Kulicke And Soffa Industries Inc In China Transferring Knowledge A Case Study Solution

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Kulicke And Soffa Industries Inc In China Transferring Knowledge A Case Study Analysis

Kulicke And Soffa Industries Inc In China Transferring Knowledge A is presently among the greatest food chains worldwide. It was founded by Kelloggs in 1866, a German Pharmacist who first introduced "FarineLactee"; a mix of flour and milk to feed babies and reduce death rate. At the same time, the Page bros from Switzerland likewise found The Anglo-Swiss Condensed Milk Business. The two became rivals at first but later merged in 1905, leading to the birth of Kulicke And Soffa Industries Inc In China Transferring Knowledge A.
Business is now a multinational business. Unlike other international companies, it has senior executives from various countries and attempts to make decisions considering the entire world. Kulicke And Soffa Industries Inc In China Transferring Knowledge A currently has more than 500 factories around the world and a network spread throughout 86 nations.


The function of Kulicke And Soffa Industries Inc In China Transferring Knowledge A Corporation is to boost the quality of life of individuals by playing its part and offering healthy food. It wishes to help the world in shaping a healthy and much better future for it. It likewise wishes to motivate individuals to live a healthy life. While ensuring that the company is succeeding in the long run, that's how it plays its part for a better and healthy future


Kulicke And Soffa Industries Inc In China Transferring Knowledge A's vision is to supply its customers with food that is healthy, high in quality and safe to eat. It wants to be ingenious and at the same time comprehend the requirements and requirements of its customers. Its vision is to grow fast and offer items that would please the requirements of each age group. Kulicke And Soffa Industries Inc In China Transferring Knowledge A imagines to develop a trained workforce which would help the company to grow


Kulicke And Soffa Industries Inc In China Transferring Knowledge A's mission is that as presently, it is the leading company in the food industry, it thinks in 'Good Food, Good Life". Its mission is to provide its customers with a range of options that are healthy and best in taste. It is concentrated on providing the very best food to its consumers throughout the day and night.


Business has a large range of products that it uses to its customers. Its items consist of food for babies, cereals, dairy products, snacks, chocolates, food for animal and mineral water. It has around 4 hundred and fifty (450) factories all over the world and around 328,000 staff members. In 2011, Business was listed as the most rewarding company.

Goals and Objectives

• Keeping in mind the vision and objective of the corporation, the business has actually laid down its objectives and objectives. These goals and goals are listed below.
• One goal of the business is to reach no garbage dump status. It is working toward no waste, where no waste of the factory is landfilled. It encourages its workers to take the most out of the by-products. (Business, aboutus, 2017).
• Another objective of Kulicke And Soffa Industries Inc In China Transferring Knowledge A is to lose minimum food throughout production. Most often, the food produced is squandered even before it reaches the customers.
• Another thing that Business is dealing with is to enhance its packaging in such a way that it would help it to reduce the above-mentioned issues and would also ensure the shipment of high quality of its items to its customers.
• Meet worldwide requirements of the environment.
• Build a relationship based upon trust with its consumers, company partners, workers, and government.

Critical Issues

Recently, Business Business is focusing more towards the strategy of NHW and investing more of its profits on the R&D technology. The nation is investing more on acquisitions and mergers to support its NHW strategy. The target of the business is not achieved as the sales were anticipated to grow greater at the rate of 10% per year and the operating margins to increase by 20%, provided in Exhibit H.

Situational Analysis.

Analysis of Current Strategy, Vision and Goals

The present Business strategy is based on the idea of Nutritious, Health and Health (NHW). This technique handles the idea to bringing change in the consumer preferences about food and making the food stuff much healthier worrying about the health concerns.
The vision of this strategy is based upon the secret technique i.e. 60/40+ which simply indicates that the items will have a score of 60% on the basis of taste and 40% is based upon its dietary worth. The products will be produced with extra dietary worth in contrast to all other items in market gaining it a plus on its dietary material.
This strategy was embraced to bring more yummy plus healthy foods and drinks in market than ever. In competition with other business, with an intent of maintaining its trust over consumers as Business Company has actually gained more trusted by customers.

Quantitative Analysis.

