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Essay / Research Paper Abstract
This 3 page paper is based on a case supplied by the student. The answers given to address why the firm decided to internationalize and the reasons behind the subsequent failure are reviewed and assessed.
Page Count:
3 pages (~225 words per page)
File: TS14_TEfletcher2.rtf
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Unformatted sample text from the term paper:
existing assets and the way that they could be utilized and leveraged in an international environment. By making acquisitions there was this potential to increase the scope and the
scale if the operations. As Fletcher Challenge was the worlds second largest paper and pulp company it may be argued that the acquisitions that were made could also have been
undertaken in order to try and pursue a cost advantage in order to gain a sustainable competitive advantage. The firm dies not need to be the largest to pursue the
strategy, but size helps due to the potential benefit of the economies of scale. However, there are also diseconomies of scale that can be suffered, especially where a large firm
is highly diversified geographically. The acquisitions also need to be considered in terms of the resources that they brought to the company. Although Fletcher Challenge were able to gain
economies of scope and scale as a result of their ownership of the largest man made forest and the largest processing plant, these benefits are limited in terms of value
for the acquired firm. Growth by size would not necessary mean internationalization. The acquired firms also need to be considered in terms of the benefits that they brought to
Fletcher Challenge, apart from simply increasing capacity. There were opportunities presented by the changes in different countries with liberalization and the sale of government assets which had potential if they
were acquired by Fletcher Challenge, creating a pull factor on an opportunities based strategies. The consideration of the way that there were acquisitions made that would also help the firm
access markets is also important. To consider this in terms of the growth and size only is also to ignore another stated strategy. The case also states that one
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