Chabros International Group: A World of Wood
(8 pages of text)
AWARD WINNING CASE - MENA Business Cases Award, 2012 European Foundation for Management Development (EFMD) Case Writing Competition. The Chabros International Group case examines how a Lebanese multinational wood company confronts a drastic drop in its largest subsidiary's sales after 2008's global economic crisis. Antoine Chami, Chabros's owner and president, was reviewing his company's 2009 end-of-year financial statements and, in particular, a 30 per cent drop in sales in Dubai. In 2007, a year before the global economic crisis, Chami had invested more than $11 million to acquire and expand a sawmill in Serbia to meet Chabros's growing lumber sales demand. With a much higher capacity to produce lumber and a much lower probability to sell it, Chami had to decide what to do to overcome this challenge. Should he close parts of his Serbian sawmill? Should he try to boost his company's sales to use all of his sawmill's available capacity? If so, should Chabros try to increase sales within the countries where it already operated (UAE, Saudi Arabia, Qatar, Oman, Egypt) or should it expand into a new country (Algeria, Bahrain, Iran, Iraq, Jordan, Kuwait, Libya, Syria, Tunisia)? Would Morocco, among other countries, be the best country to expand into? Was it the right time to embark on such an expansion?
This case can be used in an advanced undergraduate or MBA course in international business, or management, and/or strategic management. It presents the opportunity to review motivations for internationalization, the different “international” strategies (international, multinational, global, and transnational), crisis management, growth strategies (mainly market penetration and market development via exporting/importing and foreign direct investment [FDI] strategy), market entry (mainly country/market analysis and selection and comparative advantage), entry timing, and SWOT (strengths, weaknesses, opportunities, and threats) analysis.
Lebanon;Middle East;North Africa, Medium, 2010
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