SAMSUNG

PREPARED BY:
NO. NAME MATRIX NO.
1. NUR HAZWANI BINTI ANUAR 2021882034
2. NUR NAZATUL AKMA BINTI ROSLEE 2021880872
3. NURAISYAH FAZURA BALQIS BINTI YUSRI 2021884258
4. NUR ARIQAH SOFIA BINTI MOHD YUSAINI 2021897418

ECO 162
MICROECONOMICS
GROUP: RAC1201F

OCTOBER 2021 – FEBRUARY 2022

PREPARED FOR:
SHALIZA AZREEN MOHD ZULKIFLI

SUBMISSION DATE:
29th January 2022

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 DECLARATION OF ORIGINILATY FORM
Hereby declare that
• This assignment is of my original work and I have acknowledged any use of
the Published or unpublished works of other people.

• I did not copy other person’s work and I understand the implication of
plagiarism.

NO. NAME IC NUMBER

1. NUR HAZWANI BINTI ANUAR 030806070372
2. NUR NAZATUL AKMA BINTI ROSLEE 030319021020
3. NURAISYAH FAZURA BALQIS BINTI YUSRI 030114060026
4. NUR ARIQAH SOFIA BINTI MOHD YUSAINI 030217070438

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 ACKNOWLEDGEMENT

First of all, we are very grateful that we were able to complete our Microeconomic
Engagement Report (ECO162) within the deadline set by our speaker, Ms. Shaliza Azreen
Mohd Zulkifli. The mission is carried out diligently with our efforts. We spent the weekend
researching, gathering all the information, and discussing ideas. We would like to express
our special thanks to our professor of microeconomics, Ms.Shaliza Azreen for helping us
find and provide educational material and information relevant to our topic. He gave us a
lot of advice from the start of the mission to the process of making this report with this
current situation i.e., we cannot have face-to-face lessons during MCO. All of the teaching
materials you have provided us are very helpful in learning this course. We also thank you
for placing your trust in us to carry out this mission on time and for guiding us as well as
possible during this DOE, even in this Covid19 pandemic.

Secondly, as well as our group members who are doing their best and cooperation
to complete this title mission which also helped us to do a lot of research and we
learned so many new things that we are grateful for. We also thank our families,
friends, and colleagues for forgiving their support and willingness to take the time
to fill out questionnaires from time to time to complete this mission despite their
busy schedule with limited time during this ODE Without their support and
encouragement, this task may not have been completed. And let us not forget our
classmates and friends either, because they also help us in this task. With gratitude,
our deepest gratitude to them for helping us and always giving us their best ideas,
knowledge, and feedback on our mission so that we can improve and finish this
mission brilliantly.

We are overwhelmed in all humility and gratitude in acknowledging our depth to

all who have helped us to put these ideas, which allow us to undertake such great,
inspiring, and innovative work, far above the level of simplicity and in some way.
something concrete. Any attempt at any level cannot be satisfactorily completed
without the insightful support of the developmental process and the guidance of all
of you, our teacher, parents, families, friends, and colleagues for their
encouragement. greatly appreciated.

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 TABLE OF CONTENTS

NO. CONTENT PAGE

1. Chapter 1: Introduction 5-8
2. Chapter 2: : Discussion 9 - 10
3. Chapter 3: Recommendation 11
4. Chapter 4: Conclusion 12
5. Bibliography 13
6. Appendices 14

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 CHAPTER 1: INTRODUCTION
1. Type of Business

Electronics Business
Samsung Electronics Co., Ltd. is the parent company of the large Samsung group of South
Korea and the largest electronics manufacturer in Asia. Samsung Electronics operates 4 main
divisions as well as digital media, semiconductors, information and communications, and home
appliances. The employer sells televisions, video and audio equipment; computer systems and
related products; telephones, mobile telephones, and fax machines; Appliances;
semiconductors; products associated with the network; automation product production unit;
fibre optic products; closed circuit protection products; vehicles and compressors; and solar
electricity systems. In 2000, Samsung Electronics held the main market function within the
code department of a few access markets (CDMA), DRAM, SRAM, and colour detection.

