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Motivation of Orion

Orion operated foreign direct investment for four main reasons: the declining Korean market, the collapse of communism opening new markets, globalization reducing trade barriers, and confidence in their Choco-pie product. Orion launched Choco-pie in China in the 1990s under the name "haoriyuyou" and had begun exporting to the Middle East in the 1970s. They decided to directly export to Russia where private importers had already introduced Choco-pie. Orion set out to expand their markets in Southeast Asia, Russia, and China through TV commercials and billboards. They established local offices and manufacturing facilities to closely analyze markets, including facilities in Hebei, China and Moscow, Russia to produce Choco-pie locally

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43 views

Motivation of Orion

Orion operated foreign direct investment for four main reasons: the declining Korean market, the collapse of communism opening new markets, globalization reducing trade barriers, and confidence in their Choco-pie product. Orion launched Choco-pie in China in the 1990s under the name "haoriyuyou" and had begun exporting to the Middle East in the 1970s. They decided to directly export to Russia where private importers had already introduced Choco-pie. Orion set out to expand their markets in Southeast Asia, Russia, and China through TV commercials and billboards. They established local offices and manufacturing facilities to closely analyze markets, including facilities in Hebei, China and Moscow, Russia to produce Choco-pie locally

Uploaded by

TedTaewooLim
Copyright
© Attribution Non-Commercial (BY-NC)
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as DOCX, PDF, TXT or read online on Scribd
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1.

Motivation of Orions FDI


There are 4 main reasons why Orion operated FDI. First one is Not promising Korean market. Korea was suffering from financial depression when Orion decided to operate FDI. Decreasing young consumers and expand of fast food made bakery company lose their market. Choco-pie faced mature step of its development. They operated marketing strategy to expand domestic market but it failed. Second reason is collapse of communism. After collapse of communism, many countries involving Russia, China and Vietnam became a new market. Third reason is globalization. Trading wall is collapsing at that time by WTO. Regulation was also decreasing. Last one is their confidence of their product. Orion tried to become a main stream of world bakery market. And they thought their Choco-pie can be the world standard.

2. Story about their FDI.


Choco-pie launched in China with name haoriyuyou() which means good friend at the beginning of 90s. Orions exporting has began at the middle of 70s while they selling gums to Middle East. Middle Eastern market was their most popular market. But Middle East has its limitation of variety of product. So they decided to export to Russia by themselves. At that time Russian private importer already boomed Choco-pie in Russia. Orion set their strategy to expand their market to South East Asia, Russia, China. They launched TVCF in Moscow at 1994 and they set up huge billboard on Tiananmen(Heavenly gate) China at 1995.

Localization plan Orion built local office and manufacturing facility on their market. After building Tokyo office in 1990, Beijing office in 1993 to analyze local market more closely. They build manufacturing facility in Hebei for Choco-pie in 1995 and established local company. They also established Shanghai office and Moscow office in 1996, Hochiminh office in 1997. Orion have their own manufacturing facility in Hebei, Shanghai right now. Orion wanted to make synergy from those two facilities by sharing product, raw material, technology, human resources.

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