Lincoln Electric Lab2

Lincoln Electric

Jiang Liu

What is the main problem to be solved? Are there any key issues (sub-problems) that need to be solved in order to come to a solution?

Main problem: For the future global market expansion of Lincoln Electric, John Stropki needs to make a decision about whether a strong push into India should be the next step in LE.

Key issues

 What is the benefit the India can bring to LE?

 How to enter India, by acquisition, by joint venture, or by building a new plant on its own?

 How to create new competitive advantages in India based on the competitive advantage build in North America?

 How to apply the past experiences in China, Japan and South Korea to India?

What case data/information identifies the problem, key issues and their resolution? How?

First of all, if LE wants to enter India welding market, John Stropki needs to know about what is the welding industry trend in India. On Page 9, it says India is the third-largest welding market in Asia, with $415million in 2005 and $500 million in 2006 in annual industry sales expected by year end. Stropki also noted that "India is currently rebuilding its infrastructure and therefore will need thousands of miles of new oil and gas pipelines. Exhibit 2 shows India has 3% market share of global welding industry, which is quite high for a single country compared with 5% in Latin America. Exhibit 11 and 12 show the financial reports of the two strongest competitors LE will face in India, which the data will help LE analyze Indian welding market better.

Second, Stropki needs to decide how to enter India. There are mainly three options which are acquisition, joint venture and build a new plant on its own. Through learning past experiences from market of China, Japan and South Korea, LE can find a lot of useful information of which way to choose to enter Indian market. (Page6-9) The local culture and government factors of India should also be taken in consideration while choosing which ways is the best to enter India. (Page 9-10) LE should also learn from its strongest competitor ESAB to see how it enters India market and whether it is good or bad. (Page 10)

Third, since North America contains 60% of LE's sales, the competitive advantage is quite successfully built in North America which is highly trained sales force and the support of its welding research and development staff. Like what LE did in North America, the market strategy should be useful while entering India. (Page 5) If LE wants to enter India, most of