I thought that Schumpeter’s latest post was interesting because he pointed out even though the consumers’ willingness for buying a car was low in Mexico, some car industries such as Nissan, Mazda and Honda still tried to expand their business there and continuously invested  money on it.

Recalled what we had learned in the class talking about operation, I believe that the reason why car industries still interested in Mexico is it accelerates the inventory velocity. Since Mexico is near to the world’s biggest car market- America, it takes less time for car industries to ship their products to the market, which means that the inventory time is short. Therefore, it helps company to save money on some fixed costs, such as rent, electricity bills and shipping fees. In other words, If the selling price of a car is unchanged, pulling down the cost will definitely increase companies’ profits.

According to Lynn’s blog, WeChat becomes the most popular Apps among teenagers around the world for 2 main reasons. One reason is that WeChat is mostly being used by Chinese. The other reason is that it can send voice message to others.

Undoubtedly, China’s large population contributes to WeChat’s growth. Personally, I think the main reason why it is outstanding is its value propositions.

Firstly, voice messages is one of the most attractive parts for its users, especially teenagers studying abroad. They are too busy to type the words, using voice messages seems more convenience to them. Moreover, most of the parents are not good at typing, it may takes time for them to communicate with their children. However, by using WeChat, they can talk with each other easily.

Additionally, the privacy is another reason why WeChat is so popular. For instance, a user can edit his or her friends into different groups so that the user can choose which groups of friends he or she is going to share the post to. Those people who haven’t been chosen cannot see the post.

According to the latest news, there is an increasing number of people who prefer tea rather than coffee, which indicates a huge potential market for tea producers.

For example, Teavana, a popular tea shop, provides various types of tea, such as Oolong tea, Black tea and Green tea to satisfy different people’s needs. The brand was first built by a couple, who came out of an idea while traveling abroad, noticing that tea was popular among citizens there. This is an entrepreneurship since nobody was interested in tea in USA at that time.

Teavana has created a few value propositions for its customers. Firstly, they change the perspective of tea in people’s mind. In other words, they make tea seemed more fashionable. Both the stores and the website are well-designed, giving the customers a value added, comfortable feeling as if they are in a boutique hotel instead of a tea shop. Moreover, combinations were made with tea and western traditional festival. For instance, upcoming occasions such as Christmas would develop a new marketing strategy where Teavana would design some tea products not only to be purchased as a collection by customers but also to be given as a Christmas gift.

Source:

http://www.cbc.ca/news/business/rising-tea-sales-drive-profits-for-beverage-chains-1.2424091

According to Paco Lee’s latest post, Facebook has launched a new promotion method, which  readers could increase the amount of their likes of their posts by paying $7. He pointed out that this service is not available to the user who has less than 5000 friends. Meanwhile, he also questioned the availability of their post on their friends’ newsfeed.

For example:

After reading his post, several counter-arguments came up to my mind. First of all, if an individual has more than 5000 friends, is it necessary for he or she to use this method to promote the post? They already have enough followers.

In addition, external research on Facebook also depicts that post promotion is currently not available to everyone, yet it does not mention the specific details or requirements. Then, it emphasizes the fact that even if a user does not promote the post, other people can still see it.

Last but not least,by promoting posts, individuals can benefit more than small businesses. For small businesses or larger groups, it is more efficient for them to use other sorts of Facebook’s promotions such as Page posts Ads and Market Place Ads to enhance their advertising and marketing segments.

Source:

http://www.insidefacebook.com/2013/01/11/understanding-the-difference-between-facebook-sponsored-stories-page-post-ads-promoted-posts-and-marketplace-ads/

Ottawa decides to think over the Shell’s Jackpine oilsands mine expansion program since the government need to make the trade-off between profits and sustainable developments.

When the government decides whether the project should be implemented, it should evaluate it through 3 aspects: planet, profit and people. In other words, the government need to concern more about the sustainable development.

Undoubtedly, this project will definitely create more economic profits. It is said that once the expansion is completed, it will increase almost 50% of the current output of bitumen. As such, Shell will become the biggest winner in the game and reap more profits than before.

However, when it comes to the planet, the devastating effects are inevitable and irreversible. For instance, the company amasses higher profits at the cost of 8,500 hectares of wetland, which will dramatically decrease the habitat of wild animals.

Additionally, the expansion of the mine will also harm the residents living around the mine. The utility of the navvy, tower crane and pile driver will make noises, which will influence the residents’ daily life.

In conclusion, I believe that the disadvantages of expanding the Jackpile Oilsands mine outweigh its advantages.

Source:

http://www.cbc.ca/news/politics/ottawa-delays-decision-on-controversial-jackpine-oilsands-mine-1.2420187

Over the years, Kmart starts their operation hours on Black Friday earlier and earlier. This year, it will open from 6 a.m. to 11 p.m.

