Haier Group (Haier), a government owned company, manufactures household appliances and electronic products in over 15,100 different specifications under 96 categories. Haier products are sold in over 100 countries around the globe. Haier Group primarily operates in Asia, Europe, Oceania and North America. The company is headquartered in Shandong, China and employs about 50,000 people.
In the following analysis, a brief discussion of the appliance and small electric industry will take place followed by recommendations for Haier to raise brand awareness and increase market share. In particular, there will be discussion of: raising brand awareness through innovation and superior customer service, a plan to exchange logistics information with other industry players, and to increase service to the developing nation in rural China (Haier's home country).
The Household Appliance MarketIn order for Haier to accomplish its goals of increasing brand awareness and expanding its market share, the company must be aware of its areas of strengths but more importantly its areas of weaknesses as well as the business environment in which it runs.
In studying the Porter model, Haier will accomplish this and will therefore be more equipped to make decisions most likely to help the company reach its goals.
Porter's Model - Global Industry Analysis forHousehold Appliances and Electronics ProductsThreat of new entrants:High capital requirements -It is very difficult and time consuming to build a global household appliance and electronics company. All major players have been in the industry for over 30 years. However, it is possible to enter specific niche product segments and build up from there.
Threat of substitutes:Other global powerhouse brands such as GE, Whirlpool, and Kenmore.
Rivalry among existing firms:Concentration: Major competitors are: Whirlpool Corporation, General Electric Company, Siemens AG, AB Electrolux, Samsung Group, Daewoo Business Group, LG Group, Sharp Electronics, Sony, Apple, etc.