Sharp Corporation final paper- business policy and strategy

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Mercyhurst University
Sharp Corporation
Strategic Plan and Analysis
Group 6: Brett Ball, Andrea Novoa, Kaleb Schwab, and Brianne Smail
BADM 405-02
December 3, 2014
Prepared for Dr. Kris Gossett

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Contents
Sharp Corporation........................................................................................................................ 6
Company Description:.............................................................................................................. 6
About This Report: ................................................................................................................... 6
Section 1 – Historical Analysis..................................................................................................... 7
1. Historical Analysis of Sharp Corporation ...................................................................... 7
2. Historical Analysis of Consumer Electronics Industry ............................................... 32
3. Historical Analysis of Key Competitors........................................................................ 36
Competitor #1 – LG Electronics........................................................................................ 36
Competitor #2 – Panasonic Corporation.......................................................................... 39
Competitor #3 – Samsung Electronics .............................................................................. 48
Competitor #4 – Sony Corporation................................................................................... 53
4. Discussion of Relevant Historical Environmental Changes in the Industry ............. 56
Macro-environment of the Consumer Electronics Industry........................................... 56
Historical Competitive Forces of the Consumer Electronics Industry .......................... 58
Historical Dominant Economic Features for the Consumer Electronics Industry....... 59
Works Cited – Section 1 ......................................................................................................... 60
Section 2 – Current Analysis...................................................................................................... 62
Subsection #1 – Company Profile.......................................................................................... 62
1. Discussion of Sharp Corporation’s Current Overall Strategy ............................... 62
2. Discussion of Sharp Corporation’s Current Competitive Advantage in the
Industry................................................................................................................................ 64
3. Discussion of Sharp Corporation’s Current Strategy Relative to the 3 Tests of a
Winning Strategy ................................................................................................................ 64
1. How well does the strategy fit the company’s situation?................................... 64
2. Is the strategy helping the company achieve a sustainable competitive
advantage?....................................................................................................................... 65
3. Is the strategy producing good company performance? ................................... 66
4. Discussion of Sharp Corporation’s Current Strategic Vision / Mission.................... 66
5. Identification of Sharp’s Core / Distinctive Competencies ......................................... 70
6. Current SWOT Analysis ................................................................................................ 71
Strengths .......................................................................................................................... 71
Weaknesses...................................................................................................................... 73
Opportunities................................................................................................................... 74
Threats ............................................................................................................................. 75

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7. General Discussion of the Current State of the Following Components ................... 77
A. Finance / Accounting Analysis .................................................................................. 77
Balance Sheet Discussion ............................................................................................. 78
Income Statement Discussion........................................................................................ 80
Statement of Cash Flows Discussion ............................................................................ 82
Stock Discussion ........................................................................................................... 83
Ratio Analysis ............................................................................................................... 85
B. Marketing Analysis .................................................................................................... 91
Products ....................................................................................................................... 92
Promotion .................................................................................................................... 99
Price............................................................................................................................ 103
Place............................................................................................................................ 105
C. Management Analysis.............................................................................................. 107
Subsection #2 – Industry Profile.......................................................................................... 112
1. Identification and Discussion of Relevant Competitors ........................................ 112
A. Relevant Information Regarding the Financial Position of Key Competitors
112
Competitor #1: LG Electronics................................................................................ 112
Competitor #2: Panasonic Corporation.................................................................. 115
Competitor #3: Samsung Electronics...................................................................... 118
Competitor #4: Sony Corporation........................................................................... 120
Financial Position Comparison of Competitors Using Ratio Analysis ................ 122
B. Relevant Information Regarding Current Marketing Strategy of Key
Competitors ................................................................................................................... 127
Competitor #1 - LG Electronics............................................................................... 128
Competitor #2 – Panasonic Corporation................................................................ 133
Competitor #3 - Samsung Electronics..................................................................... 137
Competitor #4 - Sony Corporation.......................................................................... 141
C. Relevant Information Regarding Current Corporate Structure, Leadership
Transitions, or Management Team of Key Competitors .......................................... 146
Competitor #1 – LG Electronics.............................................................................. 146
Competitor #2 – Panasonic Corporation................................................................ 148
Competitor #3 – Samsung Electronics .................................................................... 150
Competitor #4 – Sony Corporation......................................................................... 153
2. Discussion of Relevant Economic Factors Affecting the Industry ....................... 156

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3. Dominant Economic Factors.................................................................................... 160
4. Identification of Key Competitive Forces in the Industry .................................... 162
5. Discussion of the Current Driving Forces in the Industry .................................... 166
6. Creation and Discussion of Strategic Group Map................................................. 167
7. Identification and Discussion of Industry Key Success Factors ........................... 169
Works Cited – Section 2 ....................................................................................................... 173
Strategic Plan............................................................................................................................. 178
1. Discussion of Likely Strategic Maneuvers from Relevant Competitors in the Next 3
Years....................................................................................................................................... 178
Competitor #1 - LG Electronics....................................................................................... 178
Competitor #2 - Panasonic Corporation......................................................................... 180
Competitor #3 - Samsung Electronics............................................................................. 182
Competitor #4 - Sony Corporation.................................................................................. 185
2. Identification of Competitive 3-Year Strategy for Sharp Corporation ....................... 188
A. Discussion of Which Generic Competitive Strategy is the Best Fit for the Next 3
Years................................................................................................................................... 188
B. Identification of Offensive Strategies to Exploit Against Competitors and Which
Competitors You Will Use Them On .............................................................................. 192
C. Identification of Defensive Strategies to Protect Competitive Advantage from Other
Industry Participants and Which Participants You Should Implement Them For ... 195
D. Discussion of General Timeline to Implement Offensive and/or Defensive Strategies
in Next 3 Years .................................................................................................................. 196
Year One:....................................................................................................................... 196
Year Two: ...................................................................................................................... 196
Year Three:.................................................................................................................... 196
E. Discussion on Other Potential Supplemental Strategies........................................... 196
3. Identification of Relevant Issues Concerning International Markets and / or
International Suppliers......................................................................................................... 198
4. Brief Discussion of Functional Policy to Accommodate Strategic Plan....................... 200
A. Discussion of Strategic Policy Relative to Finance / Accounting ............................. 200
B. Discussion of Strategic Policy Relative to Marketing Strategy................................ 203
C. Discussion of Strategic Policy Relative to Management Strategy ........................... 207
Works Cited - Section 3........................................................................................................ 211
Contact Information................................................................................................................. 212

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Sharp Corporation
“Make products that others want to imitate.”
-Tokuji Hayakawa, Sharp Founder
(58)
Company Description:
Sharp Corporation is a Japanese multinational corporation that designs and manufactures
consumer and industrial electronic products. The company was founded in September 1912 by
Tokuji Hayakawa (59). Sharp is headquartered in Osaka, Japan. As of March 2014,
approximately 50,000 people are employed with the company (59). Sharp offers a variety of
products including LCD monitors, TVs AQUOS, mobile phones and smartphones, air purifiers,
solar panels and cells, home appliances, along with many other consumer, business, and
industrial products (60).
About This Report:
This report was compiled for Dr. Gossett’s Business Policy and Strategy Class for the Fall 2014
Semester at Mercyhurst University by Brett Ball, Andrea Novoa, Kaleb Schwab, and Brianne
Smail. It is a strategic plan for Sharp Corporation containing a historical analysis, a current
analysis, an industry profile, and a three year strategy for Sharp Corporation and the consumer
electronics industry.

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Section 1 – Historical Analysis
1. Historical Analysis of Sharp Corporation
Disclaimer: Most of the information used in this section came from PDF1 which is Sharp’s
historical document directly from their website, unless otherwise noted.
Tokuji Hayakawa founded Sharp Corporation in 1912. He opened a metal working
business with two other men, a craftsmen and an apprentice (PDF1). He first started producing
the Tokubijo buckle. His second product was the adjustable-flow faucet that took one minute
installing instead of thirty minutes like the other ones (PDF1).
In 1915 writing instrumental manufactures placed a large order of metal fittings for use in
a mechanical pencil, this product was considered the predecessor of the Sharp Pencil (PDF1).
Tokuji has set a goal of improving the mechanical pencil and after working for days he was
successful, the Hayakawa Mechanical Pencil was born (PDF1). Tokuji was reunited with his
older brother, the two established Hayakawa Brothers Company (Hayakawa Keitei Shokai) they
worked together to sell the mechanical pencils. They were exporting to the United States and
Europe (PDF1).
In 1916 Tokuji developed a super-fine pencil lead and they named it Ever-Ready Sharp
Pencil (2). Then they introduced more products including more affordable models, also luxurious
products made of gold and silver, and models incorporating a watch or a lighter (PDF1).
The company established a branch factory in 1920 in Oshiage and then purchased the
land for the third factory in Kameido (PDF1). The original Sharp Pencil was exhibited at the
Peace Commemoration Tokyo Exposition in 1922, where it received a gold medal that furthered
enhanced its reputation for quality and aesthetics (PDF1). Tokuji lost everything in the Great

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Kanto Earthquake in 1924, so he relocated to Osaka for a fresh new start. He established
Hayakawa Metal Laboratories (Hayakawa Kinzoku Kougyo Kenkyusho) (2).
1925 was a big year for Tokuji. He was looking for a new business area. He started
looking into radios, in April of this year he succeeded in assembling a radio, which was the birth
of the first crystal radio produced in Japan (2). Test radio signals began being broadcast from a
station in Osaka two months after they had succeeded with the radio, the radio worked perfectly.
It was their first step to becoming an electronics manufacturer (PDF1). They set up a sales office
in Osaka and began selling their products and also imported vacuum-tube-radios and parts
(PDF1).
In 1926 they started to export radios and radio parts to China, India, Southeast Asia, and
South America. Tokuji introduced an AC-powered vacuum-tube radio in 1929, which was as
good as the imported models but cost much less (2). In 1933 they started exporting to Europe,
Australia, and Africa too (PDF1). Hayakawa Metal Industry Institute Co., Ltd. (Kabushikigaisha
Hayakawa Kinzoku Kougyo Kenkyusho) was established in 1935 and Tokuji Hayakawa was
appointed president (PDF1). The company employed 564 workers. 1936 was the year the
company changed its name to Haykawa Industrial CO., Ltd. A new plant was built in Hirano.
The company broadened its sales network in 1937 by opening branch offices in Korkura,
Nagoya, Shizuoka, Sendai, Kanazawa, Hiroshima, Okayama, Kochi, Kumamoto, and Kagoshima
(PDF1). A new intermittent belt conveyor system was introduced to the radio production line,
based on Tokuji’s own design. Year by year the production increased dramatically; from 58,000
to 88,000 units in 1938, and then to 130,000 in 1939 (PDF1).
In 1942 they changed the name again to Hayakawa Electric Co., Ltd (2).1948 was the
year the company increased its capitalization to 30 million yen. The capital increased at the end

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of the year so they began trading its share through the Osaka Securities Dealers Association
(PDF1). In 1949 the company’s stock was listed on the Osaka Securities Exchange. The selling
price for the first trade was 42 yen per share (PDF1).
The new Sharp 5R-50 Superheterodyne Radio was introduced in 1950 it was a compact,
mass-produced model (PDF1). It had enough selectivity to prevent interference among broadcast
signals. A television prototype of a console-model television was completed in 1951; it was a
success at receiving television signals (PDF1). In 1952 Tokuji visited the Radio Corporation of
America in the United States and he signed a technical assistance agreement, and it led to
Japan’s first mass produced televisions (PDF1). The government approved the alliance with
RCA and the company started working on a design for a TV. Three models were created a 12, 14
and 17-inch screen, tests results were excellent (PDF1). The Sharp TV3-14T TV was the first
domestically produced television in Japan. The company also began publishing Sharp News, an
informational magazine that served as a bridge between retailers and the company (PDF1).
In 1953 Hayakawa Electric introduces its first commercial television set under the brand
name Sharp (2). 1953 is regarded as the first year of electrical appliance era in Japan. At the
beginning of the year they only produced 15 TV sets, but then the production volume increased
they knew it would get to 1,000 TV sets per month they reduced the prices (PDF1). To increase
production, the company continued to build extensions to its plants in 1954, with TV production
capacity eventually reaching 20,000 sets per month (PDF1).
The TB-50 from 1957 had the world’s first push-button tuner. This tuner allowed users to
quickly select a station simply by pressing a button, without having to turn a channel-selector
dial (PDF1). They announced a new business policy in which they were going to expand to
become a comprehensive consumer electronics manufacturer by adding more home appliances to

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the lineup (PDF1). They started with electric fans, refrigerators, washing machines, toasters,
electric rice cooker, and air conditioners. In 1958 Sharp Electric Co and Hayakawa Electric
became inseparable; one was dedicated to manufacture and the other to sell (PDF1).
In 1959 Hayakawa Electric began research and development on solar cells, a program
that would later become one of their top earners (PDF1). Hayakawa Electric also established
quality control in their plants this year (PDF1). In addition they constructed a new plant in order
to expand their consumer electronics division (PDF1). They finished out the year coming to
dealer agreements with two Southeast Asia companies, expanding their sales network (PDF1).
In 1960 Hayakawa Electric was instrumental in issuing in the color TV era with high
quality TVs (PDF1). They also constructed their first plant in Nara, Japan (PDF1). In the same
year they established their corporate health insurance program, developing medical products of
their own, and began using IBM computers at the corporate headquarters (PDF1). Hayakawa
Electric continued work on their value chain the next year by establishing a central location for
all the research the company does helping to decrease redundant behavior therefore decreasing
operational costs (PDF1). The President received the medal from Blue Ribbon for his work in
social welfare (PDF1).
In 1962 Hayakawa Electric created their first overseas sales base in the US when they
established Sharp Electronics Corporation (SEC) and began selling commercial-use microwave
ovens (PDF1). They also showed strong signs of corporate social responsibility (CSR) when the
President donated his own funds to build a Municipal building to help the elderly and disabled
(PDF1).They continued by providing Buddhist memorial services for deceased employees
beginning this year as well (PDF1).

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In 1963 Hayakawa Electric reorganized themselves into three divisions, radio, home
appliances, and industrial equipment (PDF1). They also expanded their solar cell research this
year, placing it on a much larger scale (PDF1).
In 1964 Hayakawa Electric released the world’s first all-transistor diode electronic
desktop calculator weighing in at 55 pounds (3). Hayakawa Electric began the research and
development at this point to make it smaller and more portable (PDF1).
In 1965 Hayakawa Electric adapted silicon transistors dropping the weight of the
calculator down to 35 pounds with the new CS-20A to be released the next year (PDF1). The
president also received the Japanese Order of the Sacred Treasure, Gold Rays with Neck Tie for
his success in both business and social welfare (PDF1). This was also the year Hayakawa
Electric began its five-year plan to get its outlet stores to account for 70% of their sales; it was to
be accomplished by 1970 so it was called the “70 Strategy”. Hayakawa Electric began its
“Attack Team of Market” (ATOM) this year when their inventory was backed up due to a
downturn in the market (PDF1). Hayakawa Electric was forced to shut down production for a
while, and they sent out employees from the manufacturing and engineering departments to sell
having no previous knowledge of selling (PDF1). This would turn into a successful program
helping to boost sales (PDF1).
In 1966 Hayakawa Electric developed the CS-31A, the first calculator to use integrated
circuits as opposed to transistors (PDF1). A Japan lighthouse used Hayakawa Electric’s solar
technology to harness solar power (PDF1). They also released the first microwave oven in Japan
with a turntable (PDF1). SEC dramatically increased their profits with the help of the CS-20A
(PDF1).

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In 1967 Hayakawa Electric finished construction of a dedicated radio production facility
outside of their normal production area (PDF1). The U.S. had reached 1.28 million TVs in
production for the year compared to 5,000 in 1962 (PDF1). They released the first microwave to
emit a ding when it was done (PDF1). Hayakawa Electric held fairs showcasing their products in
major Japan city department stores for their 55th anniversary (PDF1). Hayakawa Electric made a
step toward vertical integration by buying Sharp Electric (PDF1). They also managed to be the
first major Japanese consumer electronic company to get into Okinawa, then under US rule
(PDF1). This made them a domestic company and bolstered their southern market share ahead of
the competition (PDF1).
In 1968 a large scale plant dedicated to color TV production was completed to keep up
with demand (PDF1). Sales have doubled from 1966 to 1968 (PDF1). Hayakawa Electric held
their first presentation to establish the mission and the vision to the management, this has been a
mainstay ever since (PDF1). The CS-16A was released bringing the weight down to eight
pounds and moving ever closer to the personal calculator (PDF1). Exports had become 38% of
sales (PDF1). Hayakawa Electric spent the money they would have at an expo on opening up a
new Advanced Development center meant to develop new technologies (PDF1).
In 1969, they managed to release the world’s first battery-powered electronic handheld
calculator the QT-8D, and developed a signal to aide in the adjusting of color TVs (4). They also
ran a moral image campaign after finding their image worse than what they wanted (PDF1).
They rebranded themselves as a first class business possessing superior technology (PDF1). The
president began raising funds for social welfare and to increase their corporate social
responsibility image (PDF1). Hayakawa Electric began working with LCD technology (PDF1).

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In 1970, Hayakawa Electric was less recognized than Sharp forcing a name change to
Sharp Corporation (PDF1). Sharp developed the first infrared detecting light, later to be known
as LED lights (PDF1). President Tokuji Hayakawa was named chairman and Senior Executive
Director Akira Saeki was named president (PDF1). Sharp began developing a copier (PDF1).
Sharp’s plant was independently established as Sharp Precision Machinery Co (PDF1). This year
began a lawsuit of Sharp working against anti-dumping laws that would last until 1987 when the
lawsuit was dropped for good, this cost a lot in legal fees (PDF1).
In 1971 Sharp officially completed the plan to have 70% of their sales come from their
outlet stores (PDF1). Sharp got into the cash register business this year (PDF1). Sharp
established an Australian sales base (PDF1). They were also awarded the Okochi Memorial
Production Prize for their innovation in calculators (PDF1).
In 1972 Sharp’s first copier was released and was the first copier of its kind (PDF1).
Sharp recognized LCD’s as the next big step in innovation and began research and development
(PDF1). A new sales company system was organized by consolidating 61 regional companies
into 16, in order to create a larger sales force (PDF1). Sharp Systems Products was formed from
Sharp’s computer systems marketing division (PDF1). A Product Reliability Control Center was
established to better care for the customer creating another competitive advantage for Sharp
(PDF1). Due to consumer demand they established nine Business Cooperation Centers
throughout Japan (PDF1). Hayakawa Electric established a Europe sales base in West Germany
(PDF1).
In 1973, Sharp established the Business Philosophy, Business Creed, and Basic Business
Principles that have been guiding the companies these years (PDF1). Employee savings scheme
was established along with a new manufacturing base in Korea called the Sharp Data

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Corporation (PDF1). They released a pocket-sized calculator utilizing LCD technology. Sharp
began working on ways of preventing energy waste (PDF1).
In 1974 Sharp released the HAYAC-5000 an office computer doing spreadsheets
previously only able to be done by large computers; in addition they released another smaller
calculator (5). They also combined their Refrigeration Equipment with the Air Conditioning and
vending machine divisions to create the Commercial Equipment Division (PDF1). They also
developed a thinner, power saving, higher quality than CRT screens (PDF1). Canadian and
Malaysian Branches were established along with company-wide quality standards to
accommodate the quickly expanding company (PDF1).
In 1975 the Australian branch began manufacturing and selling color TVs (PDF1). This
was also the beginning of a major shift in strategy to improve their balance sheet (PDF1). Sharp
implemented a plan to reduce debt, improve their Capital to Assets ratio, and lower their break-
even point (PDF1). This was set into motion by departments reducing their Accounts Receivable
and inventory levels (PDF1). This gave them the ability to invest more. The 9 mm calculator
came out this year (PDF1).
In 1976 Sharp released the world’s first solar powered calculator (PDF1). They also
managed to find a quick cost-effective way to put large-scale integrated circuits (LSIs) into small
calculators and make smaller lighter copiers this way (PDF1). This was a major innovation in the
calculator industry in which they were already the leader (PDF1). This forced them to build a
new manufacturing plant at the end of the year (PDF1). They began a new plan called the New
Life product strategy where they proposed a new lifestyle to the baby boomers (PDF1). They
began looking at their customers and then picking the products that suited them as opposed to
taking their products and identifying what customers could use them; this is an innovative

