Case Study: Koc Holding: Arcelik White Goods
Memo Guiding Questions:
1. Why has Arçelik succeeded in Turkey?
Arcelik was established in 1955 to produce metal office furniture, but in 1959 the company change production and began to produce washing machine, vacuum cleaners, air conditioner etc. Arcelik are popular in European market and being sixth largest manufacture of household. That’s why Arcelik is one of the competiveness companies in Europe and top of production which exported. In 1980s Arcelik licensed technology from General electrics and Bosch- Siemens and became unique sellers in Turkey. After using licensed technologies Arcelik starts innovates their production. The result, they produce quality and low cost production, which increase demand of consumers in Turkey, EC and Asia. Arcelik have a complete and intensive retails network within Turkey. They sold their white goods under exclusive outlets which only sell Arcelik product. They also have special dealers to provide good after service to service the customer who encounter problem after purchasing Arcelik products.
2. Why is Bosch entering the Turkish market? Is the Bosch entry a threat to Arçelik?
Because the Turkish economic situation is well and the consumer purchasing power increase which make domestic demand of white goods strong Bosch gives licensed technology for Arcelik. In 1995 premium priced production of Bosch imported to Turkey, but penetration was limited. Bosch goal was to supplement the existing network of Peg Profilo dealers. After 1996, the import tariffs cut to zero which made Bosch can compete better in Turkish market. Arcelik Company expects that Profilo would be competitive in washing machine and dishwashing.
3. Why is Arçelik pursuing international markets? Does it make sense?
Because, their goal were to develop bid proposals on foreign government tenders and foreign contract builders of low income housing. And...