School Papers

Samsung in the top 10 Interbrand rankings, showing

Samsung is a Korean electronics company that is ranked number 6 in the “Best Global Brands 2017” ranks and the value of the brand is $56.2 billion, which is a 9% increase from last year. They operate in 79 different countries and with offices in six of the seven continents. Since 2012 to 2017 Samsung has stayed in the top 10 Interbrand rankings, showing that the brand is continuing to grow the brands value year-by-year becoming better and better as they improve. As you can see below Samsung has nearly a quarter of the global smartphone manufacturing ranks. This shows that Samsung is a well known and successful company as it is selling much more smartphones than most of the other companies also selling smartphones and Samsung is selling more than Apple, who are their main rivals and Samsung is ahead by 10.7% over Apple’s manufacturing rankings, which impressive as Apple is normally the most well known phone manufacturer and because of this you would think that their rankings should be higher than Samsung, but it isn’t because the graph is showing different results.This Graph is showing how Samsung has improved with the growth of its brand value year-by-year. Also in this information you can see that for three years they remained ranked 7 but the value of the brand was still increasing, however in 2015 the value of the brand decreased slightly but recovering significantly in 2016 by smashing their value of the brand and reached ranking 6.Even though the brand value went up, the brand rank still remained the same until the current year, were it increased to rank 6, overtaking another place.This is showing that Samsung is improving slowly but surely as the evidence and information show. Samsung also has not had their rank go from good to bad, it has always been going in a good direction by getting ranked better each time.But there are many different factors that samsung have to face as a company and for short it is called PESTLE which stands political, economic, social, technology, legal and environmental factors. Political factorsMost of the time political factors don’t impact the influence of progress a company like Samsung has. But if it does impact the business it is because the business or company can be directly impacted in the form of their trade relationships or regulations between countries. So if countries have good relationships, then the business will find it easy to do business in the other country. But if it is the opposite then may not have the right environment in the other country to make profit as the two countries have bitter trade. Samsung is spread over 80 countries, so if this happens to Samsung it could have bad consequences but if the countries have good relationships then like I said the business will have it easier to do business and make profit. Recently Samsung has face specific things that have impacted them like the state and the political instability, this means Samsung has faced political problems such as in its home country of South Korea as there is tensions with the country neighbouring them, who are North Korea, so they had to think about the political instability and also the threat of war breaking out in the Korean Peninsula. They also have to face more political problems from many Latin American and African as there are political pressures for them as the the environment is not stable and it is likely to constantly changing in the governing structures. One of Samsung’s problems are political factors like the Brexit effects as it has to have talks on moving its European headquarters based in London. The Brexit is a problem and an issue as it is creating inflation, which makes prices the of their products to continue to escalate due to the value of the pound becoming lower and weaker and it has already lowered by 18.5% than the US dollar and this problem will get worse and worse if Britain leave the EU before the year 2020. Rival companies like Apple has already made the prices higher in their UK App Store by nearly 25% and they have said that all the new Macs they are launching are going to be raised by 20%. The strengths of Samsung is that they have strong foreign relationships but the challenges that they might face are the military influence in South Korea politics and political violence. They also have to to think about the future issues that they might face like their uneasy relationship with North Korea.Also there was a problem in South Korea as Samsung was involved and had been caught in doing a political bribery scandal with president Park Geun-Hye who was also involved, which followed up to the resignation of Park Geun-Hye and the trial and arrest of Samsung’s heir-apparent and co-chairmen called Lee Jae-Yong and this gave Samsung a bad image, this made an impact as less people bought Samsung’s products, making them be less successful. Unfortunately this happened when Samsung had a problem with the Note 7 failing to work and these issues occurred when Samsung was facing serious competition across many of its main businesses.  EconomicThis is important to Samsung as well because there are economic crisis and has impacted the purchasing power of the consumers in several developed markets making Samsung find profitable ventures in the developing markets. The Koreans has faced bad difficulties like more household debts and are organising differently the shipbuilding and steel industries but Samsung still had sales of 200 trillion in South Korean Won and this is like £1 billion, despite the economic problems. But the more a state develops the more and higher chance of the company expanding and opening their newly made units in newly developed areas and zones. If a country has a good GDP then that means that the people living there have more income meaning that they will be more likely to buy the latest products and items made by the company. This means that the overall profit of the company will be increased and the company will always be in a position of expanding globally. Economic crisis the world is going against has direct impact to a company like Samsung and because of this uncertainty, it has made Samsung change their strategies every once in awhile. The strengths of the economic factor is that Samsung have got a powerful export sector and also they have successful economic reforms. But the challenges Samsung will have is having low level of imports and decreasing levels of foreign direct investments (FDIs). But for the future Samsung  has to think about the future prospects like competitive tax policies and future risks that they might face like nuclear crisis and growing local hatred for foreign companies. Samsung can face financial risks as there are foreign exchange risks, because the company can experience the currency