vestel elektronik sanayi ve ticaret ( strategic business report.ppt )

Vestel Elektronik Sanayi VeTicaret A.Ş.

Presented By : Emmanuel AmakoHatice Gürkaş

Table Of Content1. Industry Analysis

I. Brief Overview Of The White Goods and Electronic Industry In Turkey

II. Main Competitors

2. Company Analysis

I. A Quick Look At Vestel

II. Shareholding Structure

III. Misson and Vision

IV. Growth Strategy In The Main Fields Of Operations

3. Operation ExpansionI. Local Market

II. International Market

III. Mergers and Acquisition

4. Porters 5 Forces

5. Financial PositionI. Financial Highlights

II. Balance Sheet

6. Core Competence and Competitive Advantage

7. S.W.O.T Analysis

Vestel A.Ş Strategic Business Analysis Report

A Brief Overview of the White Goods & Electronics Industry in Turkey

White Goods

Large scale Turkish and foreign manufacturers : Arçelik , Vestel, BSH, Indesit, Vaillant, BDR Thermea

50 medium sized manufacturers, 500 parts & components manufacturers, 12,000 dealers, 1500 technical services, 120,000 employees

Largest production capacity in Europe: 25 mn units

Exports: USD 3.3 bn in 2013

Imports: USD 1.1 bn in 2013


Electronics

2033 manufacturers

USD 12.5 bn sales in produced goods and USD 18 bn in engineering and service

Exports : USD 6.8 bn

Imports: USD 16.1 bn (main sources: Far East, EU)

Turkish manufacturers have 50% share in the CRT TV market in Europe

50,000 employees in production and 100,000 employess in related engineering and services

USD 250 mn in R&D expenditures


Main Companies

Rank Company Net Sales(TR , MN)

Number of Employees

Share of Foreign Capital

1 Arçelik 8,842 15,832 0%

2 Vestel Elektronik 3,418 5,222 74.69%

3 BSH Ev Aletleri 3,497 5,878 99.28%

4 Vestel Beyaz Eşya 2,164 5,830 0%

5 Vestel Dijital 845 917 0%

6 Indesit Co. Beyaz Eşya 875 1,088 100%

7 BOSCH Termotektnik 573 - 100%

8 Turk Demir Dokum (Vaillant) 570 1,071 96.19%

9 Baymak Makina (BDR Thermea) 243 409 3%

10 Kumtel Dayanıklı Tüketim Mallari 331 318 0%


A Quick Look at Vestel

1984WhiteGood

Zorlu Holding

Manisa TV Producer

Electronics


Shareholding Structure

81%

17%2%

Shareholding Structure of Vestel

Zorlu Holding A.Ş.

Zorlu Holding A.Ş.(publicly held)

Other Shareholders(publicly held)


Mission and Vision Mission

‘’As the technology giant of Turkey in durable consumer goods sector, we carry out our activities with a mission of making the “highest quality” accessible to our customers and being a leader in the sector we operate in.’’

Vision‘’ We continuously invest in research and development to strengthen our outstanding position in the market. In this regard, we will carry our current determination to the future.’’


Growth Strategy in the Main Fields of Operations

Vestel’s future growth strategy in its main fields of operationsconsists of four components:

• Improving market diversification

• Increasing customer and product

diversity

• Brand-centered growth

• Gaining market share in

new areas of use


OPERATIONS EXPANSION(In the Local Market)


International Market


MERGERS AND ACQUSITION


Porter’s 5 Forces

Threat of new entry

• High capital requirement

• Already congested market

Supplier Power

• A large supplier base

• Less supplier power

Buyers Power

• Power of buyers are less

Threat of substitution

• A vast option of available alternatives

Competitive rivalry

• Many competitors

• Tight competition


Financial Position


(US$mn) 2013 2012

Net Sales 3,270 3,921

Exports / Sales 73% 75%

Operating Profit 90 (52)

EBITDA 215 49

Net Loss (52) (62)

Total Assets 2,641 2,758

Shareholder’s Equity 630 753

Net Debt 304 372

1. Financial Highlight

2. Balance Sheet

0

1

2

3

4

5

6

2010 20112012

2013

Total Assets

Total Liabilities


• Quick Ratio : 0.59 • Current Ratio : 0.97 • Debt to Equity : 41.39%

3. Income Statement

-0.5

0.5

1.5

2.5

3.5

4.5

5.5

6.5

7.5

2010 2011 2012 2013

Total Revnue

Net Income


• Gross margin : 20.22% • Operating margin: 4.99% • Net Profit margin : 1.03% • Return on Investment :

4.08%

Vestel's Core Competencies and Competitive Advantages

CORE

COMPETENCE

A network that embraces

the globe

Economies of scale

The customs duty

advantage

Product diversification

strategy


Cont’d

Core Competence

Comprehensive logistical services and product

flexibility

An externally oriented business model

A strong brand and a

strong market position


Strength and Weakness (S.W.O.T Analysis)


Strengths

1. A key strength of Vestel is its bold , innovative and strong Management team.

2. Vestel serves as a new and a safe alternative to customer’s unsatisfied With the services of Vestel's competitors.

3. Vestel has been exporting more than its competitors which give them an edge in the international market and also improves it brand name in the local market.

4. Political, Economic and financial barriers of entry into the market can also be categorized as a strength of Vestel since these barriers makes it difficult for new firms to enter the market and hence less competitor’s for Vestel to compete with


Weakness

1. Production of white goods may not be of the best quality as compared to other electronic goods like the Vestel TV

2. It’s low customer services as compared to it’s competitors

3. The competitive nature of the it’s market4. The possibility of high interest rates on loans


Opportunities

• The ever growing Turkish population offers a huge oppurtunity to diverse and enter other lucrative sectors of the economy

• Vestel has the tendecy to offers its European customers high quality but low priced electronics as compared to it's European counterparts

• New generations of quality products that keeps the customers demand alive

• Labor costs are lower as compared with their European counterparts


Threats

1. The purchase of white goods are dependent on economic conditions and on customer's income and this can pose a threat to Vestel

2. Government support in Manufacturing , Sales and Exports are on a low level

3. High direct and indirect taxes4. Severe competition that happens as a result of playing with the price of a

product can pose a threat to the company