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strategy that works for many successful companies today (PDF1). The first products in this new
strategy were a 16 inch color TV that was as heavy as a 14 inch TV, and a refrigerator with the
refrigerator on top with a vegetable drawer that could have the temperature controlled separately
in response to housewives that wanted to keep vegetables fresh without them drying out (PDF1).
Sharp solar cells were also sent to outer space on a Japan satellite, the quality assurance had to be
outstanding because repairs were near impossible once the ship was launched (PDF1). Sharp
began research on LCD TVs this year (PDF1). This was the first year in ten straight years of
growth for the company (PDF1).
In 1977 a new committee was formed to inform all employees of the New Life strategy
(PDF1). Sharp also began creating task forces from multiple departments to deal with company-
wide issues as they arose; 14 task forces were established this year (PDF1). They also released a
calculator that took advantage of the LSI capabilities and was the first C-MOS based calculator
that included games (PDF1). Another calculator came out that got rid of buttons to be touch
screen and was 5 mm, this was effectively marketed on commercials claiming “The button war is
over” (6). Sharp’s first pocket computer came out this year when they added programming
capabilities to a calculator (PDF1). Sharp System Service was formed from the service
departments of Sharp’s Office Equipment sales offices as a dedicated centralized service office
for office equipment (PDF1). This is also the year manufacturers voluntarily agreed to limit the
export of color TVs to the U.S. (PDF1).
In 1978 Sharp came out with a 3.8 mm calculator that was manufactured through an
automated process at a low price. This calculator was introduced as a permanent exhibit in the
museum of modern art (PDF1). Sharp released their first personal computer this year as a build-
it-yourself (PDF1). They also released the first desktop computer to scan documents like it was

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taking a picture (PDF1). Sharp began a new three-year plan to quickly “Advance, Challenge, and
Expand” mostly by introducing automation to many assembly lines (PDF1). Nine equipment
sales departments were organized into two different departments, one for Eastern Japan and
another for Western Japan (PDF1). Sharp met with U.S. government officials to get approval to
have their first production base in the U.S. (PDF1).
In 1979 Sharp introduced its first electronic translation device (PDF1). Two new
departments were created, one to focus on selling medical equipment, the other in application
software development (PDF1). The first U.S. manufacturing site was built (PDF1). A Swedish
marketing and sales division was formed (PDF1).
In 1980 Sharp formulated the “New Business Style at work” campaign to pair with the
new life style strategy formed previously (PDF1). Sharp had two new products that generated
multiple new interests this year, a new VCR and a new double cassette player (PDF1). A new
plan to reach one-trillion yen in sales by 1987 was introduced (PDF1). This is the year the
founder Hayakawa passes away (PDF1). A new group was formed to commercialize solar power
(PDF1). The next generation of Sharp’s pocket computer was introduced with more
programming capabilities than the previous generation (PDF1). A fax machine was introduced
capable of sending and receiving text much more clearly (PDF1). A nationwide industrial
equipment department was formed from multiple equipment divisions (PDF1). A new computer
design program was introduced that reduced design time down to one-tenth the normal time
(PDF1). A manufacturing base was built in Malaysia (PDF1).
In 1981, Sharp developed its laser technology coming out with multiple laser technology
products such as a product that detected moving pictures as they were forced to scale back their
solar energy program because the solar energy market was declining (PDF1). They discovered a

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longer lasting laser technology that significantly extended the life of a laser to 40,000 hours
giving them a new competitive advantage (PDF1). A new electronic translator came out with
voice detection capabilities. Sharp released their high-end personal computer model this year
(PDF1). The personal computer division was placed under the Calculator division (PDF1).
Twelve companies combined to form Sharp Consumer Electronics Company this year resulting
in four companies that span Japan (PDF1). Sharp became the leader in US copiers because they
were the only one’s offering compact copiers (PDF1). Sharp finally began full-fledged marketing
in China (PDF1). Mass production began on CD players using the laser diode technology Sharp
had developed (PDF1). The anti-dumping suit was halted by a US judge (7).
In 1982 Sharp came out with their first electronic typewriter, this was meant for offices
(PDF1). They came out with a screen that could be used as both a TV and a PC screen (PDF1). A
manufacturing base was established in the Philippines (PDF1).
In 1983 Sharp’s first facility with the ability to mass produce electroluminescent screens
that were 2mm thin, ran at one fifth the power of a normal screen, and no blurring opened
(PDF1). A TV screen that uses LCD technology was created (PDF1). Sharp Engineering
Corporation was formed from 10 consolidated service companies (PDF1). The anti-dumping
case was reopened in the U.S. for only a few companies; one of those companies was Sharp (7).
In 1984 a copier small enough for personal use was released (PDF1).
In 1985 Sharp altered their “New Life” strategy to “New Life People”, changing from
focusing mostly on family to now focusing on a younger demographic with “unique personalities
and a strong sense of individualism” (PDF1). The plan to reach one million yen in sales by 1983
reached is culmination this year, two years late (PDF1). Export sales were beginning to shrink
(PDF1). Sharp began its Attack ’90 plan looking ahead to the 90’s to have management

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strengthened (PDF1). A major part of this plan was establishing a creative environment for
managers and their employees (PDF1). A 0.8 mm thick calculator was introduced (PDF1). Sharp
released their first high-speed copier (PDF1). The Fukuyama plant was established and used
robots in all of its production (PDF1). Sharp established a UK manufacturing plant (PDF1). A
marketing base was established in Malaysia (PDF1). Sharp held a technology showcase in China
to get the news of their products marketed in China (PDF1). A center to hold focus groups for
Sharp was established by the then Director Tsuji (PDF1). Sharp established a Communication
Audio Division inside their audio division in response to the telephone market opening up this
year (PDF1). Sharp showcased the first English-to-Japanese translation system for
minicomputers (PDF1). The LCD research and development paid off with a prototype 3 inch
LCD TV (PDF1). Sharp released a facsimile, a compact fax machine (PDF1). Sharp also
established their own import company (PDF1).
The start of 1986 brought about some major changes for Sharp Corporation as a whole.
On June 27, 1986, Saeki resigned as the President of the company and became a new acting
chairman (PDF1). Haruo Tsuji, previously a senior executive director, was appointed the new
President upon Saeki’s resignation (PDF1). In January, the LCD department was upgraded to the
Liquid Crystal Display Division, which indicated the company’s determination to focus
specifically on LCDs (PDF1). In October, efforts were made to revitalize the business with a
variety of 116 items companywide: such as the introduction of new products, the utilization of
parts procured from overseas, and the review of different expenses (PDF1). Throughout the year,
Sharp consolidated the separate marketing groups that existed for consumer electronics and
information equipment into one organization (PDF1). Sharp introduced a variety of products into
the market during 1986 including a desktop-size high-precision colored scanner, an answering

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machine, and the first products from the U’s series: a toaster and microwave oven (the RE-102)
and a combination microwave and refrigerator (the SJ-30R7) (PDF1). During the Japan
Electronics Show in Tokyo in 1986, Sharp Corporation exhibited a 3-inch TFT LCD television
with about 92,000 pixels (PDF1).
In January of 1987, Sharp introduced the world’s first kanji-capable electronic organizer,
which had five personal information management functions: a calendar, scheduler, memo
function, phone book, and calculator (8). The X68000 Series was introduced in March and had
natural color graphics and superb sound quality (PDF1). The company introduced the WD-540
word processor in May of 1987, which was loaded with the artificial intelligence dictionary that
was developed by Sharp (9). On June 26, Saeki retired from acting chairman and became a
corporate advisor (10). The 3C-E1 3-inch LCD color television was released in October, and an
ultra-low-power CJ-S30 cordless phone was introduced at the end of the year in December
(PDF1). After stepping in as the new President of Sharp Corporation, President Tsuji introduced
and set a company-wide slogan: “Catch the opportunity in change and create new demand. Have
a creative spirit for innovation and act upon it (PDF1).” Other important events in Sharp’s
history from 1987 that should be noted are that the company released the ES-X1 washer and
dryer that incorporated a washing machine and dryer in one unit, they developed an ultra-high-
luminance 5,000 mcd LED lamp which expanded the application of LEDs to electronic
billboards, tail lights for automobiles, and other uses, and the name ‘Sharp’ became linked with
LCD (PDF1).
April 1988 brought about the introduction of the low-power CJ-S100 cordless phone
(PDF1). As Sharp was beginning to prepare for its 80th anniversary in 1992, they implemented a
new company-wide strategy to use optoelectronics as a core technology to expand the size of the

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business and it also called for placing more emphasis on information and electronic devices, as
well as other new areas (PDF1). Two employee focused programs were started including: an
internal application program where employees could tackle areas that the company was pursuing
and a program that sent employees for a limited time inside and outside the company so that they
could gain a wider range of knowledge in the field (PDF1). During 1988, Sharp introduced the
WV-500 laptop word processor, completed the first prototype of the 14-inch color TFT LCD,
and commercialized a series of mobile information tools under the brand name of Bware
(Business Ware) (PDF1). Sharp Corporation also made it clear in their basic corporate policy
that it intended to become a comprehensive electronics company with optoelectronics as its core
technology (8).
Sharp Corporation continued their endeavors into the year 1989, when it introduced an
industry first – a refrigerator with a dual-swing door that could open to the right or left (the SJ-
38WB) (11). Another industry first was introduced in September of the same year when the
company introduced the first low-power cordless phone with an answering machine (the CJ-
A300) (12). Sharp also introduced its first full color copier (the CX-7500), the LCD projection
system which made it easy to create a 100-inch display (the XV-100Z), and the industry’s first
video camera with a color LCD viewfinder which made it possible for users to identify objects
by color (PDF1). The LCD projection system received the grand prize at the 1989 Nikkei
Outstanding Products and Services Awards (PDF1). A new personnel evaluation system was
implemented where employees had an interview with their superiors to set goals and evaluate
their performance (PDF1). In 1989, Sharp embarked on the development of a global network
linking all of its business locations around the world using dedicated telecommunications lines
(PDF1).

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The year 1990 saw the introduction of a home use fax system, (the UX-1), that could be
placed beneath a telephone in October (13). Two months later, in December, Sharp introduced a
VCR that had a vacuum deposition head and enabled users to enjoy high-quality images, even
when playing them back in extended play mode (PDF1). A new up-to-date model of Sharp’s
word processor was released in 1990, (the WD-A340), which included Super Outline Fonts that
could be printed beautifully regardless of the font sized used (PDF1). A classroom / learning
support software developed by Sharp System Products that utilized networks and supported the
creation of teaching materials was introduced in 1990, as well as the AX386LC color TFT LCD
Laptop PC (PDF1). Sharp developed an EL display capable of processing handwritten text that
users could input as if they were writing on paper (PDF1). The company also revealed a
convection microwave that it had been developing that incorporated fuzzy logic control (8).
In April of 1991, Sharp Corporation instituted a system to oversee product quality and
reliability and different environmental issues (8). The company achieved two industry firsts in
the year of 1991. The first was the introduction of a fully automatic washing machine, (the ES-
B750), which used air bubbles to clean (PDF1). The second was the first wall-mount LCD TV,
(part of the 9E-H series), which also incorporated the industry’s largest 8.6-inch TFT LCD with
437,760 pixels (8). Aside from producing industry firsts, 1991 also brought about the
introduction of the business use word processor (the WD-SD70), the release of a high-speed
copier (the SD-2075), and the introduction of a pocket cordless phone with an answering
machine function, which featured an easily portable handset (PDF1). Throughout 1991, Sharp
continued to reinforce its leadership position in the LCD field by completing a new LCD plant in
Japan, as well as a new facility for mass-producing LCD panels in the United States (PDF1).

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The global network of telecommunications lines that was started in 1989 covered sixty
two bases in thirty countries as of April 1992, which meant that these countries were able to be
globally connected to one another (PDF1). One electronic product that was debuted in October
of 1992 was the ViewCam, which had a promotional concept of “shoot, watch, and enjoy” and
ushered in a new era of video cameras (14). The year 1992 saw the release of a portable word
processor with handwritten input via a pen-stylus (the WV-S200), the release of a high definition
television with a built-in MUSE decoder (the 36C-SE1), and the release of a 16:9 widescreen,
ultra-high-resolution high definition television with 1,125 scanning lines, which was more than
twice as many as conventional televisions (PDF1). Sharp Corporation introduced a variety of
products into the market in 1992 including: a word processor that allowed handwritten editing
using a pen-stylus (the WD-A751), a fully automatic washing machine (the ES-BE65), an
electronic organizer with a pen-based operation, and the RZ-A765 for system products with a
duty color LCD (PDF1). As a corporation, Sharp celebrated its 80th anniversary and also added
six new sales organizations, which made for a total of nine subsidiaries in nine countries (PDF1).
Sharp Corporation signed a long-term business partnership with Intel Corporation of the United
States, with a major focus on research and development and the production of flash memory
(PDF1).
In 1993, Sharp Corporation debuted the world’s smallest and lightest portable MiniDisc
player of its day that took the industry by storm (15). Two different refrigerator models were
introduced and developed throughout 1993: the SJ-V45K which used a newly developed CFC-
free vacuum insulation material and the SJ-SE40R which became number one in the industry for
energy savings (PDF1). The LCD ViewCam that was introduced in 1992 grew into a flagship
product for Sharp during 1993 and showed the world that “LCD is Sharp” (PDF1). The growth

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of this product contributed to the boosting of the company image (PDF1). A new PDA, the
Zaurus, was developed and incorporated new features such as facsimile transmission, PC linking,
handwriting recognition, and multimedia (16). The Zaurus became one of Sharp’s flagship
products alongside the ViewCam (PDF1).
Sharp Corporation continued their innovative success into 1994 as they developed and
introduced more products into the industry. Sharp developed the industry’s first reflective color
TFT LCD that was easily viewable, even outdoors, and did not require a backlight in 1994 (8). A
new residential solar power system consisting of monocrystalline solar cells with high
conversion efficiency and compact power conditioner to handle the grid interconnection was
introduced (PDF1). The company also introduced an enhanced version of their digital copier, the
AR-5040, which made physical copies after first storing digital images of the originals on a built
in hard drive (PDF1). Sharp announced the development of a 21-inch TFT color LCD wall-
mount TV, which was the world’s largest up to that point in time (8). This development showed
the world Sharp’s high standard of LCD technology and broke the 20-inch barrier in the industry
(PDF1). Aside from introducing and developing new products in 1994, Sharp was also in the
process of expanding their production facilities. The company established a new plant in
Indonesia for the production of color televisions and refrigerators (PDF1). A new production line
was also started in August of 1994 that would produce four 104-inch LCDs from a second
generation glass substrate (PDF1).
Sharp Laboratories of America, Inc. was established in 1995, which continued the
expansion of the company (17). This facility, located in Washington State, was founded so that
researchers in America could use rapidly advancing multimedia technology to create original
products for the company (17). The year 1995 also brought about the introduction and launches

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of more new products from Sharp Corporation. The Mebius notebook PC, (the AV1/50CD), was
launched as a core Pi2T product (PDF1). Sharp introduced products including an updated version
of the digital copier originally introduced in 1994 that included facsimile functions (the AR-
5030FR) and the RZ-A505 for system products with an 8-inch color TFT CLD display (PDF1).
A Window series of LCD televisions that included the 10.4-inch LC-104TV1 model was also
introduced in 1995, which was promoted as a line of personal televisions that could be set up
almost anywhere (PDF1). The company announced their development of a 28-inch LCD using
next-generation LCD technology (PDF1).
In May of 1996, Sharp Corporation was among the first companies to establish an online
presence in the early days of the commercial Internet (17). Websites were created in Japanese
and English in order to provide company information and new product news to the public (8). A
new air conditioner was introduced in October that featured conventional dehumidifying,
heating, and cooling functions but also featured a ventilation function and a humidifying function
that did not require a water supply (PDF1). This air conditioning model was an industry first.
The MR-1 was introduced in 1996, which included different functionalities, such as internet
access and PC communication (PDF1). A colored version of the Zaurus PDA was released (8).
Sharp Corporation’s innovation and different products won them awards and got the company
recognized globally. The colored version of the Zaurus PDA won numerous awards throughout
Japan and the United States of America (8). Japan’s leading economic daily newspaper chose
Sharp Corporation as the second best domestic company, out of 1,054 companies, for fiscal year
1995 (8). The newspaper rated Sharp highly for the development of key devices and original
products with unique features such as the company’s LCDs, its constant effort of developing and

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releasing demand-creating products, and increased sales and profitability for four continuous
years (8).
October of 1997 brought about Sharp Corporation’s effort to promote environmentally
sustainable management by establishing the Environmental Protection Group (8). The
Environmental Protection Group promotes a 3G1R strategy company-wide: Green products,
Green factories, Green mind, and Recycling business (8). Sharp aimed to become the number
one environmentally responsible company in the industry with respect to all aspects of the
company (8). Sharp launched a website that was specifically designed and catered towards
material procurement (PDF1). The company began satellite based digital communications
service in 1997 (PDF1). The Sharp Middle East Free Zone was established which managed the
markets of the Middle East, Africa, and Central Asia and worked to expand sales throughout the
entire region (PDF1). Sharp Corporation announced success in the development of a 42-inch
plasma addressed liquid crystal (PALC) display to drive LCDs, but ultimately ended up shelving
the product for certain reasons (PDF1). Although this product was shelved after development, it
still proved that large screen could be done which was a huge step for Sharp Corporation in the
industry (PDF1).
On June 26th of 1998 brought about changes for the leadership of Sharp Corporation.
Corporate Senior Executive Director Katsuhiko Machida was named the new Sharp President,
while President Haruo Tsuji became a corporate advisor for the company (17). Corporate advisor
Saeki became a corporate senior advisor for Sharp on this day as well (PDF1). In August of
1998, the new president declared that all televisions sold in the Japanese domestic market would
be replaced with LCD televisions by the year 2005 (17). With this decision, President Machida
chose the LCD business as Sharp Corporation’s focus (PDF1). A decision to streamline

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operations and strengthen the frontline of sales in October of 1998, meant that Sharp’s sales
companies for home appliances and information products were to merge into one segment
(PDF1). Company changes were not the only thing to occur in 1998; new products were also
developed and introduced to the marketplace. Sharp developed the world’s first System LCD
(PDF1). The company also succeeded in becoming the first company in the world to create a
stacked CSP for mobile devices that layered two LSIs to fit into a smaller package, which in turn
enabled the creation of smaller devices (PDF1). The J-SH01 mobile phone was developed, which
could display text messages that were eight characters by six lines long (PDF1). This model
became very popular and was the key to success for Sharp into getting in the mobile phone
business (PDF1). Sharp introduced an easily portable B file size notebook PC, the Mebius PC-
PJ1 (PDF1). A new series of Sharp’s multifunctional printers were developed in 1998 – a 3-in-1
unit which combined copier, fax, and printer functions into one (PDF1).
The Crystal-Clear Company Declaration was made in January of 1999 by Sharp’s
management, which called for the company to become the only company of its kind that shined
with unique technologies like LCDs (PDF1). Sharp Corporation announced the world’s first 20-
inch LCD televisions in February of 1999 and began sales immediately in March (8). The
world’s first Internet-capable microwave oven was released during this year, which let users
download recipes from the Internet that included automatic heating instructions (8). Building off
of the environmental program that was started a few years earlier, Sharp took measures to reduce
waste and greenhouse gas emissions and established Green Factory Guidelines (PDF1). The
company also felt that it was important for stakeholders to know what environmental policies the
company was enacting. Sharp Corporation began publishing the Sharp Environmental Report,

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which disclosed environment-related information and enhanced communication with its
stakeholders (PDF1).
From January 1st through January 4th of 2000, Sharp Corporation ran a massive
commercial campaign on TV to advertise and promote their LCD televisions and the LCD
business (PDF1). The company released the FU-L40X PC1 air purifier in October (PDF1). This
air purifier used the world’s first Plasmacluster ion air purification technology, which emits
positive and negative ions into the air, in turn deactivating impurities (8). This air purification
technology was also developed by Sharp (8). The J-SH04 was introduced to the market in
November of 2000, which was the industry’s first mobile phone that was equipped with a camera
(18). This phone also enabled users to send and receive photos as email attachments (18). The
next version of the mobile phone, the J-SH05, was introduced the following month in December
(PDF1). This version of the mobile phone was a flip-type phone with a TFT LCD that could
display 65,536 colors (PDF1).
Sharp Corporation introduced a variety of new products into their LCD television market
in January of 2001 including the 20-inch LC-20C1, the 15-inch LC-15C1, and the 13-inch LC-
13C1 (19). The company’s LCD televisions took on the nickname AQUOS, also in January
2001, which combined “aqua” (water) and “quality” to express the image of liquid crystals
(PDF1). The debut of AQUOS occurred in August 2001 at IFA, Europe’s largest exhibition of
AV and multimedia products (PDF1). The next model of Sharp’s mobile phone, (the J-SH07),
was introduced in June, which was a flip-type mobile phone that was equipped with a camera
and TFT LCD (PDF1). Sharp Corporation used the PC1 generators that it developed in air
conditioners, clothes dryers / dehumidifiers, refrigerators, humidifiers, and humidifying ceramic
fan heaters (PDF1).

