SinYi Corporation Expansion Strategy in China (Simplified Chinese Version)
The president of SinYi Group was contemplating various ways of growing his highly successful Taiwanese real estate company in the mainland China market. SinYi had initially opened up company-operated branches and in 1999, in an effort to expand more quickly, he had obtained a Coldwell Banker master franchise under a joint SinYi/Coldwell brand. But SinYi’s growth in company-operated and franchised branches in China was still slow. He was considering whether he should establish a new company to run the franchise business exclusively using the Coldwell brand and reserve the SinYi brand for company-owned branches. This new approach would require a revision to the agreement with Coldwell Banker, which the president would need to evaluate.
This case will teach students how to use discounted cash flow to evaluate an investment strategy, how to compute the cost of capital for a foreign investment, the challenges of balancing shareholder value with social benefits, and how to assess alternative entry strategies.
Real Estate and Rental and Leasing
China; Taiwan, Medium, 2008
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