Samsung, one of the biggest mobile manufacturers in the economy recently dropped the news that the company has ended mobile telephone production in china. The shutdown of Samsung’s last china phone factory comes when the company got miffed by facing intensifying competition from domestic rivals on the world’s biggest smartphone market. This, in turn, happened because of the rising labor costs and economic slowdown. And the similar news arising in the market of Sony shutting down its plant in Beijing because of the certain similar reasons. The gadget market in china has always been on the top and China is the biggest manufacturing base of all the gadgets and electronics. This giant tech company will continue to do sales in China but the operations & manufacturing are definitely not going to take place in the nearby future. An efficient move take by the company is to shut the manufacturing in the countries with high labor cost and manufacturing costs & to expand smartphone production in lower-cost countries like India and Vietnam. In china, people tend to buy low priced products from the country’s domestic brands and the premium segment in China buys high-end mobile phones from the brands like Apple. Thus, Samsung remains with very average number of sales. To boost the production by saving the cost, Samsung chooses a strategy to diversify the operations in the areas with less costs and less competition. The elimination of Samsung will definitely affect the electronic segment but from the point of view of competitors, their profits will be increased.
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