Blades Incorporation

Blades Incorporation

Answer a)

Blades Inc. would gain a number of advantages if they opt to import from and/or export to Thailand. Since the inputs (plastic and rubber) are relatively low in cost when imported from a foreign country such as Thailand, this would potentially reduce the cost of goods sold of Blades Inc. and also increase their net income. Since a number of Blades competitors are already importing parts from Thailand, Blades decision to import would increase the company's competitiveness in the United States, particularly since its prices are amongst the highest in the industry of roller blades.

Additionally, since the company is considering long term plans in Thailand, exporting to and importing from Thailand might present it with a chance to institute initial associations with various Thai suppliers. Furthermore, if they expand to Thailand, Blade Inc. could be one of the first companies to sell their products in Thailand. In the view that Blades Inc. is considering to shift its sales eventually to Thailand, this would give them a major competitive advantage.

Answer b)

Blades Inc. should consider a number of potential disadvantages. First of all, the currency fluctuations in Thailand would affect the company (Lessard, & Nohria, 2012). For instance, imported inputs' dollar cost may eventually become more costly if the Thai baht values even if the Thai suppliers do not regulate their prices. However, the sales of Blades Inc. in Thailand would also increase in terms of dollar if the baht values, even if Blades does not raise its prices. In addition, the company would also be exposed to the financial conditions in Thailand. For instance, if there is a decline in commercial activity, Blades would experience from decreased sales to Thailand.

In the long run, the company should be aware of any environmental and regulatory constraints the government ...