The paper 'International Business and Samsung ' is a great example of a Business Case Study. Samsung is a South Korean multinational company founded by Byung-Chull Lee in 1938 (Lee 2006, p. 2). Since then, the company has grown to become a leader in the electronics industry. Samsung specializes in the manufacture of a variety of electronic products, including mobile phones, television, cameras, refrigerators, tablets, and many other home appliances. Although the company began small in Taegu South Korea, the company has since grown and has a presence in many countries across the globe.
Samsung is among the most profitable electronic companies in the world. In 2009, for instance, the company generates a revenue totaling $117.8 billion (Reuters 2015). Despite the success that the company has registered in the international market, Samsung has faced many challenges in the recent past that are likely to affect its position in the market in the near future. The aim of this document is to analyze Samsung’ s position in the international market with a focus on challenges and its competitive advantage and whether or not Samsung’ s competitive advantage will be sustainable in the long run. Challenges Facing Samsung Samsung is currently the leader in the electronics industry, a position that it has maintained for many years now.
The company’ s success over the years has largely been attributed to the high demand for its products both locally and internationally. Despite the successes that the company has registered over the years, Samsung has been facing many challenges in recent times, something that threatens its position in the market. Samsung’ s first major challenge in recent times has been stiff competition.
The electronics industry is amongst the most competitive industries in the world. Currently, Samsung is facing stiff competition from quite a number of companies, including Apple, LG, Sony, HP, Microsoft, Techno, and Chinese smartphone makers Xiaomi and Lenovo among others (Michell 2011, p. 11). The competition that Samsung faces from these competitors has seen the firm’ s profits fall to its lowest in three years. According to Samsung’ s 2014 annual report, the firm’ s profits to $21.3billion, making a 27% drop in profits compared to 201 (Reuters 2015). Samsung has attributed the fall in its revenue and profits in recent times to the growing competition from other firms, such as Apple and the Chinese smartphone makers Xiaomi and Lenovo. BBC News (2014) report shows that Apple has been the major competitor that has contributed largely to Samsung’ s latest woes.
The report shows that the move by Apple to introduce the iPhones with larger screens snatched Samsung’ s Galaxy phones a big market share. The BBC News (2014) report also revealed that Samsung’ s latest slump in performance has been caused by the entry of Chinese low-end phones manufactured by Chinese companies, such as Xiaomi, Levono, and Huawei.
These Chinese Smartphone makers have reportedly introduced a variety of smartphones that cost far much less than what Samsung charges for its products. The low prices charged by Chinese Smartphone makers have seen them snatch a significant Samsung’ s market share, thereby causing a slump in revenue and profits.
BBC News 2014, Samsung Electronics profit falls to lowest in three years. BBC News 30 October, viewed 11 July 2015 http://www.bbc.com/news/business-29828484
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Reuters 2015, Samsung inches closer to losing smartphone primacy, viewed 11 July 2015 http://www.businessdailyafrica.com/Corporate-News/Samsung-inches-closer-to-losing-smartphone-primacy/-/539550/2605994/-/nbn7tk/-/index.html
The Economic Times 2015, Samsung leads India mobile phone market, but losing grip: CMR. The Economic Times 8 February, viewed 11 July 2015 http://articles.economictimes.indiatimes.com/2015-02-08/news/58928746_1_smartphone-segment-smartphone-market-market-share
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