According to the person who in charge of Cataracts,Cataracts business model is based on three old raising a new store. Tang, 2004). The expanding means the profit point growth, at the same time the affection of scale to reduce the cost. Due to more and more profits and not subject to the capital limitations,Cataracts can expanding scale rapidly,this expansion is very astonishing. 1. 2 Risk The business license has certain risk, especially in the management and technical advantage. The licensed business operating in different from the franchise, ranching doesn’t need to put their patent and the technology to others, so that can be beneficial to protect their own patent and technology.
Therefore, the licensed business operating has certain risk to loss their technology. Fortunately, Cataracts foreign policy has been take retail mode and have a good management idea, so it greatly reduces the risk. All over the world company cannot Join in Cataracts ,they Adhere to the regular distributors company. (Chelsea,2012). On the one hand Retail mode can keep the quality of the chain, on the other hand it put forward to Cataracts n expansion capital requirements. Cataracts not only has the good business model, and also has good management technology.
All Cataracts retail market partners, whether full-time or part-time , as long as a year they working hours reach or exceed 360 hours in total, can have the Cataracts coffee beans stock. (Wang,2012) . Thus, it can not only improve the enthusiasm of the employees, and also can steady staff and reserved talents. Cataracts can reduce a certain risk of the management and technical advantage, mainly by retail mode and management technique. 2. Can you ague that Cataracts is a global company regardless of the stronger dominance of its home region in terms of its locations and sales.
Explain? Cataracts is not a global corporations . Because of global corporations is not Just sale or sell product in other countries . Global corporations have its own conditions. There are two important factors to make Shattuck cannot meet the global corporations completely. 2. 1 Locations Compared with the general multinational corporations, the global companies improve the degree of globalization greatly, the index of multinational is more than 0%. The overseas business inflection is importance to the home business gradually,more and more company resources is transfer to overseas. Inference on trade and development data show that in 1994, the global 100 big multinational companies multinational index more than 50%,it has 43 companies; it only has accompanies more than 70%. Some company’s equity also highly globalization, such attention to home business,the index of multinational does not exceed the global company’s requirements. Although it is direct management foreign markets,the head office to control all shops. So Cataracts is not a global company. 3. What accounts for the discrepancy between percentage of foreign locations and percentage of foreign net revenue.
Each corporation’s purpose is save money,Shattuck is no exception. Len order to make more profits,Shattuck constantly overseas expansion. Unfortunately some factors prevent the overseas development of Shattuck. 3. 1 Substitutes First of all, coffee is not the main drinks in each country, different places have different main drinks, such as: China main drinks is tea. Cataracts entering this country which has different culture in drink,it must do better. Otherwise it would be replaced by substitutes. But many people cannot give up their used to,. So Cataracts entering a new market is a difficult thing.
Drinking company ICC defeated Cataracts, amount of shops beyond Cataracts in Taiwan (China Daily, 2009). Due to many competitors in the market,people have many choose,it will effect the market share of Cataracts directly. 3. 2 Excessive expansion Second, the excessive expansion. Cataracts expansion speed is very quick in overseas,Although the expansion is good for dominate the market,it need to has great trainees can keep the high profits. According to the person who in charge of Cataracts,Cataracts business model is based on three old raising a new store(Tang, 2004).
Cataracts expanding constantly in order to dominated the market,but it do not considering the market popularity and saturation problem. So that it loss more profits and make the profits and shops are not in proportion. 4. What are some of the reasons why Cataracts choose to retain operational control of its domestic operations? Retain operational control have some advantages for Multinational company 4. 1 Easy to manage Cataracts choice retain operational control of its domestic operations,it can control its domestic business management and technological advantages greatly.
Head office thinks that it is good for professionalisms of staffs capabilities and establish prefect corporate image (Yuan, 2008). They can directly manage the store and directly market. 4. 2 Rise awareness Cataracts choice keep its domestic business operation control to make many scattered branch can deep into the hinterland of consumers to expand sales, accounting for the market. In mass production system and large amount of institution market conditions, the retail chain operation system is links mass production, large amount of consumption of new circulation system.
Only in this way, Cataracts can through the spread of customers to improve their awareness. Cataracts still use this way to improve his own popularity, up to now. So it is very important to Cataracts maintain the quality of its products, to improve their own profits. Therefore, Cataracts should choose to keep its domestic business operation control. 4. 3 Largest market Because Cataracts does not belong to the global company, it is multinational many, so it is pay more attention to the domestic market.
Cataracts is beginning for the United State,so the United States is Stardust’s biggest market and the United States income occupy the major source of income. Cataracts in the United States occupy about 85% of the total revenue income each year, the United States market share more than other countries several times larger. MIM,2012). Market share is very important to each companies. The Cataracts sales volume in the United States is the largest,so Cataracts should choose to retain operational control of its domestic operations.