CASE BASED ASSIGNMENT

ON
LOGITECH
(MGN 301)

Submitted by-

Dinisha Bordoloi

Reg. No.- 11712435

Section- Q1712

Roll No.- B57

 CONTENT

TOPIC PAGE NO.

Case Analysis 1

Identification of the problem 2

Effective Solutions 3

References 4
 CASE ANALYSIS

Logitech company is the technological innovator in the computer peripherels,

founded in 1981 in Apples,Switzerland by two Italians and a Swiss. It is
headquartered in Fremont,California. It is basically known as one of the world’s
largest producer of computer mice and first to introduce infrared and wireless
mouse technology. It generates annual sales of over $3.32 billion.

Logitech’s strategic locations are:

United States of America (California)
Taiwan
China
Switzerland
The ergonomic design of Logitech’s product is done in Ireland.

In 1980’s it expanded its manufacturing unit in Taiwan because it wanted to win

OEM customers such as Apple Computer and IBM .Since Taiwan offered
solutions for a well developed supply base for parts,qualified people and a fast
growing local computer industry.The plant’s total capacity increased to 10 mn
mice per year after the Apple Contract and other OEM buinesses.
By the late 1990s it turned to China for more production capacity and a wide
variety of the company’s retail products .Wanda, a wireless infrared mouse is one
of Logitech’s largest sellers is assembled in Suzhou,China.Workers are paid $75 a
month whereas a Wang Yan mouse is sold to American consumers for about
$40.After distributing all the amount $3 goes for the Chinese factory to cover
wages,power,transport and other overhead costs.
Foreign companies like Logistics results in exploiting China to manufacture
products as stated by China’s Ministry of Commerce.

1
 PROBLEM IDENTIFICATION

 To minimize the transportation cost.

 Political Risk of govt. can quickly change business rules that can negatively
affect Logitech’s business.

2
 EFFECTIVE SOLUTIONS
 As transportation cost is higher it needs to find a strategic plan on where
they will locate their manufacturing plant to maximize their profit and
minimizing their shipping costs and to be able produce a higher quantity of
goods to capture a larger market computer peripheral producing companies.
For example: setting a manufacturing plant in Mexico.

 Promote more electronic or digital peripherels and increasing the number of

customer care service centres.

 Focused strategies on reducing dependencies on suppliers including retail

sales channel.

 Since there is rapid advancement in technology so the company needs to

upgrade its product according to market needs.

 Effective marketing strategies to increase sales.Marketing can be done

through more online presence since it lacks in it.

 Expand the manufacturing plant in China. The company will have a lower
cost of production due to low labor cost in China. Demand of products will
be met easily because of the expansion. Higher production volume. Though
expansion is costly, the return on investment of the new facilities will
increase the revenue. The expansion does not only focus on the production
capacity, but will also expand product line which is gaming products.

 Since political risk is uncertain and govt. can change its policies or rules and
inflation rate can go up/down resulting in negative impact in business.So, it
needs set up business where political scenario is stable and price of trading is
low .

 Expansion of business through innovating gaming products (such as mouse

for gamming, joysticks, keyboards).

 It must not exploit the market due to low labour cost and provide
employment opppurtunities to the people of that country.

3
 REFERENCES

International Business Book (6th edition)

www.logitech.com
https://en.wikipedia.org/wiki/Logitech