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› 

‡ 1963 MKC established

‡ 1971 First international Venture


(Australia )

‡ 1979 First MKC representative to


reach $1 million in Sales

‡ 1991 Wholesale sales reach


$500 million
   
‡ Weak international presence
± Lack Adaptation
± 11 % of total sales

‡ Need foothold in Asian market


± Opportunity for Growth

‡ Japan vs. China


JAPAN vs. CHINA
JAPAN CHINA

124 Million People 1.14 Billion People

Mature / Saturated Little Competition

Experience with Direct Little Experience


Sales

Low Growth potential High Growth Potential


V  
 

Successfully gain a foothold in a


large and influential Asian
Market
  
 
To enrich the lives of Chinese
women by providing them with
extraordinary skin care and
cosmetic products while providing
them the opportunity for financial
freedom and self-development
Issues Identification

   

‡ Population
± 1.2 Billion in 1992 and 1.5 Billion in
2020

‡ 75% of household income is


disposable

‡ Women usually controlled the family


Budget

‡Urban Consumer
± Average age: 32
± Married
± One child
± Attracted to foreign brands
± Attracted to education

      

‡ Skin Care vs. Make up

‡ Low Income

‡ Small Housing

‡ State Jobs
± MKC ± Part-time, 2nd job

‡ Lack of experience with Network


Marketing
    

‡ Creating effective branding

‡ Adapting business plan

‡ Finding manufacturing
facility
V

‡ Over a billion people in China

‡ Popularity of skin care treatment


products

‡ Disposable income

‡ Large job force

‡ Great interest in foreign brands


Analysis of Alternatives

V     

1. Strategic Alliance
2. Manufacturing
3. Import Goods
V   



‡ Market experience ‡ Less control
‡ Brand recognition ‡ Dividing profits
‡ Existing outlets ‡ Value clash
‡ Decrease risks ‡ Possible
misunderstanding

 



‡ Lower transportation ‡ High development costs
costs ‡ Long-term and high risk
‡ Direct control investments
‡ Local demand ‡ Government issues
Forecasting ‡ Time investment



‡ Low risk
‡ Quality control
‡ Less start up time


‡ High tariffs
‡ Transportation
expense
‡ High product lead
times
USA production facility
Phase I- Preparing to go to China

Phase II- Establishing in China

Phase III- Future of MKC in China


Phase I- Preparing to go to China
Establishment in Shanghai

‡ Adaptation of Compensation
Plan

‡ Suitable Product Mix

‡ Initiation of Brand Awareness


p   V
‡ Headquarter establishment
± Administration
‡ Product support

‡ Compliance

‡ Training
± Main Warehouse

‡ Distribution Center

‡ Storage

‡ Packaging

‡ Bulk shipment
    
‡ Beauty Consultant Showcase
± Price range: $10, $12, $16
‡ 3 months Order: $20
‡ Reward Incentives
± Top 5%
‡ Expense paid-trip Dallas¶ HQ
± Top 10%
‡ Cosmetics Rewards Package
± Top 25%
‡ Pink MKC Messenger Bag
p   
  
‡ Build Brand Equity

‡ Build Product
Awareness

‡ Focus on Growth

‡ Personal Customer
Service
 p     %  

± Product message 


   ! " "
‡ Skin care & cosmetics provider p 
‡ Unique employment # V   
# V    
opportunity     
± Product positioning #    $   
#
 
‡ Mid-price

&%
V    
#
$  
# &     
# V   
V '(   
# 
V 
  
›)'( V  
#  
# !   
 

‡ Manufacturing plant
acquisition

‡ Strategic alliances to
diversify
product line

‡ Market research for


future
provinces

  

‡ Chinese Market ± ‘  



 
‡ Keys to Success In China
± Cultural „ (Sales / Recruiting)
± Effective Ad Campaigns (Gong Li)
± Agility
‡ Long-term Focus
± Short-term costs Long-term Gains
± @    to the marke
O *
O    O     
%
+,-. USA +,,. Singapore ? Switzerland
+,/+ Australia +,,. Russia 1993 Moldova
+,/0 Canada +,,1 UK ? Netherlands
+,01 Argentina +,,2 Brazil ? Lithuania
+,02 Uruguay +,,2 Japan ? Latvia
+,0- Germany +,,3 China ? Estonia
+,00 Malaysia +,,3 Portugal ? Dominican Republic
+,00 Mexico +,,- Finland
+,00 Thailand +,,/ Czech Republic
+,,+ New Zealand +,,/ Ukraine
+,,+ Guatemala +,,, El Salvador
+,,+ Taiwan +,,, Hong Kong
r  V    

r  V     

r     V

r    r  

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Abhishek Gaurav Ravit Sakshi Trishla