The Case Study of Vertical Integration Business Model On Taiwanese Small Appliance Manufacturer

• Main Authors: Chin-Kok Lim, 林振國
• Other Authors: CHANG-YUNG LIU
• Format: Others
• Language: zh-TW
• Published: 2005
• Online Access: http://ndltd.ncl.edu.tw/handle/66411450879786357479

碩士 === 國立中山大學 === 高階經營碩士班 === 93 === For a company to strengthen competitive advantage, they had to put in whatever method they can from time to time, for example, from product innovation, strategic innovation to seek for differentiation. There is also no exceptional for Taiwanese manufacturer. Due to the fact that most Taiwanese manufacturers are small and medium scales company, in addition they are OEM supplier, therefore at initial stage, it is very difficult to pursue differentiation from marketing and product research and development innovation. Under limited resources situation, how to aims at their own strength to select the strategy for differentiation is an issue for Taiwanese manufacturer to consider very thoroughly. This article took small electrical appliances industry as an example and from the business model application standpoint, we discovered that most Taiwanese manufacturers has taken Tapered vertical integration as the main business model to sustain its competitive advantage. Especially when they started on mainland investment, due to the land obtains easily and the cheaper labor force...etc, this vertical integration model application can further be implemented. Taking Value Chain theory and the Smile Curve as a basis for this study, and obtains the most effective vertical integration model is focus on "The Production Vertical Integration". This business model has led a few manufacturers obtain cost advantage in different level. As a case study we take Tsann Kuen Enterprise Co., Ltd as an example, to learn how this company has taken this vertical integration as an approach and developed to become the first Taiwanese manufacturer listed in China stock market. In addition, to learn how it became the top three of the largest small electrical appliances supplier. Finally, from the case study, we will propose a future development approach and suggestion for the Taiwanese small electrical appliances industry. Key Word: Vertical Integration, Smile Curve, Value Chain