R&D Costs as a percentage of sales are decreasing with increasing actual quantity of spending shows that the sales are increasing at a greater rate than its R&D costs, and permit the business to more invest in R&D.
Net Revenue Margin is increasing while R&D as a percentage of sales is declining. This sign likewise reveals a thumbs-up to the R&D costs, mergers and acquisitions.
Debt ratio of the company is increasing due to its spending on mergers, acquisitions and R&D advancement instead of payment of financial obligations. This increasing debt ratio present a danger of default of Business to its financiers and could lead a decreasing share rates. Therefore, in terms of increasing debt ratio, the company should not invest much on R&D and needs to pay its present debts to decrease the risk for investors.
The increasing threat of investors with increasing financial obligation ratio and decreasing share costs can be observed by huge decrease of EPS of Kulicke And Soffa Industries Inc In China Transferring Knowledge A stocks.
The sales growth of company is likewise low as compare to its mergers and acquisitions due to slow perception structure of customers. This slow growth likewise hinder company to further invest in 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 used to obtain different techniques based on the SWOT Analysis offered above. A quick summary of TWOS Analysis is given in Exhibit H.

Strategies to exploit Opportunities using Strengths

Business ought to present more innovative items by large quantity of R&D Costs and mergers and acquisitions. It could increase the marketplace share of Business and increase the profit margins for the business. It might likewise supply Business a long term competitive advantage over its competitors.
The international growth of Business need to be concentrated on market capturing of establishing countries by growth, attracting more consumers through customer's loyalty. As establishing countries are more populated than developed nations, it could increase the client circle of Business.

Strategies to Overcome Weaknesses to Exploit Opportunities

Swot AnalysisKulicke And Soffa Industries Inc In China Transferring Knowledge A ought to do careful acquisition and merger of companies, as it might impact the customer's and society's perceptions about Business. It must obtain and merge with those companies which have a market reputation of healthy and healthy companies. It would improve the understandings of consumers about Business.
Business needs to not just invest its R&D on development, rather than it needs to also focus on the R&D spending over assessment of expense of numerous nutritious items. This would increase expense performance of its items, which will lead to increasing its sales, due to declining prices, and margins.

Strategies to use strengths to overcome threats

Business needs to move to not just developing however also to industrialized countries. It ought to broadens its geographical expansion. This broad geographical expansion towards establishing and established countries would decrease the danger of potential losses in times of instability in various countries. It needs to widen its circle to numerous countries like Unilever which operates in about 170 plus nations.

Strategies to overcome weaknesses to avoid threats

It should acquire and combine with those countries having a goodwill of being a healthy business in the market. It would also enable the company to utilize its possible resources efficiently on its other operations rather than acquisitions of those companies slowing the NHW strategy development.

Segmentation Analysis

Demographic Segmentation

The demographic segmentation of Business is based on four elements; age, gender, earnings and profession. Business produces several products related to babies i.e. Cerelac, Nido, and so on and associated to adults i.e. confectionary items. Kulicke And Soffa Industries Inc In China Transferring Knowledge A items are rather economical by practically all levels, but its major targeted customers, in regards to income level are middle and upper middle level consumers.

Geographical Segmentation

Geographical division of Business is made up of its presence in almost 86 nations. Its geographical segmentation is based upon 2 primary elements i.e. average earnings level of the customer in addition to the environment of the area. Singapore Business Business's segmentation is done on the basis of the weather condition of the region i.e. hot, warm or cold.

Psychographic Segmentation

Psychographic segmentation of Business is based upon the personality and life style of the client. Business 3 in 1 Coffee target those consumers whose life style is rather busy and do not have much time.

Behavioral Segmentation

Kulicke And Soffa Industries Inc In China Transferring Knowledge A behavioral segmentation is based upon the mindset understanding and awareness of the client. For instance its extremely healthy products target those customers who have a health mindful mindset towards their intakes.