2. Background of the Company

Samsung is a South Korean business enterprise at first based as a grocery keep with the aid of
using Lee ByungChull in March 1938. The business enterprise made its foray into the
electronics enterprise in 1969 and its first digital product become a black and white television.
Soon, the business enterprise additionally commenced exporting its merchandise and have
become a primary electronics producer in its domestic country. In 1970, the business enterprise
obtained a 50% stake in Korea Semiconductor.

Witnessing fast growth withinside the early 1980s, the business enterprise installed separate
subsidiaries for its diverse digital activities. It became at some stage in this time that the
business enterprise additionally invested in studies and improvement institutes that helped it
end up a marketplace chief in IT services. By the 1990s, the business enterprise had ended up
one of the pinnacle 5 electronics producers withinside the international and become
exceptionally regarded for its semiconductors, LCDs, and different generation merchandise.

Samsung made a foray into cellular telephones in 2000 with the release of a function
telecellsmartphone with an integrated digital digicam able to take on to twenty pictures at once.
By the give up of 2000, the business enterprise had released numerous telephones, however,
its international fulfilment tale commenced with the release of the Galaxy S collection of
smartphones which used the business enterprise's OLED display generation and Hummingbird
processor. In addition to smartphones, the business enterprise is likewise a main dealer of

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tablets, inclusive of the Samsung Galaxy Tab collection with Android generation, and is taken
into consideration by the author of the phablet class thru its Samsung Galaxy Note collection
devices.

Today, Samsung is one of the international's main producers of digital components. It is

likewise the main dealer of digital merchandise inclusive of batteries, semiconductors, chips,
flash memories, and tough drives for groups inclusive of Apple, Sony, Nokia, etc. Samsung
has additionally been the international's biggest maker of televisions because 2006 and
smartphones because 2011. In 2017, the business enterprise overtook Intel to additionally end
up the international's biggest semiconductor chipmaker.

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 • Vision

The term "inspire the world" means that a company's imagination and foresight isn't always
limited to creating products, however, it inspires the world, and this is done through the use of
gaze. on cultural diversity. Outreach allows Samsung to customize its products according to
the wishes of each group.

Samsung has already established the level of innovation and structure in its imaginative and
prescient statement. Its smartphones, laptops, and tablets use a modern layout language that no
longer caters to customers better, but more to the competition. However, they drive innovation
with the release of every new product.

• Mission
Samsung's mission is: “We will meet the needs of our human resources and our generation to
develop cutting-edge products and services to contribute to a larger international community.
The challenge for this company began in the 1990s when the trading company experienced a
major international boom in various semiconductors, digital and related. Focusing on its
commercial business sports and the predominant reputation of the multinational sector,
Samsung reveals the following additives for your company's mission:

➢ Human sources and technical sources

➢ Superiority of merchandise and services
➢ Improvement of a worldwide society

Samsung's mission is to become a huge commercial company that works with big companies
like Apple Inc. can compete. and Google LLC. Samsung's challenge set consists of key teams
facing the challenge, along with human resources and technology, to achieve the company's
goals. Additionally, Samsung needs organizations that maintain an aggressive payroll
improvement and humanitarian aid program. In addition, the focus is on product coherence and
commercial corporate management. This is because by making top-quality items, Samsung will
become a trading company that will make brilliant products in the world market.

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 3. Type of Products Produce
Samsung Electronics, the largest subsidiary, manufactures a wide variety of consumer
electronics products including TVs, tablets, smartwatches, digital headphones, home theatre
and audio, computers, laptops, monitors, printers, devices, storage, home appliances and
security/tracking systems, up to semiconductor parts and reminiscences.
Other major subsidiaries and their key products are as follows:
1) Samsung Heavy Industries
➢ Ships, in particular specialized ships for use in the oil and gas industry; wind
turbines

2) Samsung C&T
➢ Skyscrapers, civil engineering projects, residential complexes, garments.

3) Samsung SDI
➢ Industrial and consumer batteries, other ESS components (energy storage
systems) and components for LCD screens, OLED screens, and photovoltaic modules.

