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nternational Companies of Argentina

nternational Companies of Argentina

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International Companies of Argentina
International Companies of Argentina

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5,Analysis part not proper as per Porter’s Theory

INSTITUTE OF EDUCATIONAL EDUCATION AND RESEACH

TRIM -3 2011-2013 “INTERNATIONAL BUSINESS ENVIORNMENT”

Assignment -1

“Porter Model Analysis of International Companies of Argentina”

It is constituted as a federation of 23 provinces and an autonomous city. Buenos Aires. after Brazil and Mexico. COUNTRY SNAPSHOT . it was among the top ten richest countries of the world in the early twentieth century. It is the eighth-largest country in the world by land area and the largest among Spanish-speaking nations. It is now in the process of reconfiguring its market and mindset to become a prosperous country again. In fact. Argentina's continental area is between the Andes mountain range in the west and the Atlantic Ocean in the east. It has the potential to be one of the richest countries in the region as well as in the world. is the second largest country in South America by land area. It borders Paraguay and Bolivia to the north. and Chile to the west and south Argentina is the third largest market in Latin America with a GDP of 338 billion dollars. after Brazil. Brazil and Uruguay to the northeast.ARGENTINA Argentina officially the Argentine Republic .

inhabitants): highest in Latin America. 2 nd in Latin America.6 years) in Latin America. ranking fourth among developing countries.  Argentina the Latin American country with the highest number of Nobel prizes in sciences (three). 8th largest country in terms of surface area.  High level of Human Development (HDI – UNDP): 2nd place in Latin America expectancy (15.  One of the highest rates of literacy (98 %) and school-life  English level among the highest in the developing world.  Density of fixed and mobile lines (152 subscriptions per 100 INTRODUCTION OF ARGENTINA .

Many Multinational Corporations including MTV use Argentina as the centre of creative work and production for the Spanish. Constitution: 1853. IBM and other IT companies have established off-shore centres of software development. Argentina has the most sophisticated and beautiful country clubs and golf and ski resorts in the region. There are no ethnic. Suffrage: Compulsory for adults aged 18-70. restaurants and bars . BPOs and KPOs. There is a strong base of expertise in science and technology including in IT and nuclear energy.speaking world. Buenos Aires city was built like the Paris of Latin America with elegant parks. public buildings. cafes. after Brazil and Mexico. revised 1994. theatres. numerous smaller national and provincial parties. The Indian companies operating in Argentina employing 1500 Argentines are impressed and happy with the quality of human resources and the range and depth of the Argentine skill sets. PJ). religious strifes. Radical Civic Union (UCR). Judicial-Supreme Court. Argentina is the third largest market in Latin America with a GDP of 386 billion dollars. Political parties: Peronist (Justicialist. It has the potential to be one of the richest countries in the region as well as in the world. In fact. It had the earliest railroads. . 257-member Chamber of Deputies). Independence: 1816. metro and industrial development. Administrative subdivisions: 23 provinces and one autonomous district (Federal Capital). elegant and stylish city of Latin America.A rgentina has a population of 40 million which is a homogeneous stock of European origin – mainly from Spain and Italy. The literacy rate is 97 per cent and the human resources have a range of good quality skills. it was among the top ten richest countries of the world in the early twentieth century Argentina was one of the most developed countries in the beginning of the twentieth century. linguistic. federal and provincial trial courts. Government Type: Republic.speaking a single language and belonging to one faith (Catholic). Even now Buenos Aires stands out as the most well organized. apartment blocks. Branches: Executive--(72-member Senate. optional for those over 70.

Its other agricultural products include oilseeds. and Australia. Food Processing . Argentina is the world's largest source of tannin and linseed oil. Livestock (cattle and sheep) and grains have long been the bulwark of its wealth. flax. since the 1930s there has been a great rise in production in other areas. Argentina rivals the United States. especially in the oases of the Monte and the irrigated valleys of N Patagonia. The Pampa is the nation's chief agricultural area. As an exporter of wheat. MAJOR INDUSTRIES ARE:1. beef. soybeans. but the industrial and service sectors have also grown in importance in recent years. its cattle herds are among the world's finest. and tobacco. lemons. Agriculture Industry 2.Selected Economies: GDP growth 2003-2011 Argentina Industries????? A rgentina's economy has traditionally been based on agriculture. grapes. corn. hides. oats. and wool. however. Canada. mutton.

