Autoliv Qb Proposed Joint Venture Case Study Solution

Business is presently one of the greatest food chains worldwide. It was founded by Henri Autoliv Qb Proposed Joint Venture in 1866, a German Pharmacist who initially introduced "FarineLactee"; a mix of flour and milk to feed infants and reduce death rate.
Business is now a multinational company. Unlike other international companies, it has senior executives from various countries and tries to make choices thinking about the entire world. Autoliv Qb Proposed Joint Venture currently has more than 500 factories around the world and a network spread across 86 nations.

Purpose

The function of Business Corporation is to boost the quality of life of individuals by playing its part and supplying healthy food. While making sure that the company is prospering in the long run, that's how it plays its part for a better and healthy future

Vision

Autoliv Qb Proposed Joint Venture's vision is to supply its clients with food that is healthy, high in quality and safe to eat. Business visualizes to establish a well-trained workforce which would help the business to grow
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Mission

Autoliv Qb Proposed Joint Venture's objective is that as presently, it is the leading company in the food market, it believes in 'Great Food, Good Life". Its objective is to supply its consumers with a variety of choices that are healthy and finest in taste. It is concentrated on supplying the very best food to its customers throughout the day and night.

Products.

Autoliv Qb Proposed Joint Venture has a broad variety of items that it provides to its consumers. In 2011, Business was listed as the most gainful company.

Goals and Objectives

• Bearing in mind the vision and objective of the corporation, the business has actually set its objectives and objectives. These goals and goals are noted below.
• One goal of the business is to reach zero garbage dump status. (Business, aboutus, 2017).
• Another objective of Autoliv Qb Proposed Joint Venture is to waste minimum food during production. Usually, the food produced is wasted even prior to it reaches the customers.
• Another thing that Business is dealing with is to improve its packaging in such a method that it would help it to lower the above-mentioned issues and would likewise guarantee the delivery of high quality of its items to its consumers.
• Meet international requirements of the environment.
• Build a relationship based on trust with its consumers, company partners, employees, and government.

Critical Issues

Just Recently, Business Business is focusing more towards the strategy of NHW and investing more of its earnings on the R&D innovation. The country is investing more on acquisitions and mergers to support its NHW method. The target of the company is not attained as the sales were anticipated to grow higher at the rate of 10% per year and the operating margins to increase by 20%, given in Exhibition H.

Situational Analysis.

Analysis of Current Strategy, Vision and Goals

The current Business technique is based upon the principle of Nutritious, Health and Health (NHW). This technique deals with the concept to bringing modification in the consumer preferences about food and making the food things healthier worrying about the health issues.
The vision of this technique is based upon the key technique i.e. 60/40+ which just indicates that the items will have a score of 60% on the basis of taste and 40% is based on its nutritional value. The items will be made with extra nutritional value in contrast to all other items in market gaining it a plus on its dietary content.
This strategy was adopted to bring more yummy plus healthy foods and beverages in market than ever. In competitors with other business, with an intent of retaining its trust over customers as Business Company has acquired more trusted by customers.

Quantitative Analysis.

R&D Spending as a portion of sales are decreasing with increasing actual quantity of spending shows that the sales are increasing at a greater rate than its R&D spending, and permit the business to more invest in R&D.
Net Revenue Margin is increasing while R&D as a portion of sales is declining. This indication also reveals a thumbs-up to the R&D spending, mergers and acquisitions.
Financial obligation ratio of the business is increasing due to its spending on mergers, acquisitions and R&D development rather than payment of debts. This increasing financial obligation ratio posture a threat of default of Business to its investors and might lead a decreasing share prices. In terms of increasing financial obligation ratio, the firm needs to not invest much on R&D and should pay its existing debts to decrease the danger for investors.
The increasing danger of financiers with increasing financial obligation ratio and decreasing share rates can be observed by huge decline of EPS of Autoliv Qb Proposed Joint Venture stocks.
The sales growth of business is likewise low as compare to its mergers and acquisitions due to slow understanding structure of customers. This slow development also prevent business to additional spend on its mergers and acquisitions.( Business, Business Financial Reports, 2006-2010).
Note: All the above analysis is done on the basis of estimations and Graphs given in the Displays D and E.

TWOS Analysis

2 analysis can be utilized to derive numerous methods based upon the SWOT Analysis offered above. A quick summary of TWOS Analysis is given in Display H.

Strategies to exploit Opportunities using Strengths

Business must introduce more ingenious products by large quantity of R&D Spending and mergers and acquisitions. It might increase the market share of Business and increase the profit margins for the business. It could also provide Business a long term competitive benefit over its rivals.
The global expansion of Business need to be focused on market recording of developing countries by growth, drawing in more customers through client's loyalty. As developing countries are more populous than industrialized countries, it could increase the consumer circle of Business.

Strategies to Overcome Weaknesses to Exploit Opportunities

Autoliv Qb Proposed Joint Venture ought to do careful acquisition and merger of companies, as it might affect the consumer's and society's perceptions about Business. It should obtain and merge with those companies which have a market track record of healthy and healthy companies. It would enhance the perceptions of customers about Business.
Business ought to not only invest its R&D on development, instead of it should likewise concentrate on the R&D costs over assessment of cost of numerous nutritious products. This would increase expense efficiency of its products, which will lead to increasing its sales, due to declining costs, and margins.

