PEST ANALYSIS
Political
1. For most markets the political environment is favorable for Samsung however the company faces certain political pressures in Latin America and some African countries. Political environment in some of the countries in these region is unstable and is prone to frequent changes in the governing structure. For instance brazil which has gone into recession majorly due to the political instability arising out of Petrobras scandal which involves the president Dilma Rousseff and Brazil’s largest oil company. According to a recent report Miss Rousseff’s popularity has sunk to a record low, inflation levels are much higher than central banks estimates and major companies are laying off thousands of employees. Many Brazilians …show more content…
Economies of Scale - Samsung has expanded its global footprint by expanding its operations into many developing markets (58 countries) and have been successful in achieving economies of scale. For instance Samsung has realized economies of scale in semiconductor production and has extended its production lines to china and other countries which results in the reduction of cost due to mass production.
5. Economies of scope - Samsung produces various electronics products such as LCD panels, smartphone, smart televisions, semiconductors, digital cameras and other related electronic devices which uses similar raw materials. The manufacturing of different products can take place in the same factory with workers having same knowledge which can result in the reduced cost of raw materials and easy to control quality and quantity of products.
6. Wide range of products at different price levels helps the company in targeting different customer segments. In case of developing countries, where wealth is unevenly distributed, this strategy is beneficial for Samsung as it offers high end smartphones for rich customers along with low cost mobile phones for price sensitive …show more content…
Samsung is a global company operating in both developed as well as developing economies. Despite the global image, the firm still operates as a Korean company internally and for this reason it has to change many global operations according to local conditions. Samsung has to change its product to match the changing preference of customer in certain markets.
2. Although Samsung sell a lot of TV’s and washing machine but it is the smartphones that have made Samsung a recognizable brand around the world. Samsung may not be as lustrous a brand as apple yet, it is the only brand which gives a direct competition to Apple smartphones and global sales of Samsung phones outsell iPhone.
3. Samsung operates in a market which is highly influenced by consumer’s lifestyle preferences. Socio-cultural factors vary in each country and so the company has to reorient its strategies accordingly. Samsung follows a try everything strategy wherein they manufacture every kind of handset that comes in every size for every market and at every price.
4. Increasing popularity of electronics devices for personal as well as professional purposes along with rising household income especially in emerging economies have made the innovative products offered by Samsung
Political
1. For most markets the political environment is favorable for Samsung however the company faces certain political pressures in Latin America and some African countries. Political environment in some of the countries in these region is unstable and is prone to frequent changes in the governing structure. For instance brazil which has gone into recession majorly due to the political instability arising out of Petrobras scandal which involves the president Dilma Rousseff and Brazil’s largest oil company. According to a recent report Miss Rousseff’s popularity has sunk to a record low, inflation levels are much higher than central banks estimates and major companies are laying off thousands of employees. Many Brazilians …show more content…
Economies of Scale - Samsung has expanded its global footprint by expanding its operations into many developing markets (58 countries) and have been successful in achieving economies of scale. For instance Samsung has realized economies of scale in semiconductor production and has extended its production lines to china and other countries which results in the reduction of cost due to mass production.
5. Economies of scope - Samsung produces various electronics products such as LCD panels, smartphone, smart televisions, semiconductors, digital cameras and other related electronic devices which uses similar raw materials. The manufacturing of different products can take place in the same factory with workers having same knowledge which can result in the reduced cost of raw materials and easy to control quality and quantity of products.
6. Wide range of products at different price levels helps the company in targeting different customer segments. In case of developing countries, where wealth is unevenly distributed, this strategy is beneficial for Samsung as it offers high end smartphones for rich customers along with low cost mobile phones for price sensitive …show more content…
Samsung is a global company operating in both developed as well as developing economies. Despite the global image, the firm still operates as a Korean company internally and for this reason it has to change many global operations according to local conditions. Samsung has to change its product to match the changing preference of customer in certain markets.
2. Although Samsung sell a lot of TV’s and washing machine but it is the smartphones that have made Samsung a recognizable brand around the world. Samsung may not be as lustrous a brand as apple yet, it is the only brand which gives a direct competition to Apple smartphones and global sales of Samsung phones outsell iPhone.
3. Samsung operates in a market which is highly influenced by consumer’s lifestyle preferences. Socio-cultural factors vary in each country and so the company has to reorient its strategies accordingly. Samsung follows a try everything strategy wherein they manufacture every kind of handset that comes in every size for every market and at every price.
4. Increasing popularity of electronics devices for personal as well as professional purposes along with rising household income especially in emerging economies have made the innovative products offered by Samsung