Business Resources Assignment Example | Topics and Well Written Essays - 2750 words

Business Resources - Assignment Example1.2 Recommendation of Best Strategy for Expanding and Supplying the Four Target Markets62.1 Current stinting and Market Conditions in the Euro Zone62.2 Strategies to Manage Foreign Exchange Exposure83. Factors to Be Considered While Conducting Investment Appraisal for the Strategies11References14OverviewElecdyne Wales is a South Wales-based electronic goods producing high society that had been instituted as a spinoff from a Japanese electronics order and the Celtic University of Technology. The objective of Elecdyne Wales is to develop patentable electronic goods making utilization of leading edge telecommunications and multimedia technologies and market them in the European Union region. Elecdyne Wales wants to increase its extent of business as it wants to supply its goods in the United nation and Germany this year, and France and Italy in the following year. Thus, the company has to make certain strategic investment decisions and it has four different strategies to choose from. The premier(prenominal) option is to expand the existing production capacity at South Wales and reinforce its export function. The second option available is to form a strategic alliance with a European supplier or distributor. The third option is to displacement its production base to a location in the European Union region, while the fourth option is to shift production to Central and Eastern European Countries (CEEC). This paper appraises the strategic investment options available to Elecdyne Wales in context of the latest economic developments in the European region, and recommends the outgo strategy to cater the markets of UK, Germany, France and Italy. The papers also discusses the existing economic and market circumstance in the Euro zone and proposes both short-term as well as long-term strategies for the company to manage foreign exchange exposure. Additionally the paper also accentuates on the factors to be considered while ca rrying out the investment appraisal of the cultivation three options available to Elecdyne Wales. 1.1 Evaluation of the four Options in light of recent development in European Economies 1.11 Analysis of Investment Strategy 1 The first strategic option of the company is to expand its existing production capacity at South Wales and strengthen its export function. Implementation of this strategy would enable the company to have superior control over its goods manufacturing process and also save the company from economic exposure of an overseas region. Moreover the company would not have humanitarianal capital investments to set up a new unit and it would also not lose its technological knowledge and expertise to its foreign associates. Thus, the strategy of reinforcing its existing manufacturing facility would ensure that the company maintains its technological edge in addition to having more operational flexibility. Nevertheless, there are certain drawbacks of this strategy. Since the company is smell forward to export its products to the European markets, carrying out the production in South Wales would rule out the understanding of the European culture and market specifics, in addition to higher costs of manufacture and haulage. Thus, though the strategy gives certain short-term benefits such as no additional production set-up investments, minimal exposure to transmutation and economic exposure and manageable foreign exchange risks the strategy can be termed as defensive in the long run and it would keep the company away from cost competition (Gillespie et al. 2010). 1.12 Analysis of Investment Strategy 2 The second alternative available is to form a strategic alliance with a European supplier or distributor. If the company opts for this strategy it would gain from the existing network and the market knowledge of the