Cemex case article

Category: Finance,
Topics: United States,
Published: 25.12.2019 | Words: 1049 | Views: 365
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1 . Make clear the benefits that CEMEX plus the other global competitors in cement possess derived from globalization – how do cross-border actions add value in an industry as obviously localized as cement? CEMEX had only exported bare cement to the Usa in low prices than South america. After time goes by, The United States’ producers got banded with each other to resort an antidumping petition to guard their industry from Mexico’s dumping prices. After all, the U. H. International Trade Commission (ITC) imposed a countervailing responsibility on CEMEX’s exports by Mexico to the United States.

There after, CEMEX begun to focus on globalization especially Foreign Direct Investment (FDI). And so they acquired The Combined States’ concrete plant in Texas. It was the start to pay attention to cross-border activities. And they have given many benefits to these people. The one in the reasons was avoiding visitors barriers. On the other side, CEMEX plus the other global competitors happen to be handling concrete which is bulky and hefty. So one of the big concerns is usually transportation expense.

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If they export the concrete, they should pay enormous transport costs.

And it in addition should be linked to cost which is paid by simply customer. Therefore , they will drop their price competitiveness or perhaps margin by reducing the cost. So reducing the travel costs is a one of the reasons to perform FDI. That they could also save the time to deliver by putting your plants in each country. Especially in circumstance of the CEMEX, they’re even using satellites to website link dispatchers, truckers, and customers in a program so that utilizing delivery program. So that they guarantee delivery within 20 minutes too. This is also the key reason why they do FDI. And a different one, Cement market is very delicate to GDP growth, rates of interest, and other macroeconomic factors, and etcetera. They’re not only focusing on their home region, but as well doing FDI to reduce the potential risks by variation to receive stable revenues as well. The past one is that cement crops have to be shut down to areas where there is limestone. And it is difficult to find suitable place for limestone and create plants particularly in foreign country by Greenfield investment which is everything fresh. So it is better to find that place by obtaining cement crops.

And it also gives benefits on distribution funnel which is already organized by formers. What recommendations do you make to CEMEX regarding its the positive effect strategy in the years ahead? In particular, what types of countries should it focus its future expansion about? CEMEX features expanded a cement business to the Usa, Spain, Latin America, and other regions inside the text. Additionally, they had the eyes in China, India, and Brazil. The FDI strategy should certainly be good intended for CEMEX as a result of cement’s specialized that we have already told before. And in addition they have acquired RMC which is located on the Uk and third largest cement industry in Europe in 2005, and Rinker group located on Down under which is getting sales of 80% on the United States so far from for the internet. CEMEX has trustworthy concepts about expansion procedures. Most remarkable thing is actually a country required a large population and high population growth.

Even without that concept, China, India, and Brazil are meant to be tremendous market too and so will our team. Nonetheless they Haven’t invested yet and so they have combined English organization. So we now have suspected that it’s supposed to be big concern that language challenges about Chinese and Of india. Mexico people use The spanish language and CEMEX may also work with English internationally. And they are yet to merged a large number of company dependant on Spanish and English speaking country. All of us don’t know regarding inner thought of CEMEX, yet it’s meant that they’re centering the language as much as population and population development as the text says, and they are not centering political hazards because they are yet to already invested many countries that have political risks including Mexico. And so in these ideas, our team conclusion is that CEMEX’s key target is definitely the company relying on English and Spanish speaking country looking at population too. The specific region is Brazil. Brazil has recently mentioned inside the text.

That country’s inhabitants is nearly 191 millions. Although Brazil’s mother tongue is community Portugal, various people analyze Spanish and English nowadays. But it’s too enough. If they have already satisfied with joining that varieties of company which can be mentioned before, they should focus Cina and India market another. They should hire Chinese and Indian people who can speak English to obtain the Chinese suppliers and India market. Which could solve the chinese language problem. And they’ve already had a company located in Sydney. There’re various Chinese and Indian who can speak English very well in Australia because Down under is famous for multiracial country. By doing it, they can afford to get into Chinese and Indian marketplace. Of course they must consider various other concerns.

Plus the other place is Middle section East that numerous Korean building companies have previously participated in. There possess much political risks although take place several wars yet demands intended for construction is very high. Dubai and United Arab Emirates for instance. Therefore the last suggestion of us is usually Middle East.

2 . What accounts for the sequence through which CEMEX came into foreign marketplaces? How do the financial markets CEMEX came into more recently compare with the markets that entered at the beginning?

3. What recommendations will you make to CEMEX relating to its the positive effect strategy in the years ahead? In particular, what kind of countries ought it to focus its future expansion on and why? CEMEX expansion is a process in which the company performs its due diligence and the aim of expanding in a country using a large inhabitants and large population expansion. I thought CEMEX should always focus on Hard anodized cookware and The african continent market. Those two areas can help CEMEX turn into stronger than before. Expecially three countries: CHINESE SUPPLIERS, INDIA and brazil