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In 2002 marked Sharp Corporation’s 90th anniversary (PDF1). July of 2002 brought about
the development of the groundbreaking 3D LCD that did not require special glasses to be worn
by the viewer (PDF1). The same technology was used for the SH251iS mobile phone from NTT
DoCoMo and for the Sharp PC-RD3D notebook PC (PDF1). A company-wide campaign was
launched in 2002 called the ‘Be Sharp Initiative’, which aimed at improving the company’s
brand power (PDF1). Management wanted to build a stronger brand by creating a new vision and
developing products that reflected such a vision (PDF1). In November of the same year, Sharp
commissioned Hittsubashi University’s Professor Kunio Ito, (who helped develop a method to
measure the value of branding), to assist and promote branding activities for the company
(PDF1). Sharp Corporation introduced the 37-inch LC-37BD5 into the market, which
incorporated the HDTV LCD panel and also utilized quick shoot technology that ensured clear
images (PDF1).
In April of 2003, Sharp Corporation instituted the Sharp Charter of Conduct, which
placed an emphasis on the importance of observing regulations and respecting corporate ethics
(PDF1). Sharp shifted to high-resolution LCDs in 2003 for mobile devices and began a full-scale
production of System LCDs (PDF1). The company began their solar production in the United
States at Sharp Manufacturing Company of America in Memphis Tennessee, which produces a
variety of modules for commercial and residential solar installations (8). Sharp developed and
implemented a technology that enabled the repeated recycling and reuse of waste plastic as
material for use in new products such as in air conditioners, television sets, refrigerators, and
washing machines (8). This technology used by Sharp Corporation in 2003 was an industry first
(8).
Tokuji Hayakawa phrased the embodiment of the company in a single slogan “make

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products that others want to imitate” (8). Sharp has been a leader in technology with new
innovations for electronics, appliances, industrial equipment, and office use. Since Sharp’s
expansion out of Japan in 1962, the company has prospered in the United States for the past 50
years. The era of Internet reliance from the past two decades has helped Sharp make a more
definitive presence in the technology world. “From the first solar-powered calculator to the
largest commercially available LCD monitor, from copiers to solar cells, from air purifiers to
steam ovens, and from microelectronics to microwave ovens, Sharp covers all of the needs of the
contemporary lifestyle” (8).
Within the last decade Sharp pioneered several new products such as the state-of-the-art
Kameyama Plant in 2004. The Kameyama Plant created and incorporated the manufacturing of
TVs and introduced popular high-quality LCD TVs that came to be known as “Kameyama
models” (PDF1). This plant helped establish the concept of environmental technology to the
company that became critical for their growth. The Kameyama Plant was also Sharp’s first
Super Green Factory and promoted environmentally friendly production through reduced CO2
emissions and 100% recycling of wastewater. The facility was built to withstand natural hazards
including earthquakes. From this development, Sharp began to expand to energy-creating solar
cells and energy-saving LCD TVs. Sharp has also developed Illuminating Solar Panels that
utilize high-luminance LEDs (light-emitting diodes) with transparent, high-conversion-efficiency
thin-film solar cells. These solar panels allow light to pass through them and can provide
illumination in the evening due to the implanted LEDs. Additionally in 2004 Sharp integrated a
Superheated Steam Oven. This innovative appliance promotes greater health with technology
“that achieves low-calorie, low-salt cooking using superheated steam at about 300°C. The
process enjoys three major features—reduced fat, lower salt, and preservation of vitamin C in

30 | S h a r p
foods” (8). Sharp continuously reached to be a company with zero global warming impact. They
desire to balance the greenhouse gases emitted from production through distribution of energy-
saving and energy-creating products. In 2004, Sharp rapidly expanded business in overseas
markets such as China. Through the year, Sharp established the SHINE (Sharp International
New Experience) program. This provided an opportunity for a training system allowing young
employees to earn work experience and learn a language abroad.
Sharp became a leader for solar cell production and environmental companies and in
2005 they introduced a 65V-inch Digital Full-HD LCD TV, which was the largest in the world at
the time. Continuing their leading steps towards environmental friendliness they installed a 4.5
kW Sharp solar system in Major League Baseball’s San Francisco Giants’ AT&T Park. “The
system generates 120 kW of clean electricity that is fed back into the grid serving PG&E's
customers throughout northern and central California” (8). Also in San Francisco, they built a
904 kW Sharp solar system at FedEx’s hub at Oakland International Airport. This provides
around 80% of the electricity that the system needs.
LCD panels are a large part of Sharp Corporation and therefore they created a system that
stabilizes a system to ensure a dependable supply. They adopted “eighth-generation glass
substrates (2,160 x 2,460 mm), a world first, and sets up a global five-base production system
with the goal of producing products in the region in which they are used” (PDF1). Also in 2006,
the Japanese Environment Association awarded Sharp with the Eco Mark, which is a Type I
environmental labeling. After this recognition Sharp developed samples of laser diode that can
reach a 10,000-hour service life. At the time this was the longest in the industry and only used
168mW of power. “This diode is ideal for playback of next-generation DVDs, such as Blu-ray
Discs and HD-DVD” (PDF1).

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At the 2007 Consumer Electronics Show in Las Vegas, Nevada Sharp presented a 108V-
inch LCD TV that was created at the Kameyama Plant made from the first eighth-generation
glass substrates. During this year, Sharp continued to produce various LCD technologies. The
Mobile Advanced Super View LCD and System LCD technology with embedded optical
sensors; these feature touch-screen and scanning capabilities (PDF1). Sharp establishes its solar
system on the Google headquarters in California. It was the largest commercial solar installation
at the time. “In addition to roof-mounted arrays, the system also features a new structure that
encompasses two carports under which employees can park – and if they drive a plug-in hybrid -
recharge their car” (PDF1).
In 2008, Sharp continues their development with LCD TVs and released the Next-
Generation X Series AQUOS® LCD TVs. This product shows off their Mega Advanced Super
View LCD, which incorporates superb picture quality, a thin-profile design, and exemplary
environmental performance. Sharp uses 1-Bit digital amp for optimal sound quality. Sharp’s
growth lead to a joint venture with Italy’s largest power company Enel SpA (Enel). They agreed
to operate as an independent power producer (IPP). The agreement leads to the development of a
number of solar power plants with a total capacity of 189 MW by the end of 2012 (PDF1).
Another accomplishment that they achieved in 2008 was to produce the one millionth solar
module at Memphis factory and grow production capacity at Sharp Manufacturing Company of
America (SMCA) to 100 MW.
By 2009, Sharp revealed the DL-L60AV LED lamp. It features a remote controller for
changing the color of the light; this is also an industry first. “Users could select their preferred
shade of white according to the weather, season of the year, or time of day. For example, warm
white during the winter or at dinnertime when a relaxing atmosphere is desired, or a crisp cooler

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daylight white during the summer or in the morning for a refreshing wake-up” (20). Sharp
pushed its aim to become an eco-positive company in 2009. They had accomplished an
environmental vision of energy creating and saving products to balance greenhouse gas
emissions. They set goals for 2012 to have reduced greenhouse gas emissions by more than
double. “In fiscal 2007, Sharp captured a dominant 43.9% share of the LCD TV market in Japan
(based on Sharp research). Sales of AQUOS LCD TVs in particular received a further fillip in
2009, when the Japanese government enacted its Eco-Point program. This economic stimulus
package used a system of incentives to encourage citizens to purchase energy-saving and eco-
friendly home appliances such as air conditioners, refrigerators, and TVs compatible with digital
broadcasting” (PDF1).
In 2010, Sharp implemented its Eco-Positive Vision to the corporate level and defined the
image that they would work to achieve. Sharp released new LCD TVs that utilized four-
primary-color 3D LCDs, an industry first. This was based on their UV2A technology, adding
yellow to the three red, green, blue, primary colors. This was introduced as LV Series AQUOS
Quattron 3D LCD TVs (20).
2. Historical Analysis of Consumer Electronics Industry
Sharp Corporation is part of the Consumer Electronics industry. Consumer electronics is
based on electronic devices used most often for communication, entertainment, home and office.
Sales of electronic products in the United States grew from some $200 million in 1927 to over $2
billion in 2000. The new U.S. Consumer Electronics Sales and Forecasts report projected that
total industry revenue will reach a record $211.3 billion in 2014; a steady, two percent increase
from $207 billion in sales in 2013 (35).

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Best Buy is the largest consumer electronics retailer in the world; selling a variety of
brands of electronic devices such as cameras, mobile phones, computers, televisions, appliances,
video games etc. also repairing and installing the devices. Richard Schulze founded Best Buy in
1966. Best Buy has more than 1,400 stores and locations, employs around 140,000 and earns
more than 40 billion dollars in revenue (21). They have around 1,100 stores in the United States,
and around 490 international Best Buy stores (22). Best buy acquired Carphone Warehouse and
The Phone House, which are two European retail store chains focused on mobile phones and
accessories (22). After that they operate about 2,390 mobile stores in Europe and 305 mobile
stores in the United States (22). Circuit City was the only significant direct competitor to Best
Buy, since they went bankrupt, this stimulated competition among big retail chains including
Walmart, Costco, and Amazon. Best Buy is concentrating on advancing its marketing strategy to
“more targeted, personalized and relevant customer communication, including the shift away
from traditional TV advertising to more relevant digital marketing” (22). Best Buy wants to
accelerate the growth of their online segment by making this their main focus and update its
website to get on par with Amazon and other competitors (23). They are aiming to reduce its cost
of goods sold by increasing its supply chain efficiency and modifying its return and replacement
policy (23).
Amazon is one of the biggest Internet based companies in the world based on revenue
and number of employees. This company industry is Internet and catalog retail, but being part in
one of the biggest retailers in consumer electronics. Amazon is a strong competitor of Best Buy
as mentioned before. Jeffrey Bezos founded Amazon in 1994 in the United States; employing
around 117,300 people and having sales of 74.45 billion dollars (24). The company operates in
two principle segments: North America and International (24). The North American segment

34 | S h a r p
consists of retail sales of consumer products and subscriptions through North American-focused
websites (24). The international segment consists of retail sales of consumer products and
subscriptions through internationally focused locations (24).
Walmart is another big retail store for consumer electronics. Sam Walton was the founder
of Walmart in 1962. Each week more than 245 million customers visit their 11,000 stores in 27
countries, having 473 million dollars in sales. Walmart employs around 2.2 million people (25).
Walmart’s strategy is to offer the best prices, being lower than any other retailer “the big box
retailer has started offering a number of large discounts on consumer electronics, and the
company’s executives are hoping that the price cuts will help drive stronger sales, ultimately
resulting in more encouraging earnings” (26).
There have been many big and important creations in the consumer electronic industry
through the years. Some of the biggest inventions have been the telephone, radio, mobile phone,
computers and others. The telephone was one the biggest inventions. Alexander Graham Bell
was the inventor of the telephone in 1876, he was granted the first official patent for his
telephone. Bell had the idea in 1874 as he explained that his thoughts were “If I could make a
current of electricity vary in intensity precisely as the air varies in density during the production
of sound, I should be able to transmit speech telegraphically” (27).
The invention of the radio was one of the big inventions of this industry. It all started
with the German physicist Henry Hertz when he discovered the radio waves and also gave the
methods to transmit and detect them (29). Then Guglielmo Marconi developed, demonstrated
and marketed the first successful long-distance wireless telegraph and in 1901 broadcast the first
transatlantic radio signal (28). His company’s Marconi radios ended the isolation of ocean travel

35 | S h a r p
and saved hundreds of lives, including the passengers who survived from the sinking Titanic
(28).
The invention of the television was another big one in the consumer electronics industry.
In 1884 Paul Gottlieb Nipkow patented the first mechanical television, which included a
scanning disk and a spinning disk (30). In 1926 John Logee Baird transmitted monochromatic
images, by doing that he created the first true television that could transmit silhouettes and
monochromatic images (30). In 1927 Philo Farnsworth transmitted an image through the
electronic means of a device called an “image dissector”, this was the first all-electronic
television (31). In 1936 BBC transmitted the first public TV broadcast; it claims to be the
birthplace of TV broadcasting (30). Robert Adler was the inventor of the TV remote control in
1956 (30). In 1962 AT&T launched the first television satellite, people could watch the same
channel even if they are 1 million kilometers apart, this was one of the events that started the
Modern Television Era (30). The introduction of General Electric's compact and
lightweight Porta-Color set in 1966 made watching color television a more flexible and
convenient proposition. In 1972, sales of color sets finally surpassed sales of black-and-white
sets (30).
The mobile phone was a huge change to the world and the consumer electronics industry.
In 1973 Martin Cooper and his team at Motorola developed the mobile phone, which was the
size of a brick, that would not be sold commercially sold for another decade (32). In 1989 the flip
phone was introduced, Motorola came out with a new design where the mouthpiece flipped over
the keyboard. In 1993 developers in Europe came up with a way to send written messages over
the mobile phone (32). The first smartphone is invented which could send and receive emails in
2002; also a company called Sanyo invented a phone that could take pictures. In 2007 Apple

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released their IPhone that changed the cellular industry, since it featured a touchscreen and
allowed users to do almost anything they could do from a home computer (33). Now there are
many companies who have many different types of mobile phones.
Computer was another of the big inventions in the Consumer Electronics industry. The
first and most famous computer was the Electronic Numerical Integrator Analyzer and Computer
(ENIAC) was built by the University of Pennsylvania to do ballistics calculations for the US
military during World War II (34). In 1974 a company called Micro Instrumentation and
Telemetry Systems (MITS) a computer kit called the Altair (34). Years after Steve Jobs and
Stephen Wozniak built a homemade computer that would change the world the Apple I, it was
more sophisticated than the Altair; it had more memory, cheaper microprocessor and a monitor
with a screen (34). After that they made the Apple II that had a keyboard and color screen (34).
As time passed they kept improving the computers and now there are many companies who
make computers.
3. Historical Analysis of Key Competitors
Competitor #1 – LG Electronics
LG Electronics was established in 1958, and was known as GoldStar was born as Koo In-
Hwoi saw the possibility of a new business in the electronics industry (PDF5, p.12-24). In 1959
before the inauguration of the company GoldStar’s design laboratory had already started
designing the new radio model (PDF5, p.12-24). In November the first domestic radio A-501
was designed. In 1960 they developed its second radio T-701 which was beyond the vacuum
tube, using new technologies, but it was a disaster since the market demand was very limited, it
put the company’s existence at stake (PDF5, p.12-24). They had to consider whether or not to
keep the company in 1961. They found a way to enter the market since 5.16 military government

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announced its decision to supply radios to rural and farming areas. Sales of radio rose to 1
million (PDF5, p.12-24). The company was recording 1,034,00 in 1962 in sales (PDF5, p.12-24).
Also this year was the first domestic radio exports.
In 1964 Korea’s first electronic appliances were monochrome TVs, air conditioners,
refrigerator, and others (PDF5, p.12-24). GoldStar introduced Korea’s first television in 1966
(PDF5, p.12-24). The Korean electronic industry was taken to another level. The year 1968 was
when the first air conditioner came out of the assembly line (PDF5, p.12-24). In 1969 the first
washin machine nicknamed White Swan was created; this was an event, which impacted Korean
housewives lifestyle (PDF5, p.12-24). GoldStar declared its Communication division an
independent business and established the GoldStar Communications subsidiary, also the Wiring
division was separated from the company to establish the GoldStar Cables subsidiary (PDF5,
p.12-24).
LG introduced the first cassette recorder in the market in 1973. They developed a variety
of models including one that combined radio, television and a cassette tape recorder (PDF5,
p.12-24). GoldStar was the first to establish a central research laboratory in 1975 that was
dedicated to technology enhancements (PDF5, p.12-24). In 1976 they developed their first color
TV. The company established Korea’s first overseas local production subsidiary GoldStar
America, Inc in 1980 (PDF5, p.12-24).
In 1991 the company further expanded its industrial design contest global-wide,
contributing to the growth of the international design industry (PDF5, p.12-24). In 1994 GoldStar
officially announced the merge and acquisition of the GoldStar Communications as part of the
company’s comprehensive management plan toward the 21st century. In 1995 they renamed the
company to LG Electronics (PDF5, p.12-24). Korea initiated the world’s first CDMA platform-

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based digital mobile service in 1996 (PDF5, p.12-24). LG Electronics entered the CDMA market
with its new LDP-200 mobile phone. LG developed Korea’s first 40-inch plasma display panel
in 1997, showing their advanced digital technology (PDF5, p.12-24). In 1998 LG Electronics
developed and unveiled the world's first clutch less Turbo drum washing machine targeting the
worldwide market (37). LG Electronics and Philips joined to launch their joint venture in 1999
(37). With that LG Electronics was able to reinforce its financial structure and secure resources
to invest on businesses. In the year 2000 LG Launched the world's first Internet
refrigerator Exports synchronous IMT-2000 to Marconi Wireless of Italy (37).  Also having the
products exported to Verizon Wireless in U.S. In 2001 GSM mobile handset Exports to Russia,
Italy, and Indonesia, they also established market leadership in Australian CDMA market (37).
Also that year LG launched the world's first Internet washing machine, air conditioner, and
microwave oven (37). In 2002 LG Holding Company system separates into LG Electronics and
LG Corporation (37). The year 2003 was a big year they achieved monthly exports volume
above 2.5 million units (37). They were the top global CDMA producer (37). The year 2004 was
a big year for LG; they commercialized the world’s first 55 inch all-in-one LCD TV and also
commercialized world’s first 71 inch plasma TV (37). They also developed the world’s first
satellite and terrestrial-DMB handsets. In 2005 they became the fourth largest supplier in the
mobile handsets market worldwide (37). In 2006 the first model in LG’s Black Label series of
premium handsets sells 7.5 million units worldwide (37). From 2000 to 2007 they were the
world’s largest air conditioning unit manufacturer (PDF5, p.12-24).
They posted the number one spot in U.S. frontloading washers in five consecutive
quarters in 2008 (37). Also they unveiled the world’s first Bluetooth headset combined mobile
phone and also the first Blue-ray network storage (37). They recovered over one hundred million

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units of LG air conditioners in accumulated sales (37). The year 2009 was a great year for them
as they became the second largest LCD TV provider worldwide and the third largest supplier of
mobile handsets market worldwide (37). They also became Global Partner and Technology
Partner of Formula One (37). In 2010 they unveiled the world’s first and fastest dual-core
smartphone and they also unveiled the world’s first full LED 3D TV, entering the smartphone
market (37). In July 2010, LG Group was ranked 67th in the Fortune 500 list of largest
companies with revenue exceeding $100.5 billion, operations in over 60 countries, and
employing approximately 186,000 worldwide (37). In 2011 LG introduced Cinema 3D Smart TV
combining industry-leading 3D technology and smart TV capabilities. (37)
Competitor #2 – Panasonic Corporation
Note: Panasonic from 1918-2000 is from Panasonic’s website unless otherwise noted. (38)
Panasonic was founded in 1918 by Konosuke Matsushita with three employees in a small
two story building in Japan. The initial idea by Matsushita was to tap into the untapped market of
high quality household electrical fixtures. These were of higher quality and cheaper than any
competitor offered. In February 1920 Matsushita had a company trademark of an M overlaid
with an arrow and surrounded by a wide diamond. It was meant to symbolize reaching a target
and driving through all obstacles in the way. One such obstacle was keeping up with demand.
This was overcome in 1922 when the company leased a site nearby their two-story building to
work as a factory and office. This resulted in more than 50 employees working for the company
by year end.
Around this time Matsushita developed a bullet-shaped bicycle lamp, called Excel, which
soon became a major product for Panasonic. The Earthquake near Tokyo in 1923 demolished
their sales network, but in 1924 Tokyo established a new office rebuilding the sales network.