4) Samsung Display
➢ Screens for mobile devices, televisions and other products

5) Samsung Biologics
➢ Bio-healthcare products

6) Samsung Bioepis
➢ Biosimilars

7) Samsung Medison
➢ Ultrasound devices and other medical equipment
➢ Renault-Samsung
➢ Originally Samsung Motors but acquired by Samsung Group in 2000 by
Renault Group. However, the latter retains a minority stake of around 20 percent in
Renault Samsung and allows Renault to use the Samsung name under an agreement.

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 CHAPTER 2 : DISCUSSION

1. Market structure of Samsung

The market structure used by Samsung to operate its company is oligopoly. It is one of the most
profitable and largest companies in the world. One of the main components of this company can be
clearly seen on its mobile phone. In an oligopolistic competition, there are many companies
manufacturing smartphones in industries around the world. Key features of the oligopolistic market
structure that affect Samsung and other brands. For instances : -

 Few firms control the market

 High barriers to entry
 Interdependence

2. Characteristics of Samsung

High barriers to entry

There are also barriers to entry seen in Samsung’s oligopoly in the smartphone industry. Brand loyalty
is described as a major obstacle to entry. Brand loyalty plays an important role in oligopoly, so
companies wishing to enter the industry must ensure that they compete with other companies that are
already phased out of their products in the industry. Customers are responsible for choosing the desired
operating system according to their preferences. As Android among Samsung , Samsung was selected
as the top customer last year because of its remarkable sales on Android devices. For instance, Samsung
has approximately 579 suppliers, and its supply chain includes more than 2,700 suppliers worldwide in
various industries. Companies that supply common components and parts do not need bargaining power
because of Samsung's volume and bargaining power.

Interdependence

When a company is in an oligopolistic state, mutual dependencies appear. When a company changes
product specifications or prices, it has a serious impact on the sales of its competitors. Competitors also
make small moves to overcome the price impact. Because Samsung is an oligopoly. There has been
price competition between Samsung and Apple in the past. It’s all started when Apple offering retail
customers discounts on iPhone purchases. Apple has countered Samsung’s move by offering a 15%
refund on Samsung Galaxy product selections. It clearly shows the interdependence between the two
companies, as the price fluctuations of one company prompted the rival’s move, just as Samsung
opposed the rival’s move.

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 3. Issue faced by Samsung

High Price

Samsung products have always been expensive to maintain the high quality of the products.
Competitors such as Apple, Huawei and Xiaomi are trying to outperform each other by
improving quality and price range. Samsung should focus on balancing quality and finance so
that it can compete and survive in this huge competition. Samsung's Android operating system
has many flaws. They tried to bring more quality to Android, but it's still lacking in perfection.

Product Failings

Products that threaten the lives of consumers undermine trust in the company. Samsung has
released to consumers a variety of flawed articles, from the explosive Samsung Galaxy A20e
to broken clamshell mobile phones. Many Samsung Galaxy Note 7 series smartphones have
shown that overheating the battery can lead to an explosion. At the same time, it was reported
that some refrigerators and washing machines started to catch fire.

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 CHAPTER 3: RECOMMENDATION

Solution to overcome the issue

This is the solution to overcome issue faced by Samsung. First, when a product is new to the
market or has recently been launched, skimming pricing are utilized to sell it at a relatively
high price due to its novelty, client interests, other current fantastic elements. As a product
becomes more established in the market, the price gradually decreases, and the product is
eventually sold at a competitive price. As competition increases, skimming allows firms to alter
and update prices, allowing them to cut rates and attract more customers when compared to
other smartphones.

Second, by completing the certification method, Samsung secures materials of consistent

quality and supply capacity. Through a supplier self-checklist and a manufacturing site audit,
the approach is aimed to confirm product compliance, supply risk assessment, and production
capabilities. This ensures that the finished goods are of excellent quality and are safe for
consumers. The quality of the materials utilized in Samsung's products is extremely important
to the company.

