You are a senior production manager for a company that has traditionally pursued a corporate strategy of unrelated diversification. Your firm currently manufactures and sells the following products:
Luggage. This line is aimed at the low end of the market and isn't constructed on a wheel base. Writing instruments. This line includes mechanical pens and pencils which are sold to the middle-market segment between the low-end products such as Bic and high-end once like Montblanc. Color Televisions. The firm concentrates on high quality, wide screen, and LED televisions.
Miscellaneous plastic and paper tags. These items are sold as stock office supplies and used for filing or general label purposes.
Your boss wishes to expand internationally and thinks that in order to increase revenues your company should start pursuing a strategy of related diversification. Your boss would like you to examine the four products listed above and develop a strategy for incorporating any of these units into a related diversification strategy.
Please prepare answers to the following questions:
1. Evaluate the extent to which there are any bases of relatedness among the four products.
2. After reviewing the list, identify any products representing businesses that you would not include a related diversification strategy and provide a detailed explanation of your choice.
3. Identify two countries outside of the U.S. that you feel would be an opportunity for a potential business expansion and explain the basis for your selection.
4. Identify two other businesses that are related to the group above that you might target for acquisition.