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Shortly after that Matsushita signed a three-year exclusive sales agreement with Yamamoto
Trading Company for their Excels. This deal had tension as Yamamoto rejected Matsushita’s
attempt to guide the marketing of Excel. A new square-shaped battery lamp was developed, later
called the National, by Matsushita during this agreement with Yamamoto. He had to fight with
Yamamoto for the rights to marketing this new product, and ended up paying ten thousand yen to
market his own product. The product began marketing in April 1927 and was a massive success
selling 30,000 units a month in their first year.
These early successes were accomplished by risky campaigns from Matsushita in which
he put the company’s future at risk by providing free initial orders to stores to prove the product
would work. In 1927 the company began moving into products that produced heat through
electricity. They hired Tetsjiro Nakao as head or their research and development division, he
would stay until his death in 1981. Nakao is largely responsible for turning Panasonic into a high
quality technology company. In 1929 the company was renamed to Matsushita Electric
Manufacturing Works. This was followed by the stock market crashing which created an excess
amount of unsold stock. Matsushita halved production and did not lay off a single employee.
After two months the excess inventory was gone and demand had recovered.
In 1930 Panasonic began working in a joint venture to manufacture quality radios, which
by 1931 Matsushita himself took over the partnership and instructed Nakao to develop a higher
quality radio. The product was made and was recognized as one of the best radios of the time. In
1932 Matsushita announced a new mission to help overcome poverty that would take 250 years
to complete. The mission would consist of ten 25 year periods in which it would start with a ten-
year “construction” phase followed by a ten year “fully active” phase, finishing with a five year
“fulfillment” phase. They also began exporting this year. In July of 1933 Matsushita moved the

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Head office and factory complex to a new 70,000m2 facility in northeast of Osaka to
accommodate the growing demand for their products. Matsushita devised a system to
autonomously manage corporate divisions that was innovative for the time.
By 1935 the company employed 3,500 people, and twelve million yen in revenue. In
1938 the company began importing. When the Pacific war broke out in 1941 the company had
continual issues getting commercial products. In 1943 the company began building ships and
airplanes for the military effort. This was conducted by orders from Japan, and would cost the
company greatly after the war. In 1945 after the bombs dropped the employee roll dropped to
4,400 from 26,000. Panasonic lost 32 factory and office facilities in Japan. Overseas factories
and sales outlets were confiscated. However, the head office and main factories were still
standing and under Matsushita’s control. The company was forced to rebuild.
In 1946 the Allied Powers were forcing Matsushita to step down because of his help with
the war efforts. However, in 1947 the Allied Powers reversed their decisions when the
company’s labor union declared that Matsushita was a mainstay and that his loss would mean the
destruction of the company. This was contrary to what most labor unions in Japanese companies
believed of their management. In addition to the fight to keep their management, the company
also had to fight to get help with recovery. From 1945 to 1950 Panasonic was classified as a
family-controlled industrial and financial combine, which would get no relief from its huge
wartime debts. This designation was supposed to be in place to break up businesses with power
that had been around for generations. In 1950 the designation was lifted.
After these issues Panasonic laid off 567 of its 4,438 employees; one of the few layoffs in
the company’s history. Then in 1951, Matsushita announced his plans for reconstruction as
global instead of just focusing nationally. He then went on a three month tour of the US getting

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to understand the world’s most successful economy. He identified he needed a technical partner
in the US. This partner he determined was Philips. This partnership led to the establishment of
Matsushita Electronics Corporation in 1952 and a factory in Takatsuki, Japan. The company
began production of washing machines in 1951. Research and development of TV technology
was restarted in 1950, they were on the market by 1952. In 1953 the company began selling
refrigerators and built a new laboratory to conduct new research on modern products. In 1956
Matsushita announced a bold five year plan to quadruple annual sales to eighty billion yen and
increase employees from 11,000 to 18,000. This was achieved in four years.
In January 1961 Matsushita announced his resignation as president and took a lesser role
as a chairman handing control to family member Masaharu Matsushita. Then the company began
providing technical assistance to companies that needed it to combat poverty as the founder
continually brought up as part of the mission. In 1965 the new President Matsushita developed a
plan that was accepted within the company for a new national sales network. This began with a
nationwide reorganization of the sales company network, initiating direct transaction and
bypassing sales offices, and creating a new credit sales system. In addition Panasonic became
Japan’s first major manufacturer to introduce a five day work week. The Panasonic’s sales
department began to feel a push for sales companies to find what the customer wanted; this lead
to a succession of hit products and rapid expansion such as console stereos, an automatic
washing machine, and a console TV in 1965. In 1967 President Matsushita announced the
company’s first management slogan that contained three goals; “promote management to make
the company outstanding in world-class terms, to make creative efforts to double productivity,
and to develop innovative new products based on cutting-edge technology” (39). The next year
was the 50th anniversary in which Panasonic grew in sales 34.5%. This was partially due to the

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multiple technology exhibitions they attended and would continue to attend in the coming years
that have helped enhance public awareness of Panasonic as a high-technology company.
In 1970 Panasonic held an Expo that resulted in a time capsule visited by seventy-six
million people and containing 2,098 objects representative of the current culture for people living
5,000 years in the future. In 1971 in an effort to become more globalized Panasonic registered to
trade its share on the New York Stock Exchange. In 1973 Chairman Matsushita retired and left
Arataro Takahashi as the new chairman. The company made donations to social welfare projects
totaling five billion yen in Japan to commemorate the event. Then in 1977 President Masaharu
Matsushita replaced Takahashi as chairman, and Toshihiko Yamashita became the new
president. Yamashita began immediately recovering profitability and maintaining profit margins.
Yamashita stayed and was instrumental in developing a VHS department, but by 1986 resigned
to a senior adviser position letting Akio Tanii become the President while Japan was in a
recession.
In 1987 Tanii began pushing for better product design that responded to human need
combined with advanced technologies. This was also the year they adopted a unified accounting
year for the Panasonic group. Tanii also signed the first agreement with China in the post-war
period in which they would create picture tubes for color TVs. On April 27, 1989 the company
founder Konosuke Matsushita died at the age of 94. MCA was bought by the Panasonic Group in
1990 to work together on new electronic entertainment technologies in both hardware and
software. Panasonic had the audio and video technology, and MCA had the software resources
that could be combined to create better profitability. In 1991 Panasonic adopted the
“Environmental Charter” that says to adopt the latest environmentally-friendly technologies and
processes. All of Panasonics operating units are responsible for following this charter. In 1993

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Tanii stepped down and Yoichi Morishita was appointed President. This same year Philips was
bought out of their agreement by Panasonic ending a 40 year partnership. In 1996 Panasonic
released the lightest mobile phone yet; venturing into the expanding cell phone market. In 1998
Panasonic got an early lead on the industry by releasing digital television sets and reception
adapters compatible with all broadcast formats. This was followed by digital HD television sets
in 2000.
In 2000 management was replaced President Morishita with Senior Managing Director
Kunio Nakamura, implementing a new plan emphasizing what he called the 5 S’s; speed,
simplicity, strategy, sincerity, and smile. The company was beginning to lose the public’s trust,
and was attempting to get it back by reorganizing in 2003. Part of this was unifying the brand
under Panasonic to create global recognition of their products.
In 2004, Panasonic began an expansive partnership with Matsushita Electric
Works. The union of this joint venture initiated a new corporate group with significant
management resources. The 21st century has brought about more global competition and
therefore consumers demand products and services catered to their changing values and
increased reliance on technology and networks. By the end of 2004, the combined companies
operations released the first set of “Collaboration V-products,” including toilets, kitchenware,
and furniture (38). “Products…featured a combination of Panasonic Corporation’s energy-saving
and resource-saving technologies, user-friendliness that had been spawned by research results,
and Matsushita Electric Works’ space design technology and home solutions competency. This
was followed up by collaborative products in areas such as home safety, open area security, and
lighting” (38). The joint operations between Panasonic and Matsushita Electric lead to growth
and domination in the car navigation system market, which was boosting their revenue and

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profits (40). “Car-navigation sales make up 40% to 50% of $4.2 billion of revenue at
Matsushita's car electronics unit, Panasonic Automotive Systems. The subsidiary accounts for
6% of Matsushita's total group sales” (40).
Leading into 2005, Panasonic reached further to achieving a milestone of becoming the
number one share of plasma TV sets. “The Amagasaki Plant (the Third Domestic Plant), the
world's largest plasma display panel (PDP) plant, started operations in September 2005. By the
end of November, the plant achieved full manufacturing performance of 125,000 units monthly
in the first phase of operations” (38).
This was part of Panasonic’s efforts to accomplish their “Leap Ahead 21 Plan” starting in
2004, under President Nakamura. The plan, with the mission statement of “De-coustruct &
Create,” achieved the goal of “global survival levels,” where there was an operating profit ratio
of 5% or more and consolidated CCM of 0 or more (38). However, during this installation of
these goals, Senior Managing Director Fumio Ohtsubo took over as president of the company
and Nakamura moved into the chairman position. Ohtsubo declared that his mission as carrying
the brand name to be a representative of global excellence. “President Ohtsubo redefined [it
as]…making Panasonic into a company supported by stakeholders the world over by maintaining
innovation that is unyielding and implementing sound business activities on a global scale” (38).
Ohtsubo prompted a company that incorporates the strengths of each employee into a flowing
sequence of operations that leads to the manufacturing of goods and services that are strong and
reliable.
In the following year, a fourth plant was built and the total plasma display production
(PDP) reached a combined monthly tally of 460,000 units. In January 2007, the new mid-term
plan was announced: continue “steady growth accompanied by profits” to win the right to

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challenge for “global excellence” by 2009” (38). The construction of a Fifth Plant was
announced at the end of 2007 and would become operational by 2009. “In January 2008, the
latest panel technology was displayed at the Consumer Electronics Show held at Las Vegas,
USA. The cutting-edge and original technology of Panasonic Corporation revealed a significant
increase in the luminous efficiency of plasma panels, creating a huge sensation and winning high
accolades” (38). There was greater emphasis on panel displays that were thinner and larger
along with high definition and energy-saving features.
Ohtsubo’s idea of global excellence was more than just profitability and company
expansion; it also focused on environmental initiatives. Panasonic stated its “Eco Ideas
Declaration,” where accelerated environmental management. “The goal of paramount
importance was the reduction of CO2 emissions in manufacturing activities. Panasonic
Corporation has positioned CO2 emissions as a key management indicator along with sales,
operating profits, inventory, CCM, and others” (38). There were three goals that included an
approach to eco-friendly ideas in manufacturing with reducing CO2 emissions and conserving
resources and waste materials. One of those goals was creating energy-saving products and
recycling efforts and finally developing an environmental outreach with the local community as
well as overseas. This overall eco-friendly and environmental initiative increased Panasonic’s
competiveness in the growing market.
Panasonic brought the concept of sterilizing washers in China, in 2007; this was highly
effective here due to consumer preference and Panasonic taking advantage of that analysis. They
were the first big multinational to do so and were able to bolster consumer trust by releasing data
showing the technology’s effectiveness. As a result in no less than a year, the company’s sales
and place in the market for front-loading washing machines went from 3% to 15% in China (41).

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This has stimulated Panasonics to increase their global outlooks. “The company has placed new
emphasis on studying consumer lifestyles in additional markets so that it can continue to create
products that meet specific local needs. In 2009, Panasonic established a lifestyle research center
in Europe (Wiesbaden, Germany) and in 2010 brought similar capacities to India (the Volume
Zone Marketing Research Center in Delhi)” (41).
Since 2008, Panasonic has been attempting to increase its brand recognition. “According
to the CoreBrand Corporate Brand Index®, which has been tracking both the reputation of both
Matsushita and Panasonic brands since 2001, the Matsushita brand has been declining in Brand
Power at a slow but steady rate. Conversely, Panasonic has been growing in Brand Power, just as
steadily” (42). Panasonic’s brand power and recognition had been steadily increasing since 2006,
where brand power was 49.9 and by 2008 they reached 54.3. Panasonic began weighing the
brand with the familiarity and favorability rather than rebuilding the declining corporate brand.
“Much of this brand strength comes from the advertising behind Panasonic’s product brands. For
example, Toughbook has been marketed heavily under the Panasonic brand name…appeal to
public safety and emergency personnel and the advertising is quite effective in standing out in a
crowded field” (42).
Panasonic’s announcement in 2009 stated that they would restructure their motor
division, they hoped for strength in its management that would lead to further growth.
“Panasonic aims for further strengthening both finished product manufacture and device
businesses by vertically integrating Home Appliance and Automotive Motor, Industrial Motor
businesses, and finished products, which are expected to create the mutual synergy effects” (43).
Panasonic hoped that this synergy effect would strengthen its business structure. They focused
on customer relations and expanding through energy efficiency in home appliances as well as

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developing innovative automotive motor unit business. “Panasonic will liquidate Panasonic
Motor Matsusaka Co., Ltd., which is Panasonic's subsidiary company, for accelerating
manufacturing at global optimal locations after transferring compact AC geared motors and
industrial brushless motors to Panasonic Motor (Zhuhai) Co., Ltd” (43).
Competitor #3 – Samsung Electronics
Samsung Group was founded in 1938 by Byung-Chull Lee on March 1st (44). Lee started
his business in Taegu, Korea with 30,000 won (44). When the business first began, it primarily
focused on trade exports, selling dried Korean fish, vegetables, and fruit to Manchuria and
Beijing (44). A little over a decade later, Samsung had established its own flour mills and
confectionary machines, as well as its own manufacturing and sales operations (44). Samsung
established Samsung-Sanyo Electronics in 1969 (46). The newly established Samsung-Sanyo
Electronics began production on the Black-and-White television, model P-3202, the following
year in 1970 (44). The first Samsung black-and-white television went on sale in 1970 (46).
The decade of the 1970s brought about change for Samsung in regards to their exports
and market. Samsung Electronics was already a major manufacturer in the Korean market, but
during the seventies the company began exporting their products for the first time (44). The year
of 1972 brought about the production of black-and-white televisions for domestic sale (44).
Samsung Heavy Industries Company was incorporated in the year 1974, the same year that
Samsung Petrochemical was established (44). The company began production on washing
machines and refrigerators (44). Samsung’s black-and-white television market was booming by
1976, and the following year in 1977, the company started exporting colored televisions (44).
The mass production of microwave ovens began in 1979 for Samsung (44).

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During the 1980s, Samsung challenged itself to restructure old businesses and enter new
ones with the overall goal to become one of the world’s top five electronics companies (44). This
was the decade that Samsung began exporting more of its products to North America (46). Air
conditioners were produced by the company at the start of the decade in 1980 (44). The first
microwave ovens, model RE-705D, were exported overseas to Canada in 1981 (44). Two years
later, in 1983, Samsung began its production on its’ line of personal computers (44). The first
video cassette recorders (VCRs) were exported to the United States of America in 1984 (44). The
year 1986 brought about the development of the world’s smallest and lightest 4mm video tape
recorder (44). Samsung opened a new facility in 1987 for research and development purposes –
the Samsung Advanced Institute of Technology (44). This facility was one of the two institutes
that helped Samsung expand its reach into electronics, semiconductors, high polymer chemicals,
genetic engineering, optimal telecommunications, aerospace, and new fields of technology
innovation (44). Founding chairman Byung-Chull Lee passed away in 1987 after running
Samsung for almost 50 years (44). Byung-Chull Lee’s son, Kun-Hee Lee, succeeded him as the
new Chairman of Samsung (44). It was decided in 1988, with the merger of Samsung
Semiconductor & Telecommunications Company, that home appliances, telecommunications,
and semiconductors would become the core business lines for Samsung (44).
In a decade that presented difficult challenges for high-tech businesses due to mergers
and acquisitions, Samsung made the most of any opportunities that it was presented with (44).
Samsung completed the development of their mobile phone handset with the start of the new
decade in 1991 (44). The year of 1992 brought about many new developments for Samsung, as
well as other successfully ventures. The company developed a new mobile phone system, a
250MB hard disc drive, and the world’s first 64M DRAM (44). Samsung also made an

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acquisition of Kukje Securities Company, now known as Samsung Securities Company, Ltd.
(44). Another success for Samsung in 1992, was that the company began manufacturing in China
(44). The following year, the Samsung Advanced Institute of Technology successfully developed
the first-ever digital video disk recorder (DVD-R) (44). The world’s first four-power zoom
camera was developed by Samsung Aerospace in 1994 (44). 1994 also brought about the
development of the first Korean-built electric car (SEV-III) by Samsung Heavy Industries (44).
Samsung continued to introduce world firsts the following year in 1995. The Samsung Advanced
Institute of Technology continued its research success and developed the world’s first ever real-
time MPEG-3 technology (44). The world’s first 33 inch double-screen television was
introduced this year as well (44). The Samsung Entertainment Group was started in 1995 (44).
Samsung began mass producing the 64M DRAMs, originally developed in 1992, in 1996 (44). A
1G DRAM was also completed in 1996 alongside the development of the world’s fastest central
processing unit (CPU) – the Alpha chip (44). In July of 1996, Chairman Kun-Hee Lee, was
selected as a member of the International Olympic Committee which helped to enhance the
company’s image as a key contributor to world athletics (44). 1997 was another year of
successful developments for Samsung including the developments of the world’s lightest PCS,
the world’s largest TFT-LCD, and the world’s first 30-inch TFT-LCD (44). Samsung signed a
contract to become an Olympic Partner in the wireless equipment category for the Nagano
Winter Olympics in 1997 as well (44). The company also became a Worldwide Olympic Partner
in the wireless communications category in the same year (44). They served as an Olympic
Partner at the Nagano Winter Olympics in 1998 (44). Aside from being involved in the
Olympics, Samsung still had continued success in their normal production and everyday
operations. The company developed the world’s first 128MB Synchronous DRAM and 128

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Flash memory and also developed a completely flat-screen television in 1998 (44). Mass
production of the world’s first digital television began this year as well (44). The following year,
Samsung became the first company in the world to mass-produce and offer a full line of digital
televisions (44). The first 3D TFT-LCD monitor was developed by the company in 1999.
Samsung also developed a wireless Internet phone, a ‘Smartphone’, which was a small, multi-
function phone (44).
With the start of 2000, Samsung continued its success as a company into the start of the
21st century. Samsung developed the High Definition Digital television, as well as a unique all-
in-one DVD player (45). Samsung Electronics forms a strategic alliance with Yahoo! in 2000
(45). The company’s TV phone and watch phone make the Guinness Book of World Records for
the year 2000 (45). The Samsung Olympic Games Phone was selected as the official mobile
phone of the 2000 Sydney Olympic Games (45). Samsung also launched their PDA phone with
the start of the new century (45). Samsung was ranked Number One of the world’s top 100 IT
Companies by BusinessWeek in 2001 (45). The company released the industry’s first ultra-slim
handset in 2001 (45). They also developed the world’s first 40-inch TFT-LCD (45). In 2002,
Samsung successfully developed the 54-inch TFT-LCD, which was the world’s largest digital
television monitor (45). A new high-definition TFT-LCD color cellular phone was also launched
in 2002 (45). The company’s brand value ranked 25th in the entire world as of 2003 according to
Interbrand (45). They also ranked fifth on the “Most Admired Electronics Company” list which
was released by Fortune Magazine the same year (45). 2003 brought about the release of the first
HD DVD combo (45). Samsung’s continued success rolled over into 2004 with the production of
the first wrinkle-free steam washer (45). The company developed a 3rd Generation Optical Blu-
Ray Disc Recorder during 2004 and also released the world’s first 46-inch LCD television (45).