Third, Samsung makes every effort to ensure that its products are of good and consistent
quality, and that they are delivered on time to ensure customer satisfaction. Samsung achieves
this goal by controlling variations in multiple processes in a consistent manner. A closed loop
methodology involving the selection of critical parameters, evaluation of the measurement
system, monitoring of critical parameters, process capability improvement, and reaction plan
is used to accomplish continuous improvement.

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 CHAPTER 4: CONCLUSION
Samsung is an electronics business. The company analysis reveals that by integrating with the
electronics sector, Samsung Electronics began manufacturing various types of products and division in
each category, among which as stated namely digital media, semiconductors, information and
communications, and home appliances. Including electrical devices, and telecommunications
equipment. Samsung has demonstrated a wide range of products manufactured for a variety of uses and
purposes, not only for human personal use and home appliances, but also including industry and
manufacturing.

With a strong vision and mission in the digital market, Samsung is not only committed to creating
quality products, but they also ensure the resulting impact of their products has a huge impact on the
world. They focus on becoming a large commercial company that can compete with more profitable
companies by re-reflecting customers’ needs to their products, the companies learn to forecast and react
to their customers and their environments in order to remain competitive. In an oligopolistic
competition, there are many companies manufacturing smartphones in industries around the world.
Samsung has shown these types of characteristics, namely high barriers to entry and interdependence.
Its products demonstrate price-elastic demand and strong income elasticity because it works in a totally
competitive environment. Apple, Huawei and Xiaomi are Samsung's most direct competitors.

Samsung uses four tactics in its target market: differentiated or segmented marketing, undifferentiated
marketing or mass marketing, concentrated marketing, also known as niche marketing, and
micromarketing. Depending on how long a company expects to operate and export its product in a
foreign country, as well as how simple it is for its product to enter and exit, Samsung should consider
the country's political risk and stability for a better outcome. A solid plan can begin with the choice that
provides the most flexibility and progress to more commitment once we have gained more knowledge
and confidence in specific markets. Whatever technique the corporation adopts, they must ensure that
their business is adequately safeguarded.

Samsung knows exactly how to handle and overcome when issues are faced by them. Without
disappointing customers and consumers, Samsung has provided competitive attention through mobile
features. So that many customers will devote to Samsung mobile phones and will continue to do
business with the company. Finally, the customer's decision to purchase a Samsung mobile phone is
based on the phone's appealing characteristics, making it a potent incentive.

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 BIBILIOGRAPHY

1) History of Samsung Electronics Co., Ltd.

https://www.business-standard.com/about/what-is-samsung

2) MGT162 Individual assignment

file:///C:/Users/USER/Downloads/Telegram%20Desktop/mgt162-individual-
assignment.pdf

3) What Does Samsung Make?

https://www.koreaexpose.com/samsung-products-basic-information/

4) Management of economics
https://www.scribd.com/embeds/506663714/content?start_page=1&view_mode=scroll&a
cce ss_key=key-fFexxf7r1bzEfWu3HKwf

5) Oligopoly market structure of Samsung

https://www.coursehero.com/file/67501082/Oligopoly-Market-Structure-of-
Samsungdocx/

6) Samsung Rising Sales

http://tbs2015microeconomics.blogspot.com/2012/10/samsung-rising-sales.html

7) Conclusion Samsung is the main brand for mobile

https://www.coursehero.com/file/p1pgkjn/Conclusion-Samsung-is-the-main-brand-for-
mobile-phones-with-its-high-end/

8) Samsung (Report)
https://www.slideshare.net/ashrafali191/samsung-report

9) Samsung Company Overview

https://www.123helpme.com/essay/Samsung-Company-Overview-382235

10) Samsung Company: Business and Economic’ Analysis

https://business-essay.com/samsung-company-business-and-economic-analysis/

11) Quality policy

https://www.samsung.com/semiconductor/support/quality-management/

12) Pricing strategy of Samsung

https://www.linkedin.com/pulse/pricing-strategy-samsung-asmita-gupta

13) Porter five forces analysis of Samsung

https://www.porteranalysis.com/porter-five-force-analysis-of-samsung-electronics/

14) Samsung SWOT Analysis

https://swotanalysis.website/samsung-swot-analysis/

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15)
APPENDICES

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