Beijing Mirror Corp.
February 17, 2005
1. Can Beijing Mirror develop the market by itself? Why or why not?
I think that Beijing Mirror would have difficulty in developing the market by itself. Although they have successfully developed a product that is priced lower, than similar technologically advanced products, and the market for rearview mirrors maybe quite large in China (1.4 million new cars manufactured each year, with a growth rate of 15-20%) and globally, but they are lacking certain things that would allow them to develop this market by themselves. These mirrors may have passed Chinese quality standards, but further development of the product may need to be done for them to meet standards and regulations internationally. This problem could hinder their timely entrance into the global market. Another problem hindering them is that they have inexperienced management and marketing capabilities that need to be improved.
Their marketing team consists of only a few people, and they have not been aggressively pursuing the market, with most of their orders only being small ones.
2. What is the firm's basis of sustainable competitive advantage (SCA)?
Beijing Mirror has many core competencies that should sustain them in the market. Firstly, they have a lot of support for research and development, since this product was developed initially with the help of Tsinghua University, after which they were granted patents in 19 different countries. These numerous patents will aid in preventing competition from copying or stealing their design. Another competitive advantage they have is, that in the current market, there are no substitute or competitive products that can match the price and capabilities of their product. The product was tested by the China Motor Vehicle Safety Appraisal and Inspection Centre, was then certified, and a national standard, in China, was...