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Samsung’s mobile phone sales ranked at the top in Russia in 2004 (45). Samsung became the
official sponsor of the renowned English Premier League football club, Chelsea, in 2005 (45).
The company also ranked 27th according to Fortune Magazine on the “World’s Most Admired
Company” list for 2005 (45). The world’s first seven mega pixel camera phone was released by
Samsung during 2005 as well (45). Samsung developed the first speech recognition phone, the
largest flexible LCD panel, and the world’s first OLED for 40-inch televisions in 2005 (45).
The company’s success was continued into the latter half of the decade with the start of
2006. Samsung developed products like the world’s first real double-sided LCD, the world’s first
50nm 1G DRAM, and a 1.72-inch super-reflective LCD screen (45). The company also launched
products such as the “Stealth Vacuum” – a vacuum cleaner with the lowest level of noises, the
world’s first Blu-Ray disc player, and a 10M pixel camera phone in 2006 (45). As a company,
Samsung held the number one worldwide market share position for televisions for the seventh
year in a row, and was also the number one worldwide market share for LCDs for the sixth year
in a row as of 2007 (45). They also developed the world’s first 30nm-lass 64Gb NAND FlashTM
memory during 2007 (45). In 2008, Yoon-Woo Lee was named as a Vice Chairman and CEO of
Samsung Electronics (45). The company took the number one spot in the United States cellphone
market in 2008, and also launched their OMNIA phone (45). The company also held onto the
number one worldwide market share position for televisions for the 9th straight quarter in a row
(45). Samsung was found to be number one in customer loyalty for the 8th year in a row by
Brand Keys of the United States of America in 2009 (45). The company developed an innovative
hybrid digital camera, as well as the world’s first 40 nanometer DRAM in 2009 (45). Samsung
also released new products into the market in 2009 including the world’s thinnest Blu-ray player

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and the world’s first full HD camcorder with a 64GB SSD (45). Samsung decided to launch a
major restructuring of its businesses starting in 2009 (45).
With the start of 2010 and another new decade, Samsung continued it research,
developments, and success in the industry. The Samsung Galaxy Tab was introduced by the
company to the United States market (45). Samsung Electronics began mass producing the
industry’s first 3D television panels (45). Samsung developed a variety of products in 2010
including the world’s largest 19-inch transparent AMOLED display and the industry’s first 30-
nanometer-class DRAM (45). The company launched the OMNIA 7 which was the first
Windows Phone 7 smartphone (45). Samsung Electronics also launched the world’s first 3D
home theater and the first smartphone based on a Bada platform, WAVE, in 2010 (45).
According to Interbrand’s Best Global Brands, Samsung’s brand value was ranked number 19 in
the world as of 2010 (45). Management announced that as a company, Samsung would be
establishing seven social enterprises over the next three years in order to support the
underprivileged in Korea (45).
Competitor #4 – Sony Corporation
Sony was founded in 1946 as Totsuko in Nihonbashi, Tokyo with start-up capital of
190,000 yen for the research and manufacture of telecommunications and measuring equipment
(47). The name wouldn’t be changed to Sony until 1958 because it became more recognized than
Totsuko, making it easier for people to buy stock on the Tokyo Stock Exchange as it was more
widely recognized (47).
In 1960 Sony established a branch in America and released the world’s first direct-view
portable TV (47). The next year Sony became the first Japanese company to offer shares in the
US on the New York Stock Exchange (47). In 1962 Sony released the world’s smallest and

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lightest all transistor TV (47). In 1965 Sony launched the Chromatron-type 19-inch color TV,
followed the next year by Sony’s first cassette tape recorder (47).
With the color TV market booming in 1970, Sony opened a new plant to assemble color
TV’s in Japan, this is the same year (47). In 1972 Sony opened a new color TV assembly plant in
San Diego, launched a VCR, and established a company to manufacture home video products
(47). The next year they launched a France and Spain branch, and won the first ever Emmy
awarded to a Japanese company for developing Trinitron color TV system (47). These events
were followed by yet another color TV plant opening in Wales the next year (47). The same year
they were officially listed on the New York Stock Exchange (48). Then following that
production expansion Sony launched a home-use ½ inch VCR, the Betamax in 1975
In 1979 Sony launched their first Walkman, beginning their entry into an industry they
would have a stranglehold on for several decades (49). In 1982 Sony launched the world’s first
CD player, which they two years later were able to merge with the portability of the Walkman
and released the Discman, a portable CD player (50). In 1988 Sony launched their first camera
for consumers, followed the next year by a small pocket 8mm camera (47). In 1989 they also
bought Columbia Pictures Entertainment, a movie production company (47).
In 1990 Sony launched an HD TV with the widescreen 16:9 format, one of the first of its
kind (47). In 1993 Sony Computer Entertainment was launched to begin developing the first
PlayStation (51). In 1994 Sony underwent a major strategic restructure of their company. In 1995
Sony introduced the first consumer handheld digital camera, and finished the new industry movie
format, the DVD (52). In 1997 development of “Digital Reality Creation,” technology to create
highly-realistic 4x picture resolution based on standard television signals, using Sony's exclusive

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digital signal processing algorithm, began (47). In addition they released the world's first
broadcast-use HD camcorder (47). This was followed the next year by a flat CRT monitor (47).
In 2001 Sony developed the world’s largest electroluminescent screen (13 inches), and
they opened a Bank in Japan (47). This same year Apple began its attack on Sony and their
stranglehold in the audio industry by releasing the iPod (53). The next year Sony purchased
Aiwa, a Japanese consumer electronics company specializing in audio and visual equipment
(47). In 2003 Sony shifted their organization to a “committee-based model” and launched the
Qualia brand, a high-end consumer electronics brand to showcase Sony’s best technology (47).
Sony then released the world’s first Blu-ray recorder (47).
In 2004 Sony established a financial holdings subsidiary, released the world’s first
consumer digital handheld video camera (47). They also developed a new high-resolution LCD
panel, the industry's first LCD device to meet advanced digital cinema specifications, setting the
global standard for digital cinema projectors (47). Finally, they ended the year developing the
world’s first mercury-free button-shaped battery (47). In 2005 Sony released the world’s smallest
handheld HD video camera, launched a new HDTV flat-screen, and replaced internal companies
with business groups restructuring the business (47). The next year they released the world’s first
Blu-ray disk drive for a notebook pc (47).
In 2008 Sony released a new LCD TV featuring the industry's highest level of energy
efficiency for 32-inch digital LCD TVs (47). In 2009 Sony released the world’s first handheld
camcorder with image detecting capabilities, they entered into an agreement with Sharp to
produce and sell large-sized LCD panels and modules, Sony unveiled the new message “make
believe”, in addition they developed multiple groundbreaking technologies such as a High frame-
rate single lens 3D camera technology, and Highly-efficient wireless power-transfer system

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based on magnetic resonance (47). They later used the 3D technology to come to an agreement
with FIFA to make the 2010 World Cup the world’s first 3D World Cup (54). In 2010 Sony
opened up a 3D technology center in California, introduced the world’s first HD camera with
interchangeable lens, Sony Internet TV powered by Google TV, an e-book reader, and a digital
music service (47).
4. Discussion of Relevant Historical Environmental Changes in the Industry
Macro-environment of the Consumer Electronics Industry
Japanese companies have long been recognized as innovators and current with popular
trends and modern society; however, Panasonic and Sharp have failed to comprehend and
acknowledge the changing and evolving consumer and their interests, where they are spending
their money. This failure to recognize and adapt to consumer change has caused their companies
to suffer greatly and lose revenue.
“Panasonic, Sony, Hitachi and Sharp reshaped how and where the world watched
television. These Japanese companies changed how the world behaves. Most, if not all of these
once invincible brands, are now paddling to stay afloat in turbulent waters…Sharp, Panasonic
and the like are learning the cost of shortsightedness and complacency. These household brands
once owned the consumer’s heart, mind, and disposable income…Instead they compete for table
stakes while Apple and Samsung compete for the adoration of a fervent market and the windfall
of profits that come along with it” (55). These companies failed to analyze the changing market
growth and introduce rapid innovation to compete with new vision and creativity coming from
competing companies.
Panasonic and Sharp continued to design and focus on marginalized strategies that could
not help them withstand the rapid evolving digital age. Bloomberg estimated in 2012 that

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Panasonic and Sharp’s combined market value was down and suffering about $32 billion loss
(56). Sharp was analyzed to have been hit the deepest; it was a company that “once dominated
the liquid-crystal-display TV market promised to make products that others want to imitate. In
the last five years though, its LCD sales have plunged 39 percent. As a result, Standard & Poor
axed Sharp’s credit rating to junk status. In 2012 Panasonic expected to lose $10 billion. It will
only get worse until things get better” (55).
In terms of the future of Japanese consumer-electronics, there is significant evidence that
they are losing their share in the global market. “They all struggle to compete in the most
important categories of consumer electronics against rivals such as Samsung of South Korea and
especially Apple of the United States” (57). The main issue for companies like Panasonic and
Sharp is that they failed to recognize the value and profitability of fast growing, quick software
that companies like Apple feature. These products and services are what consumers are
interested in and have a low-cost manufacturing foundation. Panasonic has recently decided to
step away from their losing markets in TVs and smartphones and focused their resources on
energy efficient products as well as car batteries. This decision is one that will help give them an
advantage in the future and surpass companies like Sharp.
However there is some hope for the future growth for Sharp as well as Panasonic in
greenhouses. “Some electronics giants are moving into a surprising new field: high-tech farming.
Fujitsu, Hitachi, Panasonic and Sharp are converting disused factory space and opening high-
tech greenhouses to grow vegetables, which are expensive in Japan” (57). Another element that
these companies need to conform to solidify success and increase growth, is to de-attach from
their traditional corporate cultures and processes. Companies like Sharp and Panasonic require
the futurist leadership that is willing to take risks and take back their domination in the electronic

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market.
Historical Competitive Forces of the Consumer Electronics Industry
Note: All Information in Historical Competitive Forces were identified by looking at Competitor,
Company, and Industry Historical Analysis Sections
Substitutes posed no threats in the consumer electronics industry. Customers either used
consumer electronics, or they didn’t. The threat of new entrants into the industry was moderate.
Most consumer electronics companies were formed prior to the 1950’s. After that, successful
new entrants became rare because research and development costs were high to start out. The
companies that were founded were constantly looking for new ventures, but there was a lot of
new ground to cover, a lot of new markets. Supplier power was a low threat in the industry. Most
companies developed their products in house, and the parts that were bought were common and
easy to find in other companies. With the constant evolution Sharp’s products went through, they
rarely stuck with specific supplies for long. Buyer power was a moderate threat for the industry.
Only until recently has the market for consumer electronics become saturated causing buyer
power to increase, but for decades the market was expanding with new innovations constantly
coming out. There was limited information on what was available prior to the internet
developing online retailers. What consumers knew, they learned from ads or store clerks. When a
buyer purchased a consumer electronic it used to be an event and a major purchase, allowing for
it to happen only a few times in any given year. The competitive environment of the consumer
electronics industry was a low threat. Buyer Demand was always growing for the latest greatest
product. Few rivals were producing the same product or same things. Most competitors
differentiated themselves. For example, Sharp focused on calculators and solar technology for a
couple of decades, while Sony focused on audio recordings, like the Walkman or Discman.

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Historical Dominant Economic Features for the Consumer Electronics Industry
Note: All Information in Historical Dominant Economic Features were identified by looking at
Competitor, Company, and Industry Historical Analysis Sections
Market Size and Growth Rate
Consumer electronics covers a wide range of things from refrigerators and microwaves,
to televisions and computers. The industry was seemingly growing for almost eighty years before
it showed signs of saturation. The typical life cycle usually didn’t exceed five years before the
21st century, but now they can reach up to twenty.
Scope of Competitive Rivalry
The competition was done on a global scale, with most companies founded in Asian
countries.
Demand and Supply Conditions
It was typically difficult to keep up with demand prior to the 21st century.
Market Segmentation
There are dozens of different segments that have developed within the industry
throughout history.
Pace of Technological Change
Each year companies were coming out with new technologies to compete in the market.
If companies weren’t coming out with multiple new technologies each year, they were falling
behind.

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Works Cited – Section 1
1. PDF1
2. http://www.fundinguniverse.com/company-histories/sharp-corporation-history/
3. http://www.oldcalculatormuseum.com/w-comp31.html
4. http://www.vintagecalculators.com/html/sharp_qt-8d.html
5. http://museum.ipsj.or.jp/en/computer/office/0090.html
6. http://www.datamath.org/Related/Sharp/EL-8130.htm
7. http://www.nytimes.com/1983/12/06/business/us-court-reinstates-japan-tv-dumping-suit.html
8. http://www.sharpusa.com/aboutsharp/companyprofile/sharpandtechnologyhistory.aspx
9. http://sharp-world.com/100th/onlyone/1987L/
10. http://sharp-world.com/100th/chronological/1980.html
11. http://sharp-world.com/100th/onlyone/1989/
12. http://sharp-world.com/100th/onlyone/1989L/
15. http://sharp-world.com/100th/onlyone/1993B/
17. http://sharp-world.com/100th/chronological/1990.html
20. http://www.sharp.eu/cps/rde/xchg/eu/hs.xsl/-/html/100th-anniversary.htm
21. https://corporate.bestbuy.com/about-best-buy/
22. http://www.trefis.com/company?hm=BBY.trefis&#
23. http://www.forbes.com/sites/greatspeculations/2014/08/22/best-buys-q215-sales-to-be-
impacted-by-weak-consumer-electronics-market-but-long-term-prospects-remain-positive/
24. http://www.forbes.com/companies/amazon/
25. http://corporate.walmart.com/our-story/
26. http://wallstcheatsheet.com/business/chop-chop-wal-mart-cuts-more-prices-on-consumer-
electronics.html/?a=viewall
27. http://www.history.com/topics/inventions/alexander-graham-bell
28. http://www.history.com/topics/inventions/guglielmo-marconi
29. http://www.ieeeghn.org/wiki/images/8/87/Routray.pdf
30. http://www.timetoast.com/timelines/the-development-of-television
31. http://www.historyofinformation.com/expanded.php?id=707
32. http://www.cnn.com/2010/TECH/mobile/07/09/cooper.cell.phone.inventor/
33. http://www.softschools.com/timelines/cell_phone_timeline/28/
34. http://www.history.com/topics/inventions/invention-of-the-pc
35. http://www.ce.org/News/News-Releases/Press-Releases/2014/Consumer-Electronics-
Industry-Revenues-to-Reach-Al.aspx
36. PDF5
37. http://www.lg.com/global/about-lg/corporate-information/at-a-glance/history
38. http://panasonic.net/history/corporate/chronicle/index.html
39. http://panasonic.net/history/corporate/chronicle/1968-01.html
40. http://articles.latimes.com/2004/jul/07/business/fi-navigation7
41. https://hbr.org/2012/12/what-panasonic-learned-in-china

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42. http://www.wiglafjournal.com/communication/2008/11/matsushita-out-panasonic-welcomes-
a-new-brand-era/
43. http://news.panasonic.com/press/news/official.data/data.dir/en091102-5/en091102-5.html
44. http://www.samsung.com/us/aboutsamsung/corporateprofile/history06.html
45. http://www.samsung.com/us/aboutsamsung/samsung_group/history/timeline/index.html
46. http://www.businessinsider.com/history-of-samsung-2013-2?op=1
47. http://www.sony.net/SonyInfo/CorporateInfo/History/history.html
48. http://finance.yahoo.com/echarts?s=SNE+Interactive#%7B%22range%22%3A%22max%22
%2C%22scale%22%3A%22linear%22%7D
49. http://content.time.com/time/nation/article/0,8599,1907884,00.html
50. http://ezinearticles.com/?A-Short-History-of-Discman&id=4121904
51. http://www.scei.co.jp/corporate/history/index_e.html
52. http://www.miqrogroove.com/writing/history-of-dvd/
53. https://www.apple.com/pr/products/ipodhistory/
54. http://www.sony.net/SonyInfo/News/Press/200912/09-137E/
55. http://www.briansolis.com/2013/12/the-rise-and-fall-of-sony-panasonic-and-sharp-and-how-
to-survive-digital-darwinism/
56. http://www.bloomberg.com/news/2012-09-09/sharp-faces-crisis-as-mechanical-pencil-
inventor-turns-100-tech.html
57. http://www.economist.com/news/business/21606845-electronics-companies-japan-are-
starting-turn-themselves-around-they-are-shadow
58. http://sharp-world.com/100th/hayakawa/
59. http://www.sharp-world.com/corporate/info/ci/index.html
60. http://www.sharp-world.com/products/index.html

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Section 2 – Current Analysis
Subsection #1 – Company Profile
1. Discussion of Sharp Corporation’s Current Overall Strategy
Sharp has two divisions to their business, their product business and their device
business. Their product business is made up of digital information equipment, health and
environment equipment, energy solutions and business solutions. Their device business is made
up of LCDs and electronic devices. All of their products contribute to their overall strategy to
have an advantage against competitors. However, their strategy focuses on their LCD TVs and
their Energy Solutions business. A company’s competitive strategy deals with the specifics of
management’s game plan for competing successfully. They have to please their customers,
strengthen its market position, counter the maneuvers of rivals, respond to shifting market
conditions, and achieve a particular competitive advantage.
Sharp Corporation has a best-cost provider strategy. Best-cost provider strategies are a
hybrid of low-cost provider and differentiation strategies that aim at satisfying buyer
expectations on key quality, features, performance, service attributes and beating customer
expectations on price. Sharp offers products that will give customers more value for their money
by satisfying their needs and charging them a lower price than their rivals with similar products.
Sharp has strong technical expertise, they conduct Research and Development activities to
develop the technologies needed to constantly create new and improved products (1). They have
been undertaking initiatives to strengthen its energy solutions business; they have increased sales
of residential solar power generation systems based on their expertise and its extensive product
lineup (1). Sharp, through its subsidiary Recurrent Energy, develops and sells its own solar
power generation plants in the US. The company is working towards strengthening its energy

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solutions business further to leverage on the expected growth (1). Sharp's focus on expanding
operations across the value chain is helping them capture the growing demand for efficient
energy solutions and is helping them improve their sales and profitability (1). They are all about
giving their customers the best product they can, with their expertise, for the best price to have
advantage over their rivals.
Strong technical expertise helps the company to get a clear competitive edge in many
applications and regions of the world and helps to create a vertically integrated business model
centered on developing devices with innovative features (1). Sharp developed a super-fast
response (SFR) LCD technology that realizes clear unstressed images in a temperature range (1).
Sharp’ s SFR LCD also developed a proprietary pixel structure and new driving technology for
low-temperature conditions. The company will tap new markets for SFR LCD technology with a
wide range of applications (1). They include digital signage and car monitors for cold regions,
displays for smartphones and watches that can be used in winter sports settings, and monitors for
aircraft that can be used in ultralow temperatures in emergency situations (1). Also the company
developed a highly sensitive sensor system that can detect airborne microorganism such as fungi
and bacteria (1). The technical expertise behind these products has helped to drive costs down
making it possible for Sharp to offer similar products to the competitors at lower prices.
As the textbook mentions that when a company can incorporate appealing features, good
to excellent product performance or quality, or more satisfying customer service into its product
offering at a lower cost than rivals, then they have the “best-cost” status – it is the low cost
provider of a product or service with upscale attributes. Also they are a well-known brand they
have a good brand image, that will obviously give them competitive advantage over their rivals.
Being a well-known brand is not an easy task, but Sharp has a level of brand recognition that

64 | S h a r p
they have worked for years and competed for among other consumer electronics companies.
Sharp’s brand recognition gives them the ability to stick out amongst other companies providing
lower cost products like Sharp, keeping with the Best-Cost Strategy. Using this strategy they can
use its low cost advantage to underprice rivals whose products or services have a similar upscale
attributes and still earn attractive profits.
2. Discussion of Sharp Corporation’s Current Competitive Advantage in the Industry
Competitive Advantage: Years of Researchand Development
Sharp’s biggest competitive advantage is the years of experience they have invested in
Research and Development. As evidenced in Sharp’s history they have been identifying and
developing unique technologies throughout Sharp’s entire history. Their focus has varied from
calculators, to solar cells and LCD’s just to name a few. They have dropped research on more
technology than other companies have ever researched. Sharp’s unique knowledge in consumer
electronics has them uniquely positioned to develop the next great technology.
3. Discussion of Sharp Corporation’s Current Strategy Relative to the 3 Tests of a
Winning Strategy
The three tests of a winning strategy are used to decide if the strategy fits the company’s
external and internal situation, build sustainable competitive advantage, and improve company
performance.
1. How well does the strategy fit the company’s situation?
Sharp’s best-cost provider strategy of offering their consumers more value for their
money by satisfying their needs and charging them a lower price than their rivals with similar
products. The strategy fits the company’s external situation since the consumer electronics
industry is a big and highly competitive industry. Since in this industry one of the hardest things

65 | S h a r p
is to create brand recognition, but Sharp already has strong brand recognition all over the world.
They’ve achieved this by being in many international markets. Sharp strategy fits perfect for the
external situation since they are providing good quality products for a good cost among their
competitors to give their consumers value for their money.
Best-cost provider strategy also fits the company’s internal situation since they have
strong technical expertise. They are working on creating and innovating the best products for
their consumers in order to have a competitive advantage over their competitors. Being a best-
cost provider they are matching their strategy to their internal resources and capabilities. The
company’s situation fits the strategy since they are known internationally and being in a big
industry with many competitors they have to have a strategy that will make consumers choose
their products instead of their competitors. By being the best-cost provider and giving their
consumers a good product for an affordable price.
2. Is the strategy helping the company achieve a sustainable competitive advantage?
Being in the Consumer Electronics industry and achieving a sustainable competitive
advantage is a very difficult thing to do. There is a lot of competition in the industry and all of
the companies have their own advantage. For Sharp their strategy is a good way to make
consumers choose their products over others products. Since in the industry most of the people
are not brand loyal they just want to get a good product with good quality for a good price their
strategy is a good way to get consumers to buy their products. Sharp’s LCD technology is one of
the leading technologies now in the market. They also sell some of their products to other
competitors for them to integrate into their own products. Sharp is doing a good job with their
products quality with their strong technical expertise.