Agribusiness is the mainstay of the economy and exports. which. Most of the farms are managed by professionals who have studied agronomy. the vast fertile plains. There are abundant water resources. Argentina has a large area -almost equal to that of India. Mining Idustries AGRICULTURE INDUSTRIES (AGRICULTURE GROWTH) A rgentina is an agricultural power. led to banning animal proteins as cattle food. large-scale and globally competitive. They are supported by an excellent network of research and development laboratories. They can easily double the area of cultivation and volume of production.3. These events determined the fact that the European Union became a major importer of soybean and by-products. While in USA and EU. Argentina has a large area -almost equal to that of India. Most of the farming is done in a commercial scale by large landowners holding thousands of hectares. Argentina is the fifth largest producer of wine in the world. It is the world’s largest exporter of soy oil and sunflower oil. Argentina is the second largest producer of agricultural commodities and livestock after USA.with a variety of fertile soils and climates. It is modern. the Argentine government imposes an export tax of over 30 per cent for some commodities and still the exports arecompetitive. The climate is congenial without extremes. soyabeans and biodiesel and fourth largest of wheat. It produces 100 million tons of food products and exports more than 50 million tons. Chemical And Petrochemical 6. The famous Pampa region of Argentina . third largest producer of beef . It is a large exporter of wheat. Manufacturing Industries 5. as well as maize processing . agro-exports are subsidized. is one of the most productive regions in the world. THE SOYBEAN AGRIBUSINESS SYSTEM IN ARGENTINA: Soybean and sub-products demand has also been promoted by events concerning European Union public health measures (due to BSE outbreak). There are abundant water resources. soya and meat.with variety of fertile soils and climates. Natural reserves 4. the second largest exporter of corn. especially of protein flours. Argentina is using at present only 34 million hectares for agriculture. It ranges from the warm northern parts to the cold Patagonia in the south lending itself for growing different crops. since 2003.

industry product Argentina has become a leading player on a global scale in soybean production (3rd place following the U. the oil crushing capacity of Argentina is the third highest in . For example.S. logistics and network for transportation and shipping. Argentina FOOD PROCESSING Argentina has developed an efficient infrastructure.  Futvent Sa  Argensoja Sa Argentina  Argensoja Sa Argentina  Globaltrade Import-Export Argentina Argentina  Valor Natural Ltd. The food processing industries of Argentina are one of the most advanced in the world and globaly competitive. as well as in its processing. occupying the first place in soy flour and oil exportation. The river ports around Rosario connect to the grain silos and agro processing plants. Active policies on biofuels development that other countries are promoting also boosted Argentine soy oil demand. and Brazil). Companies are….

the great frigoríficos.and copper-smelting plants. and dairy industry NATURAL RESERVES Argentina is self-sufficient in energy and a net exporter of oil and gas. Beginning in the last part of the 19th century. The commercialization of agribusiness is done by well established Commodity Exchanges specializing in cereals and other agroproducts in Buenos Aires and Rosario. Santa Fe.even ahead of Brazil. In recent times. were founded to prepare beef for export to Europe. It produces 800. the Argentine government has entered directly into the meat-processing enterprises. flour mills.000 bpd is exported. with zinc. which for many years were under Thus it is evident that Argentina is well-placed to become a global agricultural power in the coming decades in which food shortage is going to be one of the main concerns of the world.the world. . It has two billion barrels of reserves. or meat-packing plants.with the latest technology and plants.000 billion per day of crude oil of which 300. Packing and processing of foodstuffs is the oldest and most important industry in Argentina. Off-shore exploration has only now been started and the land area is under-explored.

