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Lincoln Electric

International Marketing Plan
by

Øystein Strand Teslo

on 21 February 2012

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Transcript of Lincoln Electric

Largest Welding Company Worldwide
Over 100 years of Experince
Sell products in 86 countries, and have manufacturing production in 19
Vision: " Be the global manufacturer and the market leader of the highest quality welding, cutting and joining products"
Company Profile Cleveland, Ohio
Welding
Consumables Welding
Equipment Welding
Consumables The welding industry is a $ 13 billion industry worldwilde
42% of sales are in welding equipment
58% of sales are in welding consumables
Welding products for many industries
including bridges, oilproduction facilities, and other building, infrastructurem, and commercial construction projects
Growth rate: 3 % in 2006
Sales are spread across various customer segments and different locations around the world.

The Welding Industry International Marketing Plan - Going into the Indian Market Case Study
Pola Paczkowska
Marie-Aude Therien
Anita Teigen
Peder Onsøyen
Øystein Strand Teslo Team Members
Their growth in the US is far from sufficient to meet their financial goals.
Not present in India, the third biggest welding market in Asia.
Motives :
India is the fastest-growing country in the world
Large focus on construction and infrastructure projects
44% of the market is owned by small companies
What is the problem? Competition in India ESAB Charter (PLC)
Market Leader
Built up market share through acquisitions
Have enjoyed little profitability in India through the years
Income increase in India from 2004-05: 28,84%
Ador Welding LTD
Local Indian Firm
Effective Production
Achieves Economies of scale
Income increase in India from 2005-06: 22,74%
Ewac Alloys LTD
A joint venture of Messer and L&T of India
$30 Million revenues in 2005
1. Introduction
2. Situation Analysis
2.1. Existing markets
2.2. Target market(s)
3. Evaluation of expansion alternatives
3.1. Pros and cons for each alternative
3.2. Decision matrix and recommendation Contents Achieve the financial goals
double the rate of growth operating margins over 15%
earnings growth of 10% annually
and return on equity exceeding 20%
Achieve these goals by:
Expand into new and attractive foreign markets
India
Further penetration in existing markets
Japan, South Korea and China
Major competitors are already present in India
ESAB Charter (PLC)
Ador Welding LTD
Ewac Alloys LTD
Need to act rapidly not to loose market shares


Our mandate: Develop an international marketing plan to help Lincoln Electrics achieve their financial goals, through entrance in the Indian market or further penetration in existing markets

What is at stake? Key success factors in the industry
Price
Brand preference
Product quality
Customer service
Breadth of product offering
Technical expertise
Innovation
Global sales:
Asia 45%, North America 23%, and Europe 21%
Lincoln Electric’s clients consists of many different industries:
General metal fabrication
Infrastructure building – including oil and gas pipelines and platforms
Buildings and bridges
Power generation
Transport and defense industries
Equipment manufacturers in construction
Farming and mining
Clients Distributors
General: Distribute equipment products at Home Depot, Lowes, or Wal-mart
Location
Sold in more than 86 countries
In Japan, LE had no distribution channel
In South Korea LE used a local distributor
In China LE have both distribution and manufacturing
In Shanghai they had no strong distribution channel
Institutions
Research: R&D investments
Financing 2/3 of the FCF for international expansion to meet financial goals

Collaborators Employees
Experience:
Award-winning engineer
High focus on R&D
“The welding experts”
Salary
Incentive system and bonus system
Piecework payment
Share their profit with their employees
Power
No-layoff policy
Employee stock ownership
Providers
General: Supply arrangement with FANUC Robotics
Location:
Have their own manufacturing facilities
Acquired manufacturing providers all over the world
Collaborators ESAB
Biggest Competitor in the world
European Based
Illinois Tool Works
Strongest competitor in the US
Air Liquide
European-based
Kobelco
Strong presence in the Asia-Pacific
region
Thermadyne Holding Corp
US. Manufacturer focusing on a
niche-market of gas apparatus equipment.
Main competitors Worldwide Hofstede analysis PEST analysis Greenfield Investment!
Full transcript