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3. Is the strategy producing good company performance?
The mark of a winning strategy is strong company performance, with two kinds of
performance improvements; gains in profitability and financial strength, and advances in
company’s competitive strength and market standing. Sharp had a step back a couple of years
ago in which they lost a lot of money but now they are successfully recovering. Sharp, which
supplies panels for Apple Incorporation’s iPhone, increased demand from major customers led it
to earn an operating profit of 2.1 billion yen in its LCD panel business after posting a 9.5 billion
yen loss on the unit in the same quarter last year (2). Sharp issued guidance earlier this year for 1
trillion yen in sales from LCD panels for the year to March 2015 (2). They were having trouble
for a while but now they are getting stronger. They have business with Apple which is one of the
biggest companies now around the world, they are selling them panels for their iPhones, which is
a great thing for Sharp since there is a huge demand for Apple’s iPhones. Sharp had a rough time
for some years but now they are producing a good financial performance.
4. Discussion of Sharp Corporation’s Current Strategic Vision / Mission
Sharp Corporation has a business philosophy and a business creed that they, as a
company, follow and implement throughout the various aspects of their company’s strategy.
Similar to the mission statement and vision statement of a company, the business philosophy and
business creed describe the nature and purpose of a business, as well as a company’s potential
future or what they intend to be. More specifically, a company’s business philosophy is what a
company uses to determine how they handle their different aspects of operation (3). It is a deep-
rooted system of core beliefs that provide the reason that a company is in business at all (4). A
business philosophy needs to be specific, meaningful, and has to be something that the company
as a whole can operate by (4). Sharp Corporation’s current business philosophy is as follows:

67 | S h a r p
“We do not seek merely to expand our business volume. Rather, we are dedicated to the
use of our unique, innovative technology to contribute to the culture, benefits and welfare
of people throughout the world. It is the intention of our corporation to grow hand-in-
hand with our employees, encouraging and aiding them to reach their full potential and
improve their standard of living. Our future prosperity is directly linked to the prosperity
of our customers, dealers, and shareholders …indeed, the entire Sharp family.” (5)
The company’s business philosophy focuses on the company as a whole, their employees, and
its’ customers.
Sharp’s business philosophy has a system of core beliefs that they follow throughout the
aspects of their business. Their philosophy is specific and meaningful to the aspects of their
company. Sharp makes it a point to remain dedicated to the use of innovative technology on a
global scale that benefits people throughout the world. The company also makes their employees
an important part of their operations. Throughout the years, Sharp has implemented a variety of
employee programs that not only benefit the company, but have also benefited the employees’
lives. Such programs include the 3G, 1R strategy: Green Products, Green Factories, Green Mind,
and Recycling, (also known as the Super Green Activities), to improve their environmental
practices, using solar power systems throughout their factories and plants to make them
environmentally friendly, the Open Recruitment System where employees could work
throughout different areas of the company, and a program that sent employees inside and outside
of the company so they could gain a wider range of knowledge in the field to apply to their jobs
(PDF1).
Sharp’s focus on the company and its’ employees extends to the company’s business
creed. A company’s business creed is typically part of the mission statement and encompasses

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the company’s philosophy of conducting its business and dealing with its various stakeholders
(6). The business creed can also be used by a company as a guiding strategy for management and
employees in the course of day to day business (7). It often clarifies the objectives that guide an
organization’s behavior and operations (7). A company creed also communicates these
objectives, as well as the organization’s core values and beliefs, to the public (8). Typically
companies that communicate their objectives and values to the public in an effective manner to
the public, often attract committed customers and committed employees (8). The main point of a
company’s business creed is to get the word out to the public and tell the world what it believes
(8). Essentially the business creed of a company is used in order to state a company’s moral
values, and then broadcasts those stated values throughout the company, to its employees, and
customers (8).
Sharp Corporation’s present business creed for the company is:
“Sharp Corporation is dedicated to two principal ideals: ‘sincerity and creativity’. By
committing ourselves to these ideals, we can derive genuine satisfaction from our work,
while making a meaningful contribution to society. Sincerity is a virtue fundamental to
humanity…always be sincere. Harmony brings strength…trust each other and work
together. Politeness is a merit…always be courteous and respectful. Creativity promotes
progress…remain constantly aware of the need to innovate and improve. Courage is the
basis of a rewarding life…accept every challenge with a positive attitude.” (7)
Similar to Sharp’s business philosophy, their business creed also corresponds to every aspect of
their business running from top management down to their customers. Their business creed is
available to the public on through their website, as well as on the front page of their historical
PDF, which is also available from their website. Sharp’s business creed states its moral values as

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a company in a way that is relevant to the aspects of its core business. Their creed serves as a
guiding tool for management and the employees that work for Sharp. With Sharp’s current
business creed, they make it a point to state their moral values, and then broadcast it publically
so that their employees and customers are aware of Sharp’s moral values.
Sharp Corporation’s implementation of their 3G, 1R strategy in October of 1997, helped
to promote a more environmentally sustainable company (PDF1). The implementation of this
strategy by management helped the company focus on key points from the business creed. The
3G, 1R strategy, which stands for Green Products, Green Factories, Green Minds, and Recycling,
but has been renamed as the Super Green Activities, has helped Sharp to gain satisfaction from
the work that they do on top of contributing to society in meaningful ways. Beginning in 1997,
Sharp began moving toward becoming an environmentally sustainable company which meant
that they were shifting their focus towards “green” and “eco-friendly” products. Management
made it a point to shift their business models to a green mindset and transformed factories into
eco-friendly facilities and their products into products that were energy saving and recyclable.
Recycling became a part of Sharp’s eco-friendly and environmentally sustainable company
strategy and was implemented across the company as a whole. The eco-friendly and
environmentally safe factories and products that Sharp was now beginning to produce, on top of
their recycling initiative that was placed into action, helped Sharp make a meaningful
contribution to society and develop satisfaction from the work that they produce, which fits right
along with the business creed of their company.
Sharp Corporation’s current business philosophy and business creed are fitting with the
different programs and strategies that the company has implemented throughout the years. Sharp
needs to continue to focus on the moral values of the company, as well as what benefits their

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employees and customers. Making sure that they keep their moral values public and known to
their consumers and employees will only benefit the company, since their consumers and
employees are generally attracted to companies that make moral values publically known. Sharp
should also continue pursuing to be an environmentally sustainable company through every
aspect of their business because not only does this support both their business philosophy and
creed, but it also attracts customers and makes employees want to work for a company that
makes a meaningful contribution to the society and environment.
5. Identification of Sharp’s Core / Distinctive Competencies
Sharp’s three competencies are its focus on the Energy Solutions Business, high quality
LCD TVs, and constant focus on Research & Development.
Core Competencies:
Strong Focus on Energy Solutions Business:
Sharp’s Energy Solutions business is a core competency for Sharp (10). Sharp has been
researching solar technology since the early 70’s and has built up the knowledge of the market
segment that has helped to make them a leader in the technology of the Energy Solutions
business. They are currently transitioning their solar cell technology into their Energy Solutions
business as they have seen a decline in sales in that division and anticipate a continued drop (11).
Production of High Quality LCD Screens:
Sharp has been developing LCD technology since the 1970’s. The 70’s was when most
consumer electronics companies began innovating LCD technology (12). This is still a major
strength for Sharp because they have multiple decades worth of research into the LCD
technology that is used in their key market segment, TVs. It is this research that has provided
them with the top-of-the-industry high quality screens (13).

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Distinctive Competency:
Constant Focus on Research& Development:
Research and Development (R&D) for Sharp has been a constant for Sharp through the
years (14). They have constantly developed new technologies, spending over ¥130 Billion each
of the past five years in R&D (11). This is where Sharp has its distinctive competency, providing
Sharp with the best chance of improving its business by developing new technologies and
finding untapped markets. A recent example of this is their new Quattron technology that utilizes
four colors in a TV to make the color spectrum more vivid (15).
6. Current SWOT Analysis
Strengths
Production of High Quality LCD Screens:
Strengths Weaknesses Opportunities Threats
Production of High Quality
LCD screens
Sluggish Performance
in Key Products
Increasing Demand for
New Technology
Intense Competition
Diversified Product
Portfolio
Heavy Reliance on
Japanese Market
Expansion into the New
Emerging Markets
Availability of
Cheaper
Alternatives
Constant Focus on
Research and
Development
Quality Issues Lead to
Recalls
Growing Mobile Phone
Market in Asia
Exchange Rate
Fluctuates
Well-Known Brand Import Company
Increasing Demand for
Health and Environmental
Products
Saturated Market
Wide International Market
Presence
Multiple Price Fixing
Lawsuits
Be More Socially
Responsible
Risk of Natural
Calamities
Strong Focus on the
Energy Solutions
Business
Sponsorship of Events,
Sports Tournaments, and
Teams
Sharp SWOT Analysis
Consumer
Confidence Near All-
Time Low

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As evidenced from Sharp’s historical Analysis, Sharp has been developing LCD
technology since the 1970’s. The 70’s is when most consumer electronics companies began
innovating LCD technology (12). This makes it not a specific strength to Sharp, but it is still a
major strength because they have multiple decades worth of research into the LCD technology
that is used to reach their top form of sales. It is this research that has provided them with high
quality screens (13).
Diversified Product Portfolio:
Consumer Electronic companies must have a diversified company to survive with all of
the market segments in this industry, as evidenced by the constant innovation Sharp and its
competitors went through in their history. Sharp has TVs, LCD Monitors, High Resolution
Wireless Audio, Sound Bars, and Sound Systems (16). Under their appliance products they have
three different types of microwaves, and electronic air purification systems for whole rooms
(16). In addition they have a high-end brand called Aquos that has TVs, a phone, and a Smart
Board for businesses or schools. Some of their lesser known products include Projectors, Cash
Registers, Calculators, and Printers (16).
Constant Focus on Research& Development:
Research and Development (R&D) for Sharp is constant with their six different R&D
locations.(14) This is apparent throughout their history as they have constantly developed new
technologies. They have spent over ¥130 Billion each of the past five years on R&D.(11) this is
the 2014 annual report) This is where Sharp has the best chance of improving its business by
developing new technologies and finding untapped markets. An example of this is their new
Quattron technology that utilizes four colors in a TV to make the color spectrum more vivid (15).
Well-Known Brand:

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There are a lot of brands in consumer electronics that consumers don’t recognize. Sharp
is a brand that is widely recognized as a brand of strong performance and quality (17). Sharp
made steps throughout history to impress upon their consumer base that their lives can be
improved through Sharp products.
Wide International Market Presence:
Sharp is involved in countries across the globe spreading their diversified product
portfolio. Sharp has manufacturing plants, sales centers, and marketing in multiple countries on
all six populated continents (18).
Strong Focus on Energy Solutions Business:
Sharp has a subsidiary specifically focusing on Energy Solutions, one of their most
promising divisions (10). This division does audits on energy efficiency for companies along
with offering upgrades for solar, wind, hydro, and school projects (10). They are currently
transitioning their solar cell technology into their Energy Solutions business as they have seen a
decline in sales in that division and anticipate a continued drop (11).
Sponsorship of Events, Sports Tournaments, and Teams:
Sharp has an exclusive deal with the MLB for a sponsorship that provides them with
exclusive advertising rights, and several individual teams in the MLB, NBA, and NFL (19). This
goes a long way to tapping into the sport teams fan base. In addition, they sponsor events like
Memphis in May (19).
Weaknesses
Sluggish Performance in Key Products:
The LCD market is highly saturated and their major focus currently. Sharp is attempting
vertical integration of their LCD products, but has mostly just incurred increased maintenance

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and depreciation expenses as mentioned in note 15 on Sharp’s 2014 Annual Report. They have a
relatively small profit margin between the cost of goods sold and the selling point, and are not
selling enough volume to create a profit (11).
Heavy Reliance on Japanese Market:
While Sharp has an international presence in every market, they rely heavily on their
original Japan marketplace (11). Japan has consistently accounted for roughly half of Sharp’s
annual sales in the past five years (11). This failure to successfully penetrate other markets the
way they have in Japan is a weakness.
Quality Issues Leadto Recalls:
Sharp has issued multiple recalls in the past decade (20)(21)(22)(23). This is a liability
issue that is driving up costs, and damaging the brand image. This is likely a major reason for a
decline in profitability in recent years.
Import Company:
Sharp gets half of their sales from foreign countries, many of which require them to
import their products (11). This drives up the price of their products with higher taxes, making a
less attractive product.
Multiple Price Fixing Lawsuits:
Another liability issue is that Sharp has been accused of being involved in price fixing
twice in the past decade (24)(25). This is another issue that drives up costs, and hurts brand
image. Sharp’s legal issues continue to be a growing concern.
Opportunities
Increasing Demand for Technology:

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Consumers today are always looking for the latest and greatest technology (26). With a
strong enough new technology Sharp has the one of the greatest opportunities to grow their
profitability because of this.
Expansion into the New Emerging Markets:
There is always a new emerging technology market. Currently one of the biggest is
wearable technology (27). If Sharp were to enter this market they could grow profitability.
Growing Mobile Phone Market in Asia:
The Asian Market for mobile phones is growing, and currently accounts for two thirds of
the world market growth in mobile phones (28). It still only accounts for 42% of the world
mobile revenue (28). This is 2.5 Billion mobile phone users (29).
Increasing Demand for Healthy and Environmentally Friendly Products:
There is a growing demand for healthy products this is evident with people turning to
organic food, and health tracking technology (30)(31). There is also an increase in demand for
environmentally friendly technology. This is evident from the increase in businesses going green
(32). Both of these points are made increasingly clear with the extreme popularity of the Chipotle
brand that advertises a green brand with healthy food (33).
Be More Socially Responsible:
Sharp needs to clean up their image from the legal issues they’ve been battling recently.
Socially responsible behavior is a good way to improve a brand image.
Threats
Intense Competition:
The consumer electronics industry is highly competitive because most products are not
brand specific. Each brand has the ability to offer the same product. This has created an industry

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where competitors are consistently trying to undercut each other because there are few options
for differentiation.
Availability of Cheaper Alternatives:
Sharp is not the cheapest TV brand. There are a lot of cheaper alternatives more attractive
than Sharp (34).
Exchange Rate Fluctuations:
With Sharp located in so many different markets they are involved in a lot of currency
exchange. If currency exchange rates were to have an extreme drop in the middle of a trade, it
could create a major loss for Sharp.
Saturated Market:
The products that Sharp gets most of its income from are not unique to Sharp. These
products have been around long enough that the product lifespans have peaked and have now
been saturated.
Risk of Natural Calamities:
There is always a threat of natural disasters that could seriously disrupt distribution or
production of Sharp’s products. They already recently incurred an extraordinary loss because
they had to stop production in one of their plants for an unspecified reason that was out of the
ordinary (11). This would have to be a natural disaster to be referred to as an extraordinary
expense.
Consumer Confidence NearAll-Time Low:
Sharp’s stock is at a price of $2.56 (35). This classifies it as a penny stock. The stock
market reflects consumer confidence which means consumers are not confident in Sharp. A low
consumer confidence is bad for getting investors, and finding people to purchase your products.

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7. General Discussion of the Current State of the Following Components
A. Finance / Accounting Analysis
*Disclaimer: All information from this section of the paper comes from the Sharp Corporation
Annual Reports for fiscal years 2011, 2012, and 2013, unless otherwise noted.
In order to properly analyze a company, a financial analysis should be performed to see
where the company stands. By performing a financial analysis, management will be able to if the
company is performing well and if it has an advantage, as well as if the company seems to be
struggling in certain aspects and does not have an advantage in its industry. Companies often
look at their financials to see where they stand at overall as a company. This can give
management and executives of the company insight as to what they are performing well in and
also what they are performing poorly in. Management can utilize the financials of their company
to improve on what they are not succeeding in.
For the financial analysis, the data in this section has been taken from Sharp
Corporation’s most current annual report, which was taken directly from their website. On the
company’s annual report, the data recorded dates back in most statements up to three years. The
purpose of using these statements is to analyze Sharp Corporation’s financial position. By
analyzing the recent and current financial position of the company, one can determine if the
company is headed in a good or poor direction. The annual report and the financial statements
also provide the information that is necessary to calculate specific financial ratios that will help
to provide a better understanding of the company’s current position within the consumer

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Balance Sheet Discussion
The balance sheet is the first financial statement of Sharp Corporation that should be
analyzed. This statement shows the assets, liabilities, and stockholder’s equity of the company at
a specific date in time. Sharp Corporation refers to the stockholder’s equity section of their
balance sheet as net assets. The Accounting Equation, or Assets = Liabilities + Net Assets,
shows that the company’s assets are equal to the company’s debt obligations and any
investments made by shareholders, as well as any amount that is in the retained earnings account.
By taking a look at Sharp Corporation’s most recent fiscal year, a couple of key thins stand out
on the balance sheet. The current assets of the company, or the most liquid assets that the
company has, equals approximately 1.374 trillion yen for fiscal year 2013. On the other hand, the
company’s current liabilities equal approximately 1.551 trillion yen for the fiscal year. Ideally,
Sharp Corporation, or any company for that matter, wants their current assets amount to be
greater than their current liabilities. This way, the company can use its’ liquid assets in order to
cover its’ current liabilities. By looking at Sharp’s 2013 fiscal year amounts for current assets
and current liabilities, it becomes evident that this is not the case. The company’s current
liabilities exceed their current assets, which means that they do not have the ability to cover their
short term obligations, or will have problems doing so. This may become a problem for the
company if they continue to let their current liabilities exceed their current assets.
Sharp Corporation’s largest asset accounts for fiscal year 2013 include the ‘Machinery,
Equipment, Vehicles, and Others’ account, the ‘Buildings and Structures’ account, and the
‘Trade Receivables’ account. The ‘Machinery, Equipment, Vehicles, and Others’ account has
consistently been the largest current asset for the company during the last three year period. In
2013, the account had a balance of approximately 1.719 trillion yen. With Sharp being an