Kulicke And Soffa Industries Inc In China Transferring Knowledge A Alternatives

In order to sustain the brand in the market and keep the client undamaged with the brand name, there are two choices:
Option: 1
The Company ought to spend more on acquisitions than on the R&D.
1. Acquisitions would increase overall assets of the company, increasing the wealth of the business. Spending on R&D would be sunk expense.
2. The company can resell the obtained systems in the market, if it stops working to implement its strategy. However, amount invest in the R&D could not be revived, and it will be considered totally sunk expense, if it do not offer possible results.
3. Investing in R&D offer sluggish development in sales, as it takes very long time to present an item. Acquisitions supply fast outcomes, as it offer the company currently developed item, which can be marketed quickly after the acquisition.
1. Acquisition of business's which do not fit with the company's worths like Kraftz foods can lead the business to face misunderstanding of customers about Business core values of healthy and nutritious items.
2 Big costs on acquisitions than R&D would send a signal of business's ineffectiveness of establishing innovative products, and would results in consumer's discontentment.
3. Big acquisitions than R&D would extend the line of product of the business by the products which are currently present in the market, making business unable to introduce brand-new ingenious products.
Option: 2.
The Business needs to invest more on its R&D instead of acquisitions.
1. It would enable the business to produce more ingenious items.
2. It would offer the company a strong competitive position in the market.
3. It would make it possible for the business to increase its targeted clients by presenting those products which can be offered to a completely brand-new market segment.
4. Innovative products will provide long term benefits and high market share in long run.
1. It would reduce the earnings margins of the company.
2. In case of failure, the whole costs on R&D would be thought about as sunk expense, and would impact the business at big. The danger is not in the case of acquisitions.
3. It would not increase the wealth of business, which could provide a negative signal to the financiers, and might result I decreasing stock prices.
Alternative 3:
Continue its acquisitions and mergers with significant costs on in R&D Program.
Vrio AnalysisPros:
1. It would allow the business to introduce brand-new innovative items with less risk of converting the spending on R&D into sunk expense.
2. It would provide a favorable signal to the financiers, as the total possessions of the company would increase with its considerable R&D spending.
3. It would not impact the earnings margins of the company at a big rate as compare to alternative 2.
4. It would supply the business a strong long term market position in regards to the company's overall wealth along with in terms of ingenious products.
1. Risk of conversion of R&D costs into sunk cost, greater than alternative 1 lesser than alternative 2.
2. Threat of misunderstanding about the acquisitions, higher than alternative 2 and lower than option 1.
3. Intro of less variety of innovative items than alternative 2 and high number of ingenious items than alternative 1.

Kulicke And Soffa Industries Inc In China Transferring Knowledge A Conclusion

RecommendationsBusiness has remained the leading market player for more than a years. It has actually institutionalized its strategies and culture to align itself with the marketplace changes and customer habits, which has actually eventually enabled it to sustain its market share. Though, Business has established significant market share and brand name identity in the urban markets, it is suggested that the business must concentrate on the backwoods in terms of developing brand name loyalty, awareness, and equity, such can be done by creating a specific brand allotment technique through trade marketing methods, that draw clear difference between Kulicke And Soffa Industries Inc In China Transferring Knowledge A products and other rival items. Furthermore, Business must leverage its brand name picture of safe and healthy food in catering the rural markets and also to upscale the offerings in other categories such as nutrition. This will allow the company to establish brand equity for recently introduced and already produced products on a greater platform, making the effective use of resources and brand name image in the market.

Kulicke And Soffa Industries Inc In China Transferring Knowledge A Exhibits

PESTEL Analysis
Governmental assistance

Changing standards of international food.
Improved market share. Changing assumption towards much healthier items Improvements in R&D as well as QA divisions.

Introduction of E-marketing.
No such effect as it is good. Problems over recycling.

Use sources.

Competitor Analysis
Business Unilever PLC Kraft Foods Incorporation DANONE
Sales Growth Greatest given that 6000 Highest after Business with less development than Service 8th Lowest
R&D Spending Greatest given that 2007 Greatest after Organisation 2nd Least expensive
Net Profit Margin Greatest given that 2007 with rapid growth from 2008 to 2011 As a result of sale of Alcon in 2014. Almost equal to Kraft Foods Consolidation Nearly equal to Unilever N/A
Competitive Advantage Food with Nutrition as well as health variable Greatest variety of brands with sustainable methods Biggest confectionary as well as refined foods brand worldwide Biggest dairy items and also bottled water brand name worldwide
Segmentation Middle and also top middle degree customers worldwide Individual customers along with house team All age as well as Income Consumer Groups Middle and also upper center level consumers worldwide
Number of Brands 4th 3rd 7th 2nd

Quantitative Analysis​
Analysis of Financial Statements (In Millions of CHF)
2006 2007 2008 2009 2010
Sales Revenue 66282 854894 248815 825165 318225
Net Profit Margin 1.32% 5.99% 25.43% 5.86% 93.37%
EPS (Earning Per Share) 49.23 6.37 6.19 8.95 46.88
Total Asset 446827 557497 927384 411839 94947
Total Debt 12847 24774 57529 89217 89222
Debt Ratio 86% 87% 36% 23% 57%
R&D Spending 2889 3247 6624 8316 3827
R&D Spending as % of Sales 8.54% 8.11% 9.13% 1.35% 3.75%

Executive Summary Swot Analysis Vrio Analysis Pestel Analysis
Porters Analysis Recommendations