The global economic crisis of 2008 caused a drop in the sales of a Lebanese wood company. The sales drop had been up to 30% in 2009 for the company. The year before the crisis had an investment by the company in the acquisition of a sawmill in Serbia. This acquisition was done in order to cover the demand of the lumber by increased capacity. However, during the global crisis, the company had the capacity to manufacture the product, but had a low probability to sell the lumber. Chami, the owner and president of the company was faced with a situation. He had to devise appropriate strategies to overcome this crisis. He was faced with an option of shutting down some parts of the newly acquired mill. The other alternative was to improve sales of the company in the areas in which the lumber was already sold. The third option was to expand the market to a new locality. The options included Iran, Jordan, Syria, and Iraq). The country that was regarded as the best one for international expansion was Morocco. This case raised a question about the suitable time for this growth.
1- What are the major issues and management problems challenging Chabros International Group in relation to Strategy/modes of entry; marketing strategy; and sourcing strategies/logistics;
2- What motivated Chami to expand Chabros’ operations internationally?
3- What strategy did he follow: International, multidomestic, global or transnational?
4- What strategies/options were available to Chabros to overcome the financial crisis? Which strategy/option would you recommend? Why?
A- If you decide to follow a market development growth strategy, into which new country would you expand? Rank the candidate countries. Explain how you derived your ranking.
B- If you decide to follow a market penetration growth strategy, in which country where Chabros is already operating should it expand further?
5- Would Morocco be a good country to enter as a new market?
6- Log on to the Chabros International Group website. Evaluate the website. Should any information be added or clarified? Provide one or two suggestions to Chabros on how it can improve its website for marketing its products and brand.