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international company and producing the amount of products they do, this amount makes sense.
The company has to make sure that all of their equipment and machines are up-to-date with
regulations. Since the company has plants internationally, they have to make sure that there is
enough equipment, machinery, vehicles, etc. for every plant / building that they operate. Adding
all of these costs together for every plant that exists, contributes to why the amount for the
‘Machinery, Equipment, Vehicles, and Others’ account is so high. The ‘Buildings and
Structures’ account for fiscal year 2013 has one of the larger amounts in the assets section of the
balance sheet for similar reasons. With the amount of plants that the company is operating
around the world, the amount for this account is expected to be high so that they can continue
operating and producing the amount of products that they do. The company has building and
structures for all of their plants which makes this number large. The third largest asset account
for fiscal year 2013 is the ‘Trade Receivables’ account which had about 423 billion yen. Trade
receivables are the amounts billed by a specific business, in this case Sharp Corporation, to its
customers when it delivers goods or services to them throughout the ordinary course of business.
Since Sharp has recorded the trade receivables under the current assets section of their balance
sheet, the company is expecting to receive payment from its customers within one year for the
delivery of their goods and services.
The largest liability accounts for fiscal year 2013 include the ‘Short Term Borrowings’
account, the ‘Trade Payables’ account, and the ‘Long Term Debt’ account. The Short Term
Borrowings account for fiscal year 2013 is approximately 793 billion yen. The current assets of
the company for this year would be able to cover the short term borrowings for the company.
The following chart shows what the short term borrowings for Sharp Corporation include:
Short Term Borrowings for Sharp Corporation
Short term borrowings including current portion of long-term debt as of March 31, 2012,

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2013, and 2014 consisted of the following:
Yen (Millions)
2012 (Fiscal 2011) 2013 (Fiscal 2012) 2014 (Fiscal 2013)
Bank Loans 199,085 610,254 626,528
Commercial Paper 351,000 0 0
Current Portion of
Long Term Debt
47,912 313,859 166,670
Total 597,997 924,113 166,670
The weighted average interest rates of short term borrowings as of March 31, 2012, 2013,
and 2014 were 0.5%, 1.8%, and 2.2%, respectively.
The bank loans are the largest portion of the short term borrowings that the company has taken
on. It is important to bring this number down in future years because Sharp does not want to
continue to rely on bank loans in order to continue operations. The ‘Trade Payables’ account is
also a relatively large liability account for the company. Its total for fiscal year 2013 is about 347
billion yen. Trade payables are the opposite of trade receivables in the sense that they are the
amount that is billed to a specific company by its suppliers for any goods delivered or services
provided by the company during the ordinary course of business. Sharp must be expecting to pay
their trade payables of 347 billion yen off within a year because they have recorded them under
the current liabilities section of their balance sheet. The third largest 2013 fiscal year liability
account is the ‘Long Term Debt’ account which is roughly 300 billion yen. Sharp Corporation’s
long term debt could include loans and financial obligations that last over one year. The
company has acquired a number of loans and bonds over the last couple of years, some of which
were due in 2012 and others that are not due until the year 2031. The interest on all of these
debts vary.
Income Statement Discussion
The income statement, also known as the consolidated statement of operations, measures
a company’s financial performance over a certain period of time. This statement essentially

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shows the success that a company has had with its operations. The company’s financial
performance is assessed through a summary of how the business incurs it revenues and expenses
through both operating and non-operating activities. The net profit or net loss of the company is
shown on this statement, which is significant for management to know. Although the equation
for the income statement is relatively simple: Revenues – Expenses = Net Income or Net Loss,
the equation also takes into account a variety of other elements including depreciation,
amortization, interest, and a variety of loss provisions. The income statement can give
management and investors a lot of information about the company, including information about
past performance and what the future could hold.
Sharp Corporation’s income statement shows management and investors that the
company has gone through a rough past couple of years. Fiscal year 2013 was the first time since
fiscal year 2010 that the company was able to sustain a net income. By taking a look at the
income statements for Sharp Corporation from fiscal years 2011 and 2012, one would see that
the company sustained net losses in the billions. Most notably, fiscal year 2012 recorded a net
loss of approximately 545 billion yen. One major contribution to the net losses sustained in 2011
and 2012 was the suspension to the production of large-size LCD panels in the company which
added to extraordinary operating expenses for these two years. Sharp was able to produce a net
income of approximately 11 billion yen for fiscal year 2013. Net sales for 2013 rose 18.1% from
fiscal year 2012, totaling 2.927 trillion yen. The company’s operating income went from a 146
billion yen deficit, to a positive 108 billion income in 2013. After sustaining significant net
losses for two fiscal years in a row, the company’s management decided that it was time for
some changes which in turn impacted the net income the resulted in fiscal 2013.

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Sharp Corporation made it a point to generate and strengthen the sales of their distinctive
devices and original products. Sharp incorporated full-HD panels into their Quattron Pro
Televisions and equipped their smartphones with IGZO LCDs, solar cells, and small and
medium sized LCDs. All of this was done to improve on their products and make them next
generation by incorporating the latest technology. Management made it a point in 2013 to
improve on the company’s business foundation, which included inventory reduction, capital
investment restriction, and radical cuts in overall costs. By doing this the company’s net sales
improved because Sharp was selling products that were not only original to the company, but
also equipped with the latest technology. Also, the company had implemented new business
strategies across the company which reduce inventory, costs, and losses during fiscal 2013. All
of these actions that were taken by the company helped to get Sharp to pull out a net income for
2013.
Statement of Cash Flows Discussion
The statement of cash flows for Sharp Corporation specifically shows how cash is
flowing in and out of the business. By looking at this statement, one is able to see the net change
in cash used in operating activities by the company, financing activities by the company, and
investing activities by the company. The cash flows statement starts off by stating the net income
or net loss for Sharp Corporation, and then adjusts it to reconcile for the net cash that is provided
by any operating activities that happened during the fiscal year. The statement then proceeds into
the investing activities section, followed by the financing activities section. The overall change
in cash and cash equivalents for the fiscal year is shown at the bottom of the statement of cash
flows for Sharp Corporation.

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The largest account on the cash flows statement is the repayments of long term debt
account, which is located in the cash flows from financing activities section of the statement.
These repayments of long term debt are approximately worth negative 289 billion yen. One
reason that this account might have such a high balance is because Sharp maintains long term
debt with their building, equipment, machinery, and vehicle purchases. These company assets are
often long lived, so there is typically a significant amount of debt attached to them.
The last couple of lines on the cash flows statement for Sharp Corporation, show the
change in the cash and cash equivalents account from the beginning of the period to the end of
the period. By looking at these last couple of lines, the company will be able to see the overall
effect that cash had during the fiscal year of 2013. In 2013, cash and cash equivalents had an
increase of around 162 billion yen from the beginning of the year to the end of the year. This
shows that the company had positive cash earnings, which was the first time they did this in a
couple years. Although the company has not had a positive outlook in the past, if Sharp
Corporation continues on the same financial path as they did for fiscal year 2013, then the
company should be okay. If the company can post improving net sales and increase their net
income from year to year, then Sharp Corporation will be in for a healthy financial recovery over
the next couple of years.
Stock Discussion
Sharp Corporation stock was first listed on the Tokyo Stock Exchange in 1956 (36). The
company’s stock had also been listed on the Osaka Stock Exchange since 1949 (36). However,
on July 16, 2013, there was an integration of the cash equity markets of the Tokyo Stock
Exchange and the Osaka Securities Exchange, therefore Sharp’s stock is now only listed on the
Tokyo Stock Exchange (36). The securities code, or ticker symbol, for the company in Japan is

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6753:JP (36). The closing price for Sharp Corporation, 6753, on the Tokyo Stock Exchange, for
December 1, 2014, was 287.00 yen (37). The change in the stock price from the previous day’s
closing price rose 4.00, which translates to a percentage increase of 1.41%. The 52 week high for
the company’s stock price was recorded on January 21, 2014 at 386.00 yen (37). The company’s
52 week low stock price came in approximately 3 months later on April 30, 2014 at 254.00 yen
(37).
The chart above shows Sharp Corporation stock at its 52 week high and low for the past year
(38). The stock price for the company has moved between the two prices, but has stayed
relatively right in the middle of the two prices. Over the course of the past two months, the stock
price for Sharp has unfortunately navigated to toward the 52 week low.
Sharp Corporation has a unique dividend policy. The company considers one of
management’s top priorities to be distributing profits to shareholders (39). The company has
implemented a policy to pay out two dividends annually, a year-end dividend as well as an
interim dividend (39). Sharp’s Board of Directors makes the decision regarding the payment of
the interim dividend, while the year-end dividend is decided upon by the general meeting of
shareholders (39). Cash dividends per share of common stock since fiscal year 2007 are as
follows (39):

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Yen
Interim Year-End Annual
Fiscal Year 2014 0 0 (forecast) 0 (forecast)
Fiscal Year 2013 0 0 0
As shown in the table, no dividends have been distributed or declared by the company since
fiscal year 2011. On the Tokyo Stock Exchange, or when one looks up Sharp’s stock, they will
notice that no dividends are listed. This chart helps to support why. The board of directors and
shareholders have chosen not to declare any dividends for the past couple of years.
Ratio Analysis
Gross Profit Margin
A company’s gross profit margin is used to assess a firm’s financial health by revealing
the proportion of money left over from revenues after accounting for the cost of goods sold. The
gross profit margin serves as the main source of paying for addition expenses and future savings.
The equation for gross profit margin is simple: [(Revenues – Cost of Goods Sold) / (Revenues)].
Taken alone, Sharp Corporation’s gross profit margin cannot give a good indication of its’
financial health as a company. The following chart shows Sharp Corporation’s gross profit
margin for fiscal years 2011, 2012, and 2013:
Yen (Millions)
2012 (2011 Fiscal) 2013 (2012 Fiscal) 2014 (2013 Fiscal)
Net Sales 2,455,850 2,478,586 2,927,186
Cost of Sales 2,043,842 2,218,003 2,396,344
Gross Profit Margin 16.78% 10.51% 18.13%

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Sharp Corporation’s gross profit margin has been relatively steady over the past three years.
There has not been a dramatic jump or drop in the gross profit margin. A stable gross profit
margin for a company is typically a good thing because that means that the company is able to
grow and management can build on the company from year to year. A company’s gross profit
margin needs to be adequate, otherwise the company will not be able to pay its operating and
other expenses which is important. Another important thing to note is that the results of a
company that produces a large range of products, such as Sharp Corporation, will have varying
gross profit margins.
Inventory Turnover Ratio
Inventory is an important part of Sharp Corporation’s business. The inventory turnover
ratio means a lot to them because it tells them how many times the company’s inventory is being
sold or replaced over a certain number of days or a certain period. The equation used to find this
ratio is, Sales / Inventory. Sharp’s inventory turnover for the previous three fiscal years are as
follows:
Yen (Millions)
Net Sales 2,455,850 2,478,586 2,927,186
Inventory 527,483 310,709 295,126
Inventory Turnover 4.66 7.98 9.92
In other words, the company sold its inventory 4.66 times over throughout the course of the 2011
fiscal year, 7.98 times over throughout the course of the 2012 fiscal year, and 9.92 times over
throughout the course of the 2013 fiscal year. Sharp’s inventory turnover ratio has been steadily
improving over the course of the past three years. For fiscal year 2013, Sharp is efficiently
selling their inventory because they are consistently turning over their inventory throughout the

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year at a high rate. The company is effectively selling the inventory that it produces and makes to
sell to its customers around the world. Similar, to the company’s gross profit margin, the
inventory turnover ratio cannot be taken into account alone in order to consider the financial
health of the company. The inventory turnover ratio shows that the company is turning over its
inventory at a very good rate, but other factors have to be taken into consideration in order to
evaluate the overall financial health of the company.
Current Ratio
The current ratio of a company measures the company’s ability to pay its’ short term
obligations. The equation for this ratio is simple, current assets / current liabilities. Sharp would
use this ratio in order to get an idea of their ability to pay back any short term debt and payables
they owe with their short term assets. The current ratio can give the company a sense of the
efficiency of their operating cycle or their ability to turn product into cash. Sharp Corporation’s
current ratios for fiscal years 2011 through 2013 are in the chart below.
Yen (Millions)
Current Assets 1,421,125 1,221,835 1,374,244
Current Liabilities 1,391,080 1,667,533 1,551,625
Current Ratio 1.02 0.73 0.89
Sharp Corporation’s current ratio in fiscal year 2011 was approximately one. However, in fiscal
years 2012 and 2013, the company’s current ratio fell to below one which is unhealthy. Typically
current ratios under one mean that the company would be unable to pay off its obligations or
debts if they became due at that specific point in time. Looking at the current liability and current
asset amounts for both fiscal years 2012 and 2013, one can see that the current liabilities exceed

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the current assets for both years which becomes a problem. However, it is important to note, that
the current ratio did improve slightly from fiscal 2012 to fiscal 2013.
Acid-Test Ratio
The acid-test ratio is similar to the current ratio of a company, however only certain
current assets are taken into consideration in the calculation, unlike the current ratio where it is
the total current asset amount. The equation for the acid-test ratio is as follows: (Cash +
Accounts Receivable + Short Term Investments) / Current Liabilities. The acid-test ratio tells a
company whether it has enough short term assets to its immediate liabilities without selling off
its inventory. The following chart shows the acid-test ratios for Sharp Corporation for the past
three fiscal years:
Yen (Millions)
Acid-Test Ratio 0.47 0.45 0.61
The acid-test ratio results for Sharp Corporation for the past three fiscal years are under one.
Companies that have acid-test ratios under one are unable to pay their current liabilities and will
be looked at with caution because this is not a place where companies want to be. Sharp
Corporation’s ratios for this test are low, which indicates that they have not been performing
where they need to in order to be able to pay off their current liabilities if necessary.
Debt to Equity Ratio
The debt to equity ratio is a leverage ratio that compares a company’s total liabilities to
its total shareholders’ equity. This ratio is a measurement of how much suppliers, lenders, and
creditors have committed to the company versus what the shareholders have committed to the
company. The equation used for this ratio is total liabilities / net assets. Ideally, companies want
this percentage to be lower because that means that their company would be using less leverage

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and would therefore have a stronger equity position. The chart below shows Sharp’s debt to
equity ratios for fiscal years 2011 through 2013.
Yen (Millions)
Total Liabilities 1,969,015 1,952,926 1,974,507
Net Assets (Shareholders’
Equity)
645,120 134,837 207,173
Debt to Equity Ratio 305% 1448% 953%
Unfortunately for Sharp, their debt to equity ratios for the past three fiscal years did not turn out
great percentages. The percentages for the company were very large due to the fact that Sharp’s
creditors, suppliers, and lenders have a lot more money invested in the company than Sharp’s
equity holders or investors. The larger the total liabilities amount is and the smaller the total net
assets amount is, the larger the debt to equity ratio is going to be from year to year. This is the
case with Sharp.
Debt to Assets Ratio
On the other hand, the debt to assets ratio for a company is a leverage ratio that is an
indicator of the proportion of a company’s assets that are being financed with debt versus equity.
Ideally, a company wants this ratio to be lower, just like the debt to equity ratio because the
higher the ratio is, there is a greater risk that the company will not be able to pay back its debts.
The debt to assets ratio for a company is used to determine the financial risk of a business. The
equation for this ratio is simply total liabilities / total assets. The following chart is Sharp’s debt
to assets ratio for the past three fiscal years.
Yen (Millions)
Total Liabilities 1,969,015 1,952,926 1,974,507
Total Assets 2,614,135 2,087,763 2,181,680

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Debt to Assets Ratio 75.32% 93.54% 90.50%
The debt to assets ratios for the last three fiscal years have produced better results for Sharp
Corporation. In all three fiscal years, the company’s shareholders funded more assets than debt.
In fiscal year 2013, 90.50% of the company’s assets are owned shareholders and not creditors of
the company. This ratio provides a positive outlook on the financials for Sharp Corporation
because they were able to have positive results for three straight fiscal years with the same ratio
which is positive for investors.
Asset Turnover Ratio
This equation for the asset turnover ratio is simple, sales / total assets. The asset turnover
ratio shows the amount of sales or revenues generated per dollar of assets. This ratio is an
indicator of the efficiency with which a company is deploying its assets. Ideally, companies
would like for their asset turnover ratio to be a higher value because this means that the company
is generating more revenues per dollar of assets. Sharp Corporation’s asset turnover ratio for
fiscal years 2011, 2012, and 2013 are shown in the chart below.
Yen (Millions)
Net Sales 2,455,850 2,478,586 2,927,186
Total Assets 2,614,135 2,087,763 2,181,680
Asset Turnover Ratio 0.89 1.05 1.16
The asset turnover ratio has improved steadily over the past three fiscal years. There is still room
for improvement for Sharp Corporation, as the company’s overall asset turnover ratio is still
fairly low.
Profit Margin Ratio

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The profit margin ratio is a profitability ratio that is calculated as net income / sales. The
ratio measures how much of every dollar of sales a company actually keeps in earnings. The
profit margin ratio is useful when comparing companies across industries. A higher profit margin
is ideal because it indicates a more profitable company that has better control over its costs.
Similar to other ratios, the profit margin ratio should not be looked at alone. It should be taken
into consideration with other ratios to determine the financial health or well-being of a company.
The following chart shows Sharp’s profit margin ratios for the past three fiscal years:
Yen (Millions)
Net Income (Loss) (376,076) (545,347) 11,559
Net Sales 2,455,850 2,478,586 2,927,186
Profit Margin Ratio -15.31% -22.00% 0.39%
Sharp Corporation’s profit margin ratio is not very promising. For fiscal years 2011 and 2012,
both profit margin ratios are negative because the company sustained net losses during those
years. Unfortunately for the company, since net losses were sustained during those two years,
they were not able to keep any earnings because they did not make anything. Fiscal year 2013
brought about a change. The profit margin ratio for the most recent fiscal year was 0.39%. Even
though this percentage is not as high as the company would like it to be, it is improvement and a
step in the right direction. If the company can maintain a net income and continue to increase its
sales from year to year, it is likely that the profit margin ratio will grow with it.
B. Marketing Analysis
Marketing has to deal with the “four P’s” which are Product, Price, Place, and Promotion.
The marketing analysis of Sharp Corporation will include a detailed breakdown of those four
components. As explained earlier in the paper, Sharp Corporation’s current strategy focuses on

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expanding into the energy industry, particularly solar energy. The next section will address the
current marketing strategy of Sharp Corporation in accordance with their overall current strategy.
Products
Sharp Corporation sells a variety of products across the Unites States and internationally.
The products that Sharp sells are broken down into two divisions: consumer products and
business and industrial products. From here the divisions are broken down into categories, for
consumer products these categories include: audio-visual, home office, mobile, home appliances,
solar, LED lights and plasmacluster (40). For business and industrial the categories include:
office and commercial, solar, electronic components, LED lights, and plasmacluster (40). In each
category the products listed for that category. The audio-visual category includes products such
as TVs AQUOS, blue-ray disc recorders/players and home theatre. The home office category
includes products such as calculators, facsimiles/ multi-functions, electronic diaries, and
telephones (40). The mobile category includes products such as mobile phones/smartphones. The
home appliances category includes products such as refrigerators, superheated ovens, air
conditioners, washing machines, vacuum cleaners, air purifiers, and robotic appliances.
The audio and visual section includes TVs AQUOS, blue-ray disc recorders/ players and
home theater. Some models of AQUOS TVs vary upon availability based on country. Sharp
offers the AQUOS model line domestically, but offers the AQUOS Quattron models only to
ASEAN countries (43). The AQUOS comes in four different models, the AQUOS 4K Ultra HD,
the AQUOS Q+, AQUOS Q, and the AQUOS HD (42). The AQUOS 4K Ultra HD is designed
to ensure that the viewer sees every detail projected through the screen and portray a more
realistic picture. “Ensures that every pixel delivers precisely the scene the director intended”
(42). The AQUOS 4K Ultra HD earned the THX 4K certification going through over 400

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rigorous tests —confirming it delivers accurate images and pristine video performance in every
frame, and ensuring the filmmaker’s vision is recreated perfectly in your home. AQUOS 4K
delivers amazing detail, gorgeous depth, and consistent color for the ultimate viewing experience
(42). The AQUOS 4K is also considered a “smart tv” meaning the TV has built in Wi-Fi
capability, can download open apps, and touch screen technology to name a few. The 4K also
posses SPECTROS rich color display. The AQUOS 4K boasts a 21% wider color spectrum*
than a conventional LED HDTV and produces more vibrant and diverse color, so each frame is
brilliantly recreated as the director intended. With more shades of red and green, you experience
more realistic landscapes, lush nature scenes and natural skin tones. (44). The AQUOS Q+
model is a rise above your standard HD TV. The Q+ has 10 million more subpixels than standard
Full HD TVs, which gives it better detail, depth, and color. It also includes smart technologies
just like the 4K where a person’s favorite apps are just a click away. The Q+ plus posses a
technology called mobile connectivity powered by Sharp’s exclusive SmartCentral 3.0 mobile
app (45). The SmartCentral 3.0 app allows a person to now virtually control everything you do
on your Smart TV, can be done from your tablet or smartphone. Search and discover new
content without interrupting what you're watching and launch it seamlessly. Change channels,
volume or inputs and adjust picture settings. Share videos, pictures, and music from your device
to the large screen (45). The Q+ plus also contain a technology called Miracast. Miracast is a
screen mirroring technology, anything on your smartphone, tablet or laptop can be viewed in
glorious high definition TV without a wired connection (45). The AQUOS Q LED TVs featuring
Quattron technology have 33% more subpixels than standard Full HD, for finer details and a
billion more shades of color (46). The Q also has SmartCentral 3.0 and Miracast technologies
capabilities also comes with all of consumers best apps. The AQUOS HD delivers the highest

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standard of HD picture quality. The HD contains SmartCentral 3.0 and also has the capability to
access a person’s favorite apps (47).
The mobile division is a new interest of Sharp but doesn’t seem to be taking off too well. The
company only offers three models of mobile devices: the AQUOS Crystal 306SH, the AQUOS
phone 3D SH80F, and the SE-02 (41). The AQUOS Crystal emphasizes crystal clear everything
from audio to screen clarity. The AQUOS phone 3D SH80F emphasizes the capability to capture
3D pictures and record 3D videos. This all made possible through their twin-lens 3D camera and
audio stereoscopic LCD screen (41). The SE-02 is fully touch screen and has built in digital TV
to keep its consumer up to date on the latest episode of their favorite shows (48). These phones
are available through the mobile service providers of Sprint, Sprint Prepaid, Boost Mobile, and
Virgin Mobile.
The home appliances division offers a variety of appliances. The first product offered is a
calculator. Sharp offers two different kinds of calculators, scientific calculators and electronic or
standard calculators. The company offers eight different models for the scientific calculator and
twelve different models for their digital calculator, which also come in a variety of colors. This
division also offers facsimiles/ multi-functions, which are products such as laser copying and
printing, scanning and faxing machines. The company offers two multifunction machines and
eight facsimiles. The home office division also offers electronic dictionaries and telephones that
require a landline, but are available in wireless for mobility around the house or office where the
phone is located. The home appliances division offers a variety of products, which are listed
above. Out of these list of products the most interesting product would have to be their robotic
appliance. This robotic appliance is a vacuum that not only vacuums on its own but can talk, and
act as an air purifier using Sharp’s trademarked plasmacluster technology (47).