It is strong in food processing. Gas and Oil are important resources being increasingly exported to the neighboring countries and to the world market. tractor and meat-packing plants. refinery. Construction. consumer durables. The Future of Argentina Oil and Gas Industry to 2020. Argentina is a pioneer in the world in the development and use of CNG technology. and steel. clothing. The plants are close to both the many raw materials imported by ship and the vast productive area of the pampas. auto parts. covering the entire value chain of the industry. The mineral resources have not yet been fully explored yet. silver. metallurgy. CNG technology. zinc. machine tools. metallic and nonmetallic mineral products. electrical machinery and appliances. automobiles. copper. The major industries in Buenos Aires are food processing. Argentina's other principal industrial enterprises are heavily concentrated in and around the city of Buenos Aires. engineering. paper. Other industrial areas include Rosario. steel. and chemical and tanning industries . textiles. and space and nuclear products. MANUFACTURING INDUSTRIES The Argentine manufacturing industry is relatively large and diversified. aluminum. pharmaceutical products. pharmaceuticals and biotechnology. agriculture machinery. phosphate and iron. Together with mining products they make out for 15% of total exports. Some Argentine companies are globally competitive in pharmaceuticals. INDUSTRIAL INDUSTRIES Córdobais Argentina's major industrial center. It analyzes and forecasts each of the oil and gas segments in Argentina including upstream sector. cars. cranes. engineering and consultancy activities have developed to an important stage. biotechnology. pipeline. textiles. with important steel-producing plants and oil refineries. metallurgy. LNG and storage sectors Argentina has significant reserves of gold. chemicals and petrochemicals. Among Argentina’s manufacture goods are processed food.Argentina is the second largest gas producer (50 billion cubic metres) in Latin America and exports to Chile. especially for motor vehicle production. turbines. printing. hydroelectric power machinery and niche engineering fields. It is the center of metalworking. uranium. extending to the Latin-American market and other countries. wood products. chemicals and petrochemical products. motor vehicles.provide a comprehensive overview of the Argentina oil and gas sector.

COPPER. SILVER.A. ZINC. MINERA DE LA ALUMBRERA. It covers nearly all the domestic routes and has also an important continental . Viceroy and Camel. which consists in a subsidy plus easier access to credit in order to modernize the industry. The planted area was 831. which sells international brands such as Lucky Strike.294 tons of tobacco harvest. TRANSPORTATION The most widely-known national airline is Aerolineas Argentinas which has been operating for more than 60 years. as well as national ones like Jockey and Derby). (a subsidiary of Philip Morris International.A. THE MAIN EXPLOITATION OF COPPER AND GOLD.327 tons) was exported. and which in turn is associated with Tabaco’s Norte S. GOLD. only about 2% in the manufacturing of the derived products. The tobacco industry is dominated by two transnational companies: Messalina Particulars S. FET). most of which (93. and the rest in distribution and sales.MINING INDUSTRIES THE ANDEAN MOUNTAINS PROVIDE ARGENTINA WITH RICH MINERAL DEPOSITS. IS AN AUSTRALIAN VENTURE. The Argentine tobacco industry employs 500. AND URANIUM. about half of them directly involved in the planting and harvesting. which sells the Marlboro brand. the national government supports the producers by means of a Tobacco Special Fund (Fondo Especial del Tabaco. of which 776 were harvested. which are comparatively poor provinces. TIN. SOME OF THE MINERALS WHICH ARE BEING MINED AT PRESENT ARE. Tobacco plays an important role in the economy of the producing areas. IN THE PROVINCE OF CATAMARCA.) and Nobleza Piccardo (a subsidiary of British American Tobacco. TOBACCO INDUSTRIES The tobacco industry of Argentina produced 157.000 people.75 km². LEAD. despite the fact that the consequences of smoking are a major health issue in Argentina. Therefore.

New Zealand.semiproducts and components. Campana. with a short stopover in Auckland.and inter-continental network. with participation of the government. Cordoba. with 40% of them being the products of basic chemistry. Chemical enterprises and affiliates of the leading foreign companies are mainly concentrated in gas and oil producing provinces (Buenos-Aires. relatively extensive network of pipelines. Smaller oil refineries. Aerolineas Argentinas offers three direct flights a week between Sydney and Buenos Aires. 30% . Rio-Grande. a range of petrochemical centers (poles) to produce basic hydrocarbons. launching. 30% . Luján de Cuyo . with prevailing trend being primary distillation. Neuken). Campo-Duran. are located in extraction sites: San-Lorenzo. La-Plate.ready-made materials and finished products The country has favourable prerequisites to develop its chemical and petrochemical industry: availability of different kinds of chemical raw materials. Santa-Fe.5 mln. oil self-sufficiency and discovering of large natural gas deposits. There are also other private airlines that have been growing in recent years. tons in 2006. Chemical and Petrochemical Industry of Argentina Total annual production of chemical and petrochemical industry of Argentina is estimated at 5. Plaza Huincul.

