French tiles corporation(attempting to go internationally)

Essay by dejizUniversity, Master'sA, February 2006

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French tiles corp. (FTC) is a French company based in the northern part of France. It is own by Mr. Bourdon. Recently he has been able to develop a new process of synthetic tiles. These new tiles have a good capacity of isolating temperature, humidity and noise. Because of this he has been able to sell them at a higher and more expensive price than the competitive product.

Customers of the corporation:

- Private customers revamping their houses.

- Small entrepneur for private.

- Architect, engineering officers and final customers.

Two people to help bid the tenders for significant orders. Example:

- Railway (public tenders).

- General contractors or civil builders (direct contacts and private tenders).

- Promoters of offices and habitation (Public office for low cost or private promoters).

Competitors: (Facing problems where FTC benefits).

- Italian manufacturers: Handicapped by transportation of heavy product.

- Eastern Europe manufacturers sell more current products but cheaper.

FTC advantages:

- Delivers on site.

- Good penetration in neighboring countries.

- Turnover $ 5 M for the last 6 years.

- Need for investments decreased.

- Plant is well run.

- Products satisfying customers.

- Orders come in easier.

- Patent registered to cover its process.

- As Italian manufacturer are handicapped by transportation of the heavy product this will transform to an advantage for them.

FTC disadvantages:

- Manufacturing cost 70 % of sales.

o 34 % Direct labor (VC).

o 30 % material (VC).

o 6 % plant overhead (VC and FC).

- 3% profit margin after tax.

How their international action should be planned?

International action is a very essential for business survival it has been adopted by several business in order to have growth .Example : FIAT company in the mid 1990's has expanded to EU...