gains and losses based on the diverse functional currency of each different country that Samsung works in. So to minimise foreign exchange risk that are forming from the operating activities, Samsung has a foreign exchange management policy that needs a usual business transaction that includes imports and exports and it will be managed in the local currency or for the cash-in currency to be the same as the cash-out currency, because of this it has lead to the decrease in purchasing power for customers in different nations. Samsung has moved to various different methods and solutions that can make them have profit as it is cheaper for them to afford to.SocialThe social factors are usually based on the local beliefs and culture of the people in which the company is working in. To succeed in this area the Samsung has to be flexible in their policies and go along with the local culture. Samsung is primarily a family owned multinational, which means that despite its global footprint  it still works as a Korean company. This means there are several things Samsung has to think about other aspects to its global operations like adapting to the local conditions. Therefore, Samsung had to tailor it products to the fast changing consumer preferences in the different markets where it works in. So Samsung works and operates in small, specialised markets that is strongly persuaded and influenced by the lifestyle preferences of the customers and they have had to change the focus or direction in each market accordingly. Alos according to Mintel, Samsung has a behavioural shift in the way customers are using their smartphones that are increasingly progressing making the tablets lose their value so the selling point decreases. If Samsung changes socio cultural trends they have a big chance of rising profits and a chance of losing profits. Samsung’s Galaxy series has been famous and popular for the people as the demand for a smartphone with a large screen and smartphone gadgets are high and these smartphones are very popular in Asian markets, this shows the social factors can both have direct and indirect impacts on Samsung and their profits.Samsung, after the company grew and developed massively, it also grew and developed internally as the conservative environment made way for freedom of speech, emphasis on quality of the employee’s life outside the working place and less meeting hours, making it much better for their employees. Samsung was a family owned South Korean businesses and like most family owned businesses it was normally expected for workers to put in long hours of work so that people could show respect and gratitude as the bosses were considered as fatherly figures and their colleagues were seen as family. The first few weeks were tough and hard for the worker as it was like working in a military boot camp and the employees were deprived of sleep and were made to maintain a specific exercise schedule to keep fit. But as South Korea started receiving education from abroad and this made them realising how important of the work-life balance so that they don’t over-work their employees to get the most out of their work. Technology Samsung can be recognised as being with the world’s leading and top innovative companies. This means that the company has an advantage on the technology and this is an ambition that Samsung wants and they make it is their mission to be ahead of the technological and a vision to be the dominant rivals and competitors by being the first to reach the market with its latest products. Their technology is so good that Apple has used Samsung’s help to create the screen for the latest Apple Iphone X. In contrast, because Samsung’s ambitions are to dominate their rivals and competitors, Samsung has been resulted in the company cutting corners with its imitation of the Apple products design and this has brought trouble for Samsung. But in the past few years Samsung has shown its capabilities with the wireless charging, beating their main rivals Apple in terms of more features, adaptability and versatility in their smartphones. This is why rivals Apple have brought wireless charging for their new smartphone called the Iphone X. Apart from this Samsung has a variety of products that range from refrigerators to smartphones and when they joined together and collaborated with Russia to provide cheap scientific information and research. However, because of this Russian Scientist not only helped Samsung with the image processing chips, they also helped other features.    Legal For a globally known company like Samsung, which have many rivals especially Apple. So Samsung has to be careful about legal issues like copying and other pirated issues. In many times Apple has blamed Samsung for copying their designs and features. Samsung has faced bad penalties for the copying of Apple’s Iphone, Ipad and this made the company take a hard hit as the public have seen what they have done, this makes them think that they are copying Apple because they are good so more people started to go to Apple. Samsung and Apple are stilled involved in a competitive war with each other since 2011, when Apple took Samsung to court for copying their designs. By 2012, Apple and Samsung were taken to 50 ongoing lawsuits in more than ten countries that had billions of dollars of damages claimed between them as they are two rivaling businesses, they were both trying to go at eachothers throats. The cases Apple won where in countries like the U.S, Germany and Australia. On the other hand, Samsung won the rulings and cases in South Korea, Japan and the UK and by the year 2016 Samsung finally won the appeal in the U.S supreme court to a decision to award nearly $400 million to Apple.EnvironmentWith the fast rising of globalisation, people have to be more ethical and the consumers will always expect their favourite brand or company to be socially responsible. The working conditions must also be good otherwise people won’t want to work for the company and it will give the company a bad reputation. This means that Samsung has to make sure that they don’t compromise on the working conditions or even the wages Samsung pays to its labour who have the role of making the final product. Also the external and internal factors are also major ingredients for the success of Samsung. After the Galaxy Note failure, Greenpeace has been on Samsung’s case for failing to give details on how it will dispose the millions of Note 7 smartphones, because if the Samsung decide to choose to dump them, it would make an equivalent of roughly 28 shipping containers of toxic waste. According to the environmental group say that there are 4.3 million Galaxy Note 7 phones produced, which is bad as there will be more toxic waste produced.      

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