In Canada, the function of the Boxing day is almost the same as the  Black Friday in the USA. Most companies will reduce prices to some extent in order to increase the sales of their products. Even though the marginal profit of the product might not be as high as it was, the performance of the company will be better presumably it uses the inventory turnover equation to evaluate the company’s performances. The inventory turnover equation, which comprised of the cost of goods sold divided by the average inventory, indicates the quickest and the most effective way to improve a company’s performances as it lessens the total amount of inventory in a company.

However, high inventory turnover rate does not necessarily mean higher profits since it only takes into account on the costs and the inventory. For instance, the person who wants to improve his or her own performance can just give the product to anyone else for free as the ratio is not related to the revenue. To prevent this from happening, companies should use various financial ratio to justify the performances, otherwise the evaluation may be invalid and inaccurate.

Source:

http://business.time.com/2013/11/05/kmarts-black-friday-starts-on-thanksgiving-thursday/

According to the latest news, Facebook gradually lost its teenagers customers due to the lack of novel updates. The increasing number of teenagers turn to other social media, such as Twitter, Instagram and Snapchat.

When it comes to the Facebook, the word “flexibility” and “connection”  may pop into people’s mind. However, as time goes by, new competitors find the differentiation to compete with Facebook. For example, Twitter provides instant news with a word limitation, and Snapchat are popular because of the photo messaging. Therefore, Facebook face a serious crisis- threats of substitutes.

Also, teenagers play a pivotal role in the customer segment for all the companies talking above, and nearly all of them are examples of organizations that unified business and information technology. If Facebook wants to win teens back, it need to take advantages of its database, such as customers profile and teenagers’ preferences, finding out the new trends among teenagers.

perceptional map

source:

http://www.cbc.ca/news/canada/manitoba/facebook-profits-at-risk-as-teens-look-elsewhere-1.2356209

According to the news, McDonald is planning to transform Heinz out of its restaurant since the recent detrimental changes of Heinz’s management, which implies that this nearly 40 years relationship is at its end.

According to my analysis, the two main reasons of this situation are Man and Suppliers. The spokesperson pointed out that they end the contract with Heinz since it hires McDonald’s competitive rival—Burger King’s former CEO as new chief. Moreover, Heinz’s weak supplier power also causes this situation. Firstly, it has many competitive suppliers, such as Del Monte and Pampero. Then, ketchup is considered as a basic commodity, which determines that Heinz ketchup has less supplier power from the beginning.

In addition, Heinz provides ketchup to McDonald’s overseas marker. If McDonald’s choose a local supplier there, it can save the money spending on shipping or packaging, effectively decreases the cost. Since most customers would not have a specific preference on the ketchup used in McDonald, it is not arduous to change suppliers based on their cost effectiveness. McDonald should allocate its expenses and resources cost efficiently to maximize their profitability.

fishbone diagram

source:

http://www.cnbc.com/id/101144721

According to the article, Airbus made a deal with Japan Airlines (JAL), which valued nearly $9.5bn. It has been seen as a landmark since Boeing was once the dominator of Japan’s aviation market.

Value proposition of Airbus

• To: civil airplane companies who want more fuel-efficient aircraft
• Our: environmental and fuel-efficient aircraft manufacturing company
• is: providing aircraft to civil airplane companies, such as JAL, Ethiopian Airlines and Qingdao Airlines
• that: providing several point-of-difference benefits

When it comes to the point-of-difference benefits of Airbus, it has to contain the following points. Initially, it provide the fuel-efficient aircraft to its customers, reducing their costs and maximizing their profits. Also, it manufactures environmental products. Compared with other aircraft manufacturing companies, Airbus is the first aerospace business to become ISO14001 certified. What’s more, the safety of Airbus’s production is generally accepted. However, its largest competitor, Boeing, has got involved in safety issue since its Boeing 787 Dreamliner caught fire in London on July 13th, 2013.

source:

http://www.bbc.co.uk/news/business-24424873

http://online.wsj.com/article/SB10001424127887324425204578601752534401168.html

Both Toyota and Nissan, two major manufacturers from Japan, issued fresh vehicle recalls in U.S market. Toyota decided to call back Sienna minivans since it could shift out of park mode without the driver depressing the pedal. Meanwhile, Nissan issued a recall in order to prevent accidents from using the unstable accelerator pedal’s sensor.

Issues:

Both the company experienced a trust crisis

Analysis:

Consumers may have less interest in purchasing cars made by Toyota or Nissan. According to BBC news and China Daily, this is not the first time that Toyota issued a recall. Such continuously recall will absolutely lower consumers’ demand on Toyota since the safety of those cars are being questioned.

Recommendation:

Winning back consumers is high on the agenda of Toyota and Nissan. Initially, eliminating the safety problem in the process of production is deemed to be both high urgency and high importance. It could be achieved by using a new technology, trying other materials and testing various methods. In addition, before bringing a new product into the market, the company should test them under strict rules. Once a problem being found, they should stop the production immediately. Last but not least, by showing the statistics to public, it is also a wise method to rebuild consumers trust, which represents a sense of responsibility and the concern for consumers.

source:

http://www.bbc.co.uk/news/business-24294019

http://www.chinadaily.com.cn/world/2010-04/17/content_9743279.htm