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American Connector Company Essay

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Below is an essay on "American Connector Company" from Anti Essays, your source for research papers, essays, and term paper examples.

American Connector Company
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INTRODUCTION:

American Connector Corporation makes electrical connectors at a plant in Sunnyvale, California. With applications from military, aerospace to consumer electronics and appliances, there is great difference in terms of specifications also.   Standard designs were established by International Institute of Connectors and Interconnect Technology, the National Electronics Distributors Association or by the end user. There is rumor of entry of DJC Corporation of Japan which was a dominant supplier of electrical connectors in Japan. DJC had not established itself in the US as it had no plants in the US and but a small sales force. This created problem for ACC who also had problems of their own with regard to Sunnyvale plant where costs were increasing and quality of production was decreasing.
Threat of DJC to American Connector Company
Due to the operational excellence that DJC has, ACC should be extremely concerned with their entrance to the US. DJC will be willing to operate at smaller margins to capture the market share. The intensity of the market competitiveness can result in compounding of the threat of the lower prices.   ACC will have a limited amount of time for the realization of this threat and to evaluate the next course of action.   Main threat to ACC from DJC comes from the operational efficiency and static cost difference and hence disregarding the arrival of unnerving competitor like DJC can immediately disrupt ACC’s pricing strategy and long term profitability.
Following factors reinforces the threat of DJC to ACC-
  (1) Lower Material products cost – Following table shows that cost incurred by DJC as compared to ACC is lower in both the years 1986 and 1991. In 1986, DJC had 7% more COGS incurred as compared to ACC while at the end 1991, they were reduced by 40%. If DJC sets up manufacturing base in US Landscape, there will be substantial raw material cost...

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American Connector Company. Anti Essays. Retrieved December 18, 2018, from the World Wide Web: http://parimatchstavki7.com/free-essays/American-Connector-Company-634132.html