Strategies to use strengths to overcome threats

Business ought to transfer to not only establishing but also to industrialized nations. It ought to broadens its geographical expansion. This broad geographical growth towards establishing and developed nations would reduce the risk of possible losses in times of instability in different nations. It ought to broaden its circle to different countries like Unilever which operates in about 170 plus countries.

Strategies to overcome weaknesses to avoid threats

It ought to get and merge with those nations having a goodwill of being a healthy company in the market. It would also enable the business to use its potential resources effectively on its other operations rather than acquisitions of those companies slowing the NHW method development.

Segmentation Analysis

Demographic Segmentation

The group segmentation of Business is based on 4 factors; age, gender, earnings and profession. Business produces a number of products related to babies i.e. Cerelac, Nido, etc. and related to grownups i.e. confectionary items. Autoliv Qb Proposed Joint Venture items are rather budget friendly by almost all levels, however its significant targeted consumers, in terms of income level are middle and upper middle level customers.

Geographical Segmentation

Geographical division of Business is made up of its presence in nearly 86 nations. Its geographical segmentation is based upon 2 primary factors i.e. typical income level of the consumer along with the environment of the region. For instance, Singapore Business Company's segmentation is done on the basis of the weather condition of the region i.e. hot, warm or cold.

Psychographic Segmentation

Psychographic division of Business is based upon the character and lifestyle of the client. Business 3 in 1 Coffee target those clients whose life design is quite hectic and do not have much time.

Behavioral Segmentation

Autoliv Qb Proposed Joint Venture behavioral division is based upon the attitude understanding and awareness of the customer. Its extremely nutritious items target those customers who have a health mindful mindset towards their intakes.

Autoliv Qb Proposed Joint Venture Alternatives

In order to sustain the brand name in the market and keep the client undamaged with the brand, there are 2 options:
Option: 1
The Company needs to invest more on acquisitions than on the R&D.
Pros:
1. Acquisitions would increase overall properties of the company, increasing the wealth of the business. Spending on R&D would be sunk cost.
2. The company can resell the obtained units in the market, if it stops working to implement its method. Amount spend on the R&D might not be restored, and it will be thought about totally sunk cost, if it do not offer prospective outcomes.
3. Spending on R&D supply slow growth in sales, as it takes very long time to introduce an item. However, acquisitions offer quick outcomes, as it provide the company currently established product, which can be marketed soon after the acquisition.
Cons:
1. Acquisition of company's which do not fit with the business's values like Kraftz foods can lead the company to face mistaken belief of customers about Business core values of healthy and healthy products.
2 Big spending on acquisitions than R&D would send out a signal of company's ineffectiveness of developing ingenious products, and would lead to customer's frustration as well.
3. Large acquisitions than R&D would extend the line of product of the business by the items which are already present in the market, making company unable to present brand-new innovative items.
Option: 2.
The Business ought to invest more on its R&D rather than acquisitions.
Pros:
1. It would enable the company to produce more innovative items.
2. It would supply the business a strong competitive position in the market.
3. It would allow the company to increase its targeted clients by presenting those items which can be offered to a totally brand-new market section.
4. Ingenious products will provide long term advantages and high market share in long term.
Cons:
1. It would decrease the profit margins of the business.
2. In case of failure, the entire spending on R&D would be considered as sunk cost, and would impact the company at large. The threat is not when it comes to acquisitions.
3. It would not increase the wealth of business, which could provide a negative signal to the financiers, and could result I declining stock prices.
Alternative 3:
Continue its acquisitions and mergers with considerable costs on in R&D Program.
Pros:
1. It would enable the company to present new innovative items with less threat of converting the costs on R&D into sunk cost.
2. It would provide a favorable signal to the financiers, as the overall assets of the company would increase with its considerable R&D spending.
3. It would not affect the earnings margins of the business at a big rate as compare to alternative 2.
4. It would supply the business a strong long term market position in terms of the business's overall wealth along with in regards to innovative products.
Cons:
1. Threat of conversion of R&D spending into sunk expense, higher than alternative 1 lesser than alternative 2.
2. Danger of misconception about the acquisitions, higher than alternative 2 and lesser than alternative 1.
3. Intro of less variety of ingenious products than alternative 2 and high number of innovative items than alternative 1.

Autoliv Qb Proposed Joint Venture Conclusion

It has actually institutionalised its techniques and culture to align itself with the market changes and customer habits, which has actually eventually allowed it to sustain its market share. Business has actually developed substantial market share and brand identity in the city markets, it is suggested that the company must focus on the rural locations in terms of establishing brand loyalty, awareness, and equity, such can be done by creating a particular brand name allowance strategy through trade marketing strategies, that draw clear distinction between Autoliv Qb Proposed Joint Venture items and other rival products.

Autoliv Qb Proposed Joint Venture Exhibits