Argentine companies have been exporting CNG conversion kits and technology to many countries. Wine exports have been increasing in recent years. reaching 1 bn dollars in 2010. Bunge-14 m tons. AGD-6. Total reserves are estimated to be 620 bn cu mts. silver. Cargill-18 million tons. Argentina exports Must and table grapes.5 m tons. Mineral .In a Nut Shell various industries of Argentina according to sector are Agribusiness Largest agro-commodity exporters are: 1. The horse population is 3. Malbec is the signature wine of Argentina. Argentina has the world's third largest shale gas reserves of 774 tcf Argentina is a pioneer and largest user of CNG technology. Molinos -5.3 million.5 m tons. uranium. copper and iron. Energy Repsol and Petrobras are the major oil producers. Dreyfus-9 m tons. Minerals Argentina has significant reserves of gold. Wine The total number of vineyards are 27000 and wineries 1500. zinc. 4. 3. Besides wine. Galileo. sixth in the world ahead of Spain. a leader in Argentina in CNG sector has supplied technology and equipment’s to India. The industry was earlier focussed on domestic consumption which is 40 litres per head per year. It is the second largest gas producer (50 bn cu mts) in Latin America. Argentina has an international reputation for thoroughbred and polo horses. It exports gas to Chile. 2.

exports are around 3. Borax Argentina S. Bagó. Ivax Argentina. PORTERS GENERIC STRATEGY M ichael Porter has described a category scheme consisting of three general types of strategies that are commonly used by businesses to achieve and maintain competitive advantage.C.. of which 17 are international laboratories and the rest are national. 6 Montpellier. 3. Aluminio Argentino S. There are 110 laboratories in the country. These three generic strategies are defined along two dimensions: strategic scope and strategic strength.I.6 billion Industries are:1. 3.A Pharmaceutical The Argentine pharmaceutical market is valued at 4. then an economist before he specialized in strategy) and looks at the size and composition of the market you intend to target. Market leaders are Bayer.7 billion dollars. (ALUAR). Strategic scope is a demand-side dimension (Michael E. 2. 4.Sanofi Aventis.A. Cementos Loma Negra C.Elea.A. Gador. The top ten pharma companies are : 1. 5. Bagó and Roemmers.4. Strategic strength is a supply-side dimension and looks at the strength or core competency of the firm. . In particular he identified two competencies that he felt were most important: product differentiation and product cost (efficiency).S.A. Roemmers. 5. Porter was originally an engineer.I. 2.

or an airline that turns around flights . This strategy involves the firm winning market share by appealing to cost-conscious or pricesensitive customers. In service industries. the firm must be able to operate at a lower cost than its rivals. medium. The first approach is achieving a high asset turnover. To succeed at offering the lowest price while still achieving profitability and a high return on investment. and scope of target market) as either low. This is achieved by having the lowest prices in the target market segment. or at least the lowest price to value ratio (price compared to what customers receive). relative product cost. or high. There are three main ways to achieve this. and juxtaposed them in a three dimensional matrix PORTERS DISTINGUISHES 3 SEGMENTS Cost Leadership Strategy 1.He originally ranked each of the three dimensions (level of differentiation. this may mean for example a restaurant that turns tables around very quickly.

These approaches mean fixed costs are spread over a larger number of units of the product or service. HLL. the firm hopes to take advantage of economies of scale and experience curve effects 2. and Mercedes-Benz automobiles. Segmentation Strategy In adopting a narrow focus. resulting in a lower unit cost. i. Perstorp BioProducts. In manufacturing. Asian Paints. the market is competitive or saturated. and the firm has unique resources and capabilities which enable it to satisfy these needs in ways that are difficult to copy 3.very fast. Examples of the successful use of a differentiation strategy are Hero Honda. The choice of offering low prices or differentiated products/services should depend on the needs of the selected segment and the resources and capabilities of the firm. A differentiation strategy is appropriate where the target customer segment is not price-sensitive. customers have very specific needs which are possibly under-served. Nike athletic shoes. Argentina Industries Based On Porter’s Model Argentina Industries based on Porter Stategy Narrow Market Scope Segmentation Strategy Pharmaceutical . These should be distinct groups with specialized needs.e. it will involve production of high volumes of output. Apple Computer. Differentiation Strategy Differentiate the products in some way in order to compete successfully. the company ideally focuses on a few target markets (also called a segmentation strategy or niche strategy).

Chemical and Petrochemical Plastic Industries Differentiation Strategy Broad Market Scope Wine Energy Minerals Reserves Agriculture Industries Natural reserves Banking Food Processing Manufacturing Industries Transportation Low Cost Competency Cost Leadership Uniqueness Competency Thanking You .

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