Lotte Confectionary Case Study

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I. Introduction
Established in 1967 as a subsidiary of Lotte Group, Lotte Confectionary has wide range of products including chewing gum, cookies, ice-cream, chocolate pies, snacks and biscuits. Selling in 70 nations all over the world, Lotte Confectionary owns approximately 300 patents and brands and this shows how active they are in the international markets. According to their annual report in 2015, their profit goes up to $32,179,800, equivalent to the increase of $836,190 compared to the figure of 2014.
At the present, Lotte Confectionary ranks the third position in the chewing gum industry and is well-known for their confectionary products and candy-related goods (Lotte, 2016). Operating based on “bring prosperity and happiness to the
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The availability of delivery and selling channels from the past in South Korea, Japan and other nations has made up their first advantage. To be more specific, various shopping malls named Lotte have set up by Lotte group as their favorable distribution networks for their products in not only domestic but also the global markets. Acting as advertiser for the company’s goods, retail stores of Lotte in South Korea is developing stronger than ever. In addition, their producing abilities within the nation are very strong compared with their rivals because the corporation is the most influential part of the Lotte group with high growth rate yearly. Prices of their candy products are also quite lower than competitors as they have built up a lot of manufactories in developing countries where the labor costs are really low. Last but not least, owing a large number of expert as well as well-trained workers, the working ability is constantly growing along with the advanced culture of company in terms of value, rareness, costly-to-copy and incompatible …show more content…
Lotte has very fews options to finance their operations compared to their rivals whose owners are stakeholders since lotte is a family-owned corporation. As a result, lotte may deal with higher debt ratio when raising funds to introduce new products or projects or their developments are much depended on their net profits from business. In addition, along with many advantages, the potential competitions from other confectionery enterprises in the coming time are unavoidable for lotte. According to UK essays (2015), applying both "me too strategy" and "imitation strategy" helps lotte cut down cost for innovating new goods as well as new markets, extending delivery networks but it does not ensure that this strategy will not pose threats from its competitors who can also implement these strategies to develop rare or costly-to-copy

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