Slide 20:
Backward integration
¡ Enter
new industries that add value to its core products
¡ Currently
last stage in value added chain
¡ Currently
contracts out hardware
¡ By
manufacturing, attempt to minimize overall costs, and ultimately increase
profitability
Slide 21:
Backward Integrations:
¡ Pros
¡ Overall
minimization of costs that can be realized, resulting in profitability to the
downstream industry
¡ Can
achieve a competitive advantage
¡ Cons
¡ Entering
industries with no experience
¡ Increasing
cost structure
¡ Changes
in technology
¡ Unknown
demand (still does not remove dependence on Brazil)
Slide 22:
¡ ABC
Expansion
¡ Argentina
, Bolivia and Chile, the top 3 Latin American countries for expansion
¡ Market
development strategy using SICAT
Slide 23:
ABC Expansion
¡ Pros
¡ Road
congestion
¡ Few
competitors
¡ Similar
economy
¡ Rapid
growth
¡ Cons
¡ High
priced system
¡ Previously
unable to win projects outside Brazil
¡ Large
companies may also see potential
¡ Unstable
economies
Slide 24:
Recommendation
¡ Expand
to Latin American countries
¡ Most
importantly relieves the dependence that Compsis has placed on Brazilian market
¡ Allows
operations within the same industries they excel in
¡ Transfer
core products to new markets in countries similar to what the know
¡ Market
development
¡ Push
marketing strategy
Slide 25:
Implementation
¡ Open
sales office in Argentina and Chilie
¡ Build
relationship
¡ Introduce
additional products
Slide 26:
Conclusion
¡ Based
on the situation, company is in cash strapped.
¡ Best
way is to expansion in Argentina, Bolivia and Chile
¡ In
ABC, competition is less intense.
¡ Open
offices there by fostering relationship with these countries