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Sharp has become very interested in the solar energy industry in the past 50 years,
beginning in 1959 when the company started development of solar cells. As a manufacturer of
products that consume large amounts of electricity the company has always felt it was their
responsibility to create electricity as well (50). The company has vision to fix the problem of
how our lifestyles are endangering our environment and also have the answer to fix this problem.
That answer being the sun, which is a clean, safe, and limitless energy source. The amount of
carbon dioxide being released into the atmosphere by our burning of fossil fuels has created
enough air pollution to be a threat to both the environment and our own health. Global warming
is gradually melting the polar ice caps and causing sea levels to rise. And as our dependency on
harmful carbon-based energy gains speed, the need for a clean, safe, and plentiful alternative
energy source grows stronger (50). Sharp’s answer to this problem is simply the sun. On a clear
day, solar energy of approximately one kilowatt per square meter reaches the Earth's surface.
Harnessing this energy produces no CO2 emissions, it's free, and unlike energy resources buried
beneath the ground, solar energy can be found anywhere (50).
"If we could find a way of generating electricity from limitless solar heat and light, that
would benefit humankind to an extent we can scarcely imagine." Tokuji Hayakawa, founder of
Sharp Corporation (50). The company provides solar panel to many different purposes:
commercial, residential, industrial, public, personal, and special. The purpose of commercial
solar panels range from covering walls of skyscrapers, reduce the air-conditioning load of an
office building, snow melting, and to effectively utilize roof space atop buildings (51).
Residential solar panels are mostly used as a blind to hide outdoor equipment and used mostly on
rooftops of apartment building and condominiums (51). The purpose for Sharp’s industrial solar
panels is to build state-of-the-art super green factories, to build mega solar power plants, and the

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covering factory rooftops with their solar panels. The public purpose of Sharp’s solar panels is to
have entire towns adopt to their solar cells, have government offices use them to show they are
environmentally aware, and for educational institutions (51). The only purpose for personal solar
energy is Sharp’s new solar module for mobile devices (51). Sharp’s special purposes for solar
cells include: the Orihime/Hikoboshi satellites stay in flight with light from the sun, a conversion
rate of 37% high efficiency for use in outer space, and lights powered by solar energy light way
for ships (51).
There are three key points as to why Sharp Corporation excels in Mega-Solar solutions:
Optimal efficiency through system designs, high-quality conservation and maintenance services,
and guaranteed system efficiency (52). For Sharp’s solar energy division they use three key
points gain what they call “total optimization.” This total optimization concept basically means
they see all of their solar energy projects from start to finish. This includes the thorough design
of the system, the maintenance and conservation of entire system. The first key point in Sharp’s
success in Mega-Solar solution s optimal efficiency through systems designs. In this step Sharp
basically designs every aspect of the solar system that is being built. This includes determining
the key factors to maximize the efficiency of a mega-solar power-generation system. These
include the placement locations of junction boxes, inverters, and other related equipment and
facilities, as well as the length of the electrical cables used—a factor that influences power loss
(53). Generally, ambient temperature can by itself greatly affect the number of solar modules
required to produce a given amount of energy at a solar power plant. In hot climates, more
modules are required than is indicated in standard specifications, while in cold climates fewer
modules are required to obtain the same amount of energy (53). All of these factors are closely
examined when the design of the system is being created by Sharp. The next key point to Sharp’s

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success in mega-solar solutions is their high-quality conservation and maintenance services of
the entire system. Once a mega-solar power plant is built the system must run constantly and
stably, through the maintenance and conservation of Sharp this is made possible. Mega-solar
power plants have been built in many different countries and regions. Each area has its own
unique environmental conditions that result in different types and amounts of dust and dirt
accumulating on the solar panels. To achieve stable output requires maintenance and cleaning
that match both the system design and the environment where the plant operates (54). An
important procedure to keep these systems running optimal efficiency is simply to keep them
clean. Along with this cleaning process comes the knowledge of proper timing to do the
cleaning, which Sharp has acquired over the 50 years they have been in the business. To clean
the module surface, Sharp uses specially purified water to remove the kind of dirt that modules
are subject to. This purified water does no harm to the environment (54). In order to provide a
total solar-power solution, Sharp has established its own maintenance company to service power
plants in the long term and ensure that customers enjoy years of sustained power-generating
efficiency. Even after a power plant begins operation, it continues to receive support from this
company in the form of proper maintenance at the appropriate times (55). The final key point to
Sharp’s success in mega-solar solutions is the company’s guaranteed system efficiency. Simply
guaranteeing the output of the individual modules and the related equipment does not guarantee
the efficiency of the overall solar power plant. A total solar-power solution involves
guaranteeing that the entire system will deliver its promised power-generating efficiency (55).
Sharp not only guarantees the solar module the entire system that also includes the whole
systems ongoing efficiency from the plant to the local power grid. Sharp also conducts
simulations that allow them to calculate that the plant is running at it’s full potential or where it

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is set to be running at. Sharp has accumulated valuable data and experience based on more than
50 years of installing and operating solar power equipment in harsh environments such as outer
space, oceans, deserts, and extremely cold climates. That's why we can conduct highly accurate
simulations based on real-world data and provide system-efficiency guarantees for the entire
power plant, thereby minimizing the risk for our customers in the solar business (55).
(55)
The diagram above shows Sharp’s step-by-step procedures the company takes when starting a
new project.
Sharp has developed four different cell types to go along with their solar modules:
Monocyrstalline, Polycrystalline, Thin-Film, and Other. Monocrystalline cells are used in in the
company’s solar modules in space on satellite and in very warm regions such as desert areas. The
Polycrystalline cells are high-efficiency electrically generation, high reliability crystal silicon
solar cells (56). Thin-Film cells are basically the company’s least sophisticated cells developed.
The Thin-Film cells are low cost, see through thin-film silicon that delivers expanded capabilities
and can be used in any place and all types of environments (56). For example the Thin-Film cell
can be used to collect light during the day and then illuminate during the night through LED
lights.

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Promotion
Since Sharp Corporation has been struggling with sales the company is aiming to target
the ASEAN region to boost these numbers in efforts to help company’s performance. The
ASEAN stands for Association of Southeast Asian Nations (57). Countries in the ASEAN region
are expected to play a major role in leading the development of the world market (59) . This area
is expected to see booming demand for consumer electronics and Sharp has already come up
with plans for campaigns and social action programs (58). To compensate for this boom and
higher demand for these products Sharps is planning to build a manufacturing plant in Indonesia,
this plant will be the largest manufacturing plant in the country (58). Due to their focus in the
ASEAN region this is where the company is putting most of their marketing efforts. Sharp has
come up with three major promotional strategies, the first being called “MATSURI”, the second
named “LOVE.LIFE” and the third being a blue service bus (59). The MATSURI campaign is
named after a Japanese festival. In this campaign people dress up in kimonos and carry a display
decorated with lanterns and flags resembling a mikoshi throughout the city (59). While carrying
the displaying the people dressed up in kimonos are dancing to the festive music and the beats of
a drum that would be played at a Matsuri (59). But really the music and beating of the drums is
coming from the display where Sharp television has been placed and on the screen is the playing
of and actual Matsuri festival. This strategy gains the attention of people who stop to look and
begin to gather around the display. This strategy is great because it directly relates the people to
their culture but using Sharp display to make that connection.
In 2013, Sharp launched its LOVE.LIFE campaign in the ASEAN region (59). Through
this campaign, Sharp introduces its value-added products aimed to evoke the love of family and
support the enrichment of their lives (59). The company also included a popular Japanese

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cartoon character for the face of their campaign. This cartoon character being, Doraemon who
represents Japan’s cutting edge technology while he impersonates innovation from the
customers’ perspective and delivers ideas to enrich people’s lives at the same time (59).
The third promotional strategy is best known as the “service bus.” Throughout Indonesia Sharp
has blue buses that go from city to city to repair Sharp products. When the bus arrives at a city
people gather around the bus bringing Sharp products from their houses that need serviced or
replaced (59). Upon the bus opening, the bus also has displays that allow consumers to view new
products that available. Since Indonesia is made up of over 13,000 islands this is way for Sharp
to still provide services to their customers without constructing a physical building on every
island; although the company does have a total of 366 service centers in the country of Indonesia
(59).
In 2013 Sharp did a promotional campaign to boost its customer satisfaction in Japan. To
start the company they started monitoring their customer service assistant center agents and
based on the operators performance depended on whether the agent needed to undergo training to
improve their skills. The skills that were being reviewed are the operator’s responsiveness in
terms of providing assistance that matches the customer’s inquiry, as well as their methods of
speaking and listening (60). This enables the agents to maintain a high level of response skills
while also boosting their awareness of customer satisfaction (60). The next area Sharp turned to
boost their customer satisfaction was their support section of its website. Sharp decided to
enhance this section of their website so customers could solve problems without calling the
Customer Assistance Center. The website now provides enhanced customer-oriented services
that include Fault Diagnosis Navigation, where customers themselves diagnose the symptoms
and solve problems by following instructions on the screen (60). The company also has Visual

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Guide, which employs video images to explain how to maintain products (60). To help solve
common issues that many customers encounter Sharp has a toll-free number that gives
automated responses to help solve the customer’s issues. By doing this, the caller does not have
to wait for the next available operator, which sometimes can be very time consuming. But rather
the customer can fix the problem on their own by listening to a previously recorded operator who
will walk the person through step-by-step directions on how to fix the issues they are facing.
In December 2013 Sharp Corporation launched the “Post Your Comment Campaign” on their
website which was offered to the countries of Indonesia, Malaysia, Singapore, and Thailand. The
Campaign asked two questions based on their plasmacluster ion technology; the first question
being, “ What do you think the Plasmacluster Ion Technology is capable of?” and the second
question being, “What would you like the Plasmacluster Ion Technology to be capable of?” For
question one there were four possible answers to choose from: air can be purified, odors can be
removed, dust can be suppressed, and monsters can be defeated (61). The answer “air can be
purified” got the most response with 686 voices (61%), “odors can be removed” was next with
80 voices (15%), then “dust can be suppressed” with 98 voices (12%), with the least response
“monsters can be defeated” with 61 voices (12%). For the second question there were five
possible answers to choose from: car, refrigerator, hair dryer, robot, and air conditioner (61).
The answer with the most responses was “air conditioner” with 446 voices (41%), next was the
answer “car” with 193 voices (29%), followed by “refrigerator” with 62 voices (12%), then
“robot” with 11 voices (9%), and the answer with the least voices was “hair dryer” with 9 voices
(9%). The percentages displayed above are the percent of the voters who thought this was the
best feature. Over the promotional campaign ran for a little over a year and acquired the attention
of over 1600 voices (61).

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In Australia, Sharp was recently running a promotion where if a person bought one Sharp
product, the customer would receive a bonus gift. One promotion was for if a person purchased
a qualifying Sharp microwave oven the buyer would receive a bonus gift (62). Another
promotion was if a person purchased a qualifying Sharp refrigerator and the buyer would receive
a bonus gift (62). The company also offered a promotion where if a person brought in any
competitor’s product to upgrade to a Sharp product, the company would give that customer a
debit card with an amount of money loaded on it. For example sharp ran a promotion where if a
person brought in a competing product of Sharp’s A3 MFD and upgraded to Sharp’s A3 MFD,
that customer would receive and $250 debit card (62).
Sharp also uses conventions to promote their new, up and coming products. In 2014 the
company debuted its next generation AQUOS BOARD interactive displays at InfoComm (63).
InfoComm is the largest professional AV show in the world. Also at this convention Sharp
decided to showcase their future, value-added commercial displays, which are available in a
wide range of sizes and capabilities (63) Sharp’s booth at the convention focused collaboration in
everyday settings and highlight how Sharp's interactive technology empowers attendees to
Collaborate Your Way (63). "Our booth will show attendees how far interactive communications
and collaboration have evolved by allowing users to share and move content between devices.
Communication has never been easier and these ubiquitous platforms allow for true collaboration
across businesses,” said Mike Marusic, Senior VP, Marketing and Operations. Meaning the
company wants to show off how much they have evolved and how much more advanced they
have become in the electronic world. The company will demonstrate this by allowing attendee
physically operate demos on display for themselves.

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Sharp Corporation uses a total of seven social media network across five major regions to
spread news of the company. The seven social media networks Sharp uses are Facebook,
Twitter, Youtube, Google+, Pinterest, Webchat, and Weibo (64). The major regions where Sharp
uses social media networks are North America, Asia, Europe, Australia, and the Middle
East/Africa. In North America Sharp uses the social media networks: Facebook, Twitter,
Google+, Youtube, and Pinterest. In Asia the company uses Facebook, Twitter, Youtube,
Webchat, and Weibo social media networks. In Europe the company uses three social media
networks: Facebook, Twitter, and Youtube. In Australia the company on uses Facebook. And in
the Middle East/Africa the company also only uses Facebook (64). In each region the country
may be promoting or advertising different products, some of the products of which aren’t even
offered in the other countries.
Price
When a company is approaching marketing any product a major marketing strategy
element is setting the right price for that product. If the price of a product is set too high or too
low for the target market then this result in a negative effect on the sales of the product. Other
major elements that share a key role in what pricing strategy should be used are: target market,
profit margin needed, growth strategy for the company and market share. (78). Sharp
Corporation products uses an economy pricing strategy for their consumer electronic products
and use a premium pricing strategy for their solar energy products. Economy pricing is where the
costs of marketing and promoting a product are kept to a minimum or a no frills low price (73).
In economy pricing the margins are wafer thin and the company targets the mass market and a
high market share. Economy pricing usually represents the lowest price a company can charge
for good or services. The economy pricing strategy can help undercut current price levels of

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current competitors by offering a similar product with no frills or fancy features. Companies do
not usually spend a lot of money on administrative features, such as marketing or branding
strategies, when using economy pricing (77). One of the best examples of economy pricing is the
airline business. Airlines are always trying to keep their overheads as low as possible and in
return the company gives the consumer a relatively lower price to fill the company’s aircraft. At
first the seats are sold at a very cheap price (almost at a promotional price) and the middle
majority are economy seats, the highest price being paid for the last few seats available on that
flight (which would be a premium pricing strategy) (73). In a time of recession, economy pricing
sees more sales due the lack of consumers’ disposable income.
On the other hand Sharp’s solar energy products are sold at premium pricing strategy,
which is using a high price where there is a unique brand. This approach is used where a
substantial competitive advantage exists and the marketer is safe in the knowledge that they can
charge a relatively higher price (73). Using premium pricing strategy involves setting the price
of a product higher than similar products being sold by rivals. Premium pricing strategy is to
maximize profits where there are no substitutes for the product, where there are barriers to
entering the market or when the seller cannot save on costs by producing at a volume (78). By
using premium pricing Sharp can also improve its identity in the market or better known as
price-quality signaling. Price- quality signaling is called this because the high price signals to the
consumers that the product is high in quality. This signaling can also be used to give the
company an aspirational image (78). Although premium pricing is not usually used if there is
direct competition for the product: competition tends to undercut prices and lead to poor sales.
Because premium pricing can cause these effects it would be wise to only use this strategy for a
short-term amount of time. But the longer the company can keep its competitive advantage over

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rivals by using this strategy, the longer it can charge a premium price (78). Since solar energy
products are considered unique products, Sharps has the ability to charge a premium price for
these products. Sharp also has some of the most experience in solar energy being one of the first
companies first companies in the industry more than 50 years ago. Since the market for more
environmental friendly solutions is growing globally and the demand for this kind of energy
solution continues to develop, Sharp is planning to take full advantage of this market with their
already obtained knowledge and experience and begin to develop it further more into more
advanced energy efficient technology.
Place
Sharp products are available through an extensive nationwide network of authorized
retailers and dealers (74). Sharp products can be found in 164 countries around the world. There
many benefits that come from purchasing Sharp products from a Sharp authorized dealer. The
first reason being is the knowledgeable sales personnel, trained directly by the manufacturer and
these trained personnel have a direct relationship with the Sharp customer service staff (74). The
second reason being products purchased by authorized retailers are covered under the
manufacturer’s limited warranty retailers have an up-to-date inventory of proper Sharp
accessories and will have continuous access to these updates (74). The final reason being
Product registration and support via Sharp's AQUOS® Advantage Live which, upon registration,
includes an additional 3 months on the one year manufacturer's limited warranty (74). There are
also a few risks to not buying Sharp products from a Sharp authorized retailer. The first risk
being that the product will not contain the most up-to-date product information or the product
may even be counterfeit. Another risk of not purchasing from a Sharp authorized retailer would
be the risk of purchasing products that have already been opened or tampered with prior to the

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purchase. The final risk is no seller accountability for products that may be damaged during
shipping and also the exorbitant restocking fees (74). In the United States the authorized retailers
of Sharp products are the following: Best Buy, HH Gregg Appliances and electronics, Sears,
Target, Amazon, Costco, Sam’s Club, BJ’s, ABC Warehouse, Abt, Adorama, B&H, BrandsMart
U.S.A., Conn’s HomePlus, Cowboy Maloney’s Electric City, Crutchfield, Curaco, Dell,
Electronic Express, Frys.com, Modia, Howard’s Apppliance ans Bigscreen Superstore,
Magnolia, Nebraska Furniture Mart, Huppin’s, Paul’s TV