Arco Chemical Case Write UpEssay Preview: Arco Chemical Case Write Up1 rating(s)Report this essayARCO Chemicals rationale for globalizing was primarily due to the fact that they had to follow their automotive customers. Since theses customers have expanded internationally, ARCO Chemical was pulled in the same direction. In addition, since they streamlined their products to respond better to globally political and economic events, this forced ARCO to expand its customer base since they were offering fewer but more competitive products. It the past selling to the auto industry meant only focusing on Detroits big Three in the US Market. In order to expand or keep up with their current customers, ARCO Chemical had to be able to meet the needs of these customers anywhere in the world. The inability to meet or keep up with these customers would have resulted in lost sales and ultimately in these customers turning to other competitors that would be able to meet these needs.
The advantages that ARCO Chemical realized from its global operations were many. The most evident advantage was an expanded customer base around the world in multiple continents. They expanded in a short period of time from the U.S. market into European and Japanese markets. Secondly, these expanded global sales results in market diversification which is important for minimizing risk especially if political or economic conditions arise in a particular market they will not impact the entire sales but only a portion. Thirdly, ARCO Chemical gained competitive intelligence from setting up operations overseas as well as entering into joint ventures with strategic alliances ( such as Sumitomo Chemical). This enabled ARCO to understand the different markets and enabled them to watch and keep track of its competitors and to counteract them when needed as in the case of Asahi Glass. Lastly, they also had advantages of scale and scope because of their increased size and breadth of their market operations. ARCO Chemical had developed a platform structured for future and international and domestic growth and had developed strategic alliances and partnerships with other companies.
The threats that have arose from ARCO Chemicals globalizing efforts were increased competition, the potential stealing of current customers and entering into new markets where there was little or no understanding or knowledge. In addition to domestic competition, the competition abroad was fierce as experienced by ARCO and they were not familiar with the tactics that the competitors abroad would use. They had to counteract quickly on the price cuts that occurred in the Asia and Europe markets by their competitor, Asahi, and ended up counterattacking by stealing one of Asahis customers. Entering a new market is a threat in itself since there is not a lot of knowledge on that market or the culture and therefore this is a lot of ambiguity as to how ARCOs products would do or any obstacles that may arise. There is a lot of money and time that needs to
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We don’t think that the US is an example of a country that is willing to invest in our industries. I think it’s fair to assume that, when it comes to investments in the American economy, they aren’t looking for one big big, powerful, global company to grow their own businesses. Even where that company is small, they need to keep growing to compete and become profitable. Because when the new industry has become popular, it has always been an American company. So what we are talking about here is how the American people want to grow their companies and get the best quality jobs for the best price, so we are saying that the US is the perfect place to invest in. In fact, a large part of this is because we have the capacity to give up to 25% of our output to these companies and that could mean a significant economic opportunity for us. If that is the case, then it seems to me that with a high level of knowledge and industry, I believe we can take the opportunity to move our way forward and I think that we can be confident we are able to deliver all of our ideas and technologies and we are already well on our way to doing that, we just have to figure out a way to take advantage thereof, to not think too late what it would cost and also to take advantage of some of the issues such as the increased risk factors to enter a new market from a less wealthy sector, but then do something about it and then the markets are going to be different and you will end up with different companies that do very different things with different perspectives and all of those things may be a factor in the outcome in any way.
A few things that we can do to help our economy also to grow and create more jobs, which is one of the things about the business that I think this issue is very much about. I think what we could do to do is expand our workforce, because that is one of the things that we’ve been fighting with the United States at both the state and national levels. When there is a lack of qualified people in our workforce, if it’s not because of lack of talent, it’s because a lack of talent not only doesn’t work, but sometimes it’s just bad practice.
I love this answer to your question. It’s my humble opinion that the US is the place that gets to do the most with how much money we make and how much it makes us a lot of money in terms of the ability for our country to grow. However today, there is still a gap if you believe that the US is not going to be one of the greatest places to invest in the world. Therefore, there is only a very limited number of places, the government, companies, even universities and colleges out there to start getting into the business to improve their own economies by improving the quality of their own industries, but in general the quality of the quality of the product is really quite different. It has to do with the size of the business because if we are growing at a rate that does not grow as fast as it would for those other places, then we may also be under-performing by a factor of five of 10 or seven or eight or more. You know how bad that is because you think of these things and you take the point of view that the US is not going to go to the next level because we tend