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University of Wales                   MBA International ManagementCritically evaluation of the international pricing issue...
ACKNOWLEDGEMENTSThis research would not be completed without acknowledging, support and guidance ofbelow persons.I would l...
ABSTRACTThis research critically evaluates the international pricing issue of multinationalcorporations, which operates ac...
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A case study of Bridgestone Corporation’s subsidiaries of UK and Turkey

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Critically evaluation of the international pricing issue for multinational corporations based on the factors that have impacts on pricing decision making in the context of the differentiated or similar characteristics of countries.
A case study of Bridgestone Corporation’s subsidiaries of UK and Turkey

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A case study of Bridgestone Corporation’s subsidiaries of UK and Turkey

  1. 1. University of Wales MBA International ManagementCritically evaluation of the international pricing issue for multinationalcorporations based on the factors that have impacts on pricing decision making in the context of the differentiated or similar characteristics of countries.A case study of Bridgestone Corporation’s subsidiaries of UK and Turkey by Tolga KOYMEN UoW ID: 1092227299339 19/12/2011 Supervisor: Kevin O’HARA
  2. 2. ACKNOWLEDGEMENTSThis research would not be completed without acknowledging, support and guidance ofbelow persons.I would like to thank to my supervisor Mr. Kevin O’HARA for all guidance, help and supportsprovided by him during my study.I would also like to thank to Mr. Brett EMERSON, Mr. Sevket SARAL, Mr. TolgaOZBAYAZITOGLU, Mr. Mustafa ORAK and to all Bridgestone family.I would specially like to thank to my wife, Mrs. Ilkay KURT KOYMEN for her supportingduring my whole MBA study and being part of my life.
  3. 3. ABSTRACTThis research critically evaluates the international pricing issue of multinationalcorporations, which operates across countries, based on the factors that have impacts onglobal pricing decision making in the context of differentiated or similar characteristics ofcountries. In order to achieving ultimate objective, the case of Bridgestone Corporation’stwo subsidiaries, which are Bridgestone UK and Bridgestone Turkey, was used.This research has been based on different theories behind international pricing which isindustrial economics theory, contingency theory, and corporation’s resources theory. In thecontext of industrial economics theory, it is found that Bridgestone is using benchmarkpricing strategy. Meanwhile, Bridgestone has been taking into consideration of pricefairness because of its distribution channel structure, competition laws, and entry barriers.On the other hand, costs, especially raw material costs, in which whole tyre manufacturershave lack of control, hugely impact pricing. Additionally, the labour costs and transportationcosts have caused becoming a competitive disadvantage for Bridgestone over itscompetitors, especially low cost Asian tyre manufacturers when pricing. In the context ofcontingency theory, Bridgestone has a tendency of adapting its pricing policy throughleaving it to local managements in each country in the case of different factors of locals. Thecompany has provided the opportunities of higher availability of quick and deeper marketanalysis and response, deeper penetration of local markets, better understanding ofsignificant differences of local markets, easier to get new ideas, opportunities andinnovations, and using the motivation of local management. Meanwhile, the strongcommunication between headquarters and its local subsidiaries has provided the correctimplementation of the pricing policy. In the contexts of corporation’s resources theory,Bridgestone has a tendency of making investments on branding, and brand awareness thatprovide the most competitive advantages which cannot be imitated by its competitors. Onthe other hand, original equipment impact which provides reinforcing on the choice of enduser’s tyre replacement decision with the same brand already fitted on the passenger car isbeing taken into consideration. On the other hand, again in the light of competitiveadvantages of corporation, it is clearly observed that Bridgestone has made investments onenvironmental friendliness, being safer for consumers’ family life, social responsibilitycampaigns, and after sales conveniences for customers in order to create positivedifferentiations, to provide emotional connections with consumers, to win the emotionalbranding race, and to sustain its leadership due to setting higher prices for its products overits competitors.Keywords: International pricing issue, factors that affect international pricing, internationalpricing in multinational corporations.

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