Koc Holding Case Study Essay

Words: 937
Pages: 4

Koc Holding: Arcelik White Goods

Prepared by: Alex Sagastume


Which Countries are involved in this case? Describe the diplomatic relations between those countries? Are there any trade agreements, policies, sanctions, political circumstances, or diplomatic issues which would impact management’s decision to enter the market?
There are several countries involved in this case; specifically Turkey, Germany, France, and the UK are all countries in which products under the Arcelik, or Beko brand are being sold. Turkey, being a secular country established in 1923, has the advantage of being very neutral and so there is no trade tension between any of the countries it does business with.
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Arcelik prided itself with lean management with only four levels of management, as well as its top managers were very educated most of had attended business schools in North America or Europe. Koc has always had an eye for the future and growth, its evident in the letter that he left for his grandsons, challenging the third generation to grow socially and globally.
Why has Arcelik succeded in Turkey?
A major reason that Arcelik has done so well selling its white goods in Turkey, is that there is such a high-unmet demand for it within the country. With 99% of households in Turkey owning a refrigerator and imports only servicing 3% of the populations demand for white goods the Market was wide open for domestic competition. With the recession hitting in 1994, imports were drastically cut down, and it was Arcelik who had the reputation and brand recognition when the demand reached an all time high. By being an OEM company, Arcelik was able to manfacture their products at better quality standards and yet at still low prices. Theis reputation among older generations was reinforced in the younger demand, through heavy advertising and marketing.
Why is Bosch entering the Turkish Market? Is Bosch’s entry a threat?
Bosch was Arcelik’s primary competitor, and they certainly were a threat, however the threat was not that great. After Peg Profilo had been bought by Bosch-Siemens