A Comparative Study of Business Strategies Between Korea and Japan: a Case of Electronics Items Between Samsung and Sony

5672 Words Jan 21st, 2013 23 Pages
A COMPARATIVE STUDY OF BUSINESS STRATEGIES BETWEEN KOREA AND JAPAN: A CASE OF ELECTRONICS ITEMS BETWEEN SAMSUNG AND SONY CHOONG Y. LEE * *Daniel Froes Batata, Ha Sook Kim, Gladys A. Kelce College of Business, Pittsburg State University, Pittsburg, KS 66762, U.S.A. ABSTRACT Sony, one of the world‟s most prominent companies in the electronics industry from Japan, has dominated the markets from all over the world for a long time since 1970s. Over the last decade, however, it has faced challenges to maintain its growth. Although sales levels have been relatively steady over the last decade, its profitability has gone from approximately eight to almost zero percent in 2009. Concomitantly, Samsung Electronics from Korea has successfully overcome …show more content…
COMPANY BACKGROUND Although Sony and Samsung Electronics are commonly recognized as successful companies in the electronics segment, their performances over the last decade have differed significantly. Sony has maintained its sales level since 1997 but its profits have been reduced to almost zero in 2008. Samsung Electronics, on the other hand, has increased its sales from about US$10,000 million in 1997 to over US$105,000 million in 2007. Additionally, its profitability in 2007 was approximately US$8,500 million – over ten times bigger than that of Sony. The market capitalization of both industries also followed very different paths. Sony‟s capitalization went from about US$ 20 billion in 1997 to about US$ 50 billion in 2007. That represents a growth of about 150 percent. Samsung Electronics, in turn, went from approximately US$ 2 billion in 1997 to about US$ 105 billion in 2007. Its growth was much higher than Sony‟s. Even though it is not likely that Samsung Electronics maintains such high growth indefinitely, its market capitalization demonstrates that ten years ago, the company was worth about one tenth of Sony‟s total value. Ten years later, it was worth almost two times as much. That shows that the confidence of the market in both companies has been very dissimilar in the past decade.
Sony Corporation is one of the most prominent companies in the electronics market in the world. It manufactures audio, video, communication, and information technology products

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