eager to buy her first Starbucks cup and was willing to queue for more than 30 minutes to be able to sip her Vietnamese Starbucks coffee. An hour after the official opening hour, the long line in front of the store still remained, as there were more people like Tram coming to become one of the first to taste Starbucks in Vietnam. Most of other customers are young, and those who have already experienced Starbucks in the US and other Asian countries. They said they came to see if there is any difference between Starbucks Vietnam and in other nations. One local coffee store owner, Nguyen Phi whose shop is located in the chaotic traffic in the roundabout just west of the New World Hotel and of Phis newest neighbour and competitor, Starbucks commented that they dont operate on the same battlefield and belong to two different businesses. Le Suan, one of Phis customers, agrees that while he now lives in the United States, he grew up in Vietnam and defaults to local coffee joints when he returns to his home country for a visit. He further explained that people in Vietnam drink their coffee very strong and Starbucks coffee is very light. Coffee is not just coffee but more a way of life in Vietnam. While its consumed as a morning pick-me-up in parts of the western world, its a social activity that takes place throughout the day here. Venue options, which range from mobile coffee carts to locally-owned cafes to big-but-still-local names like Trung Nguyen, are pretty much unlimited. The rest of the world has also caught on to the great flavour of the Vietnamese coffee bean and the country is now one of the top coffee exporters in the world. John Culver, president of Starbucks China and Asia Pacific, tells AsiaLIFE that Starbucks is deeply respectful of Vietnams long and distinctive local coffee culture and they know coffee is a national pride for many Vietnamese and as such, Starbucks look forward to contributing and growing Vietnams already vibrant coffee industry. The company also pledges to promote responsible business practices and production standards with coffee farming communities. While this is reassuring to some, others remain concerned, especially those whove come from areas where large coffee chains have pushed smaller operations out of business. One commenter even quipped that Starbucks is the new war face of America. So who is Starbucks targeted customer in Vietnam? Who are the patrons who would be willing to wait in long lines for that tall, grande or venti cup at a price substantially more than what they can get on the street? It would be tourists and guests of the New World Hotel and young Vietnamese, who are seeking to try this internationally-known brand and perhaps to impress others with it, who would also likely to be there as well. A customer, Nguyen Phuong said many in Vietnam know of Starbucks and want to be fashionable. She and her friend Nguyen Nga are already part of the Starbucks in-crowd thanks to jobs that often take them outside the country. On those trips, they are regular Starbucks customers who go not for a standard cup of coffee but for the specialty drinks. Phuong added that Starbucks has so many things like Cappuccino that other local coffee stores dont have. And both Phuong and Nga love the taste of Starbucks and accept the price. The key to all coffee vendors surviving in Ho Chi Minh City may come down to menu offerings. Joints like Starbucks and Coffee Bean and Tea Leaf succeed at higher-priced specialty drinks, while coffee carts focus on their classic offerings at extremely low prices. The face of the countrys coffee culture is changing but back at the busy roundabout, where Cach Mang Thang Tam, Nguyen Trai, and Ly Tu Trong streets meet, one of the local coffee store, Nguyen Phi has no intention of changing his business plan. Hell keep doing what he does best and his customers will keep coming as well. John Culver, president of the companys China and Asia Pacific region, said in a telephone interview that Starbucks will grow aggressively in Vietnam and there will be hundreds of stores for Starbucks though he didnt give a time frame for the expansion. Dang Le Nguyen Vu, founder and owner of Trung Nguyen said hes ready to compete against Starbucks with a plan hes developed over the past three years. His newest cafes in Vietnam are in fact reminiscent of Starbucks, with oversized armchairs, contemporary music and a menu offering coffee drinks, smoothies and snacks. Some stores even feature shelves lined with books that customers are encouraged to browse including books that inspire and encourage young Vietnamese patrons. Vu further added that Starbucks no longer has the personality it had when it first started and that its regime will soon end and will soon be replaced. Well, it has happened Starbucks has finally