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Lakewood Chopsticks Exports
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1. Is Lakewood Forest Products ready for exports? Using the export-readiness framework developed by the U.S. Department of Commerce and available through various sites such as www.tradeport.org (from “Trade Expert” go to “Getting Started” and finally to “Assess Your Export Readiness”), determine whether Lakewood’s commitment, resources, and product warrant the action they have undertaken. In 1970s, Bedas Canadian Ltd. had successfully experienced in selling lumber and salmon to countries in the Persian Gulf. The company had opened four offices worldwide at that time. However, the company encountered with the biggest problem in selling its products because of the explosion of the Iran-Iraq war in 1983. The price of lumber decreased rapidly in international market. Most of the trading companies also disappered within this situation. To solve this problem, the company sent its employees to the world market in order to find new markets and business opportunities. One year later, Lakewood Forest Products was established in order to supply lumber for Korean firm. While Korean firm purchased lumber for manufacturing chopsticks, the company found that chopsticks was interesting market in Asia. Particularly, the Japanese chopsticks market was one of the highest growth rate. Therefore, the company will focus on exporting chopsticks from U.S. to Japan. However, the company should answer questions on the export-readiness framework for assessing the successful opportunity of the company in international market. According to the export-readiness framework, it divide into two parts that are “Is your company ready to export” and “Is your product ready to export”. In term of “Is your company ready to export”, this part also divide into two parts that are motivational and organizational factors. To apply this case, the motivational factors of Lakewood Forest Products has a consisting of three reasons for exporting. One reason is that chopsticks market has a strong growth in Asia. The company focuses on this market as a long-term investment. The important thing of investing in chopsticks factory is to find a new business opportunity because the existing products of the company (lumber and salmon) begin to collape. Another reason is that the company can produce its product at the lowest costs because of using an advanced technology. The quality of the product is also high because the company use the machine to make chopsticks, and no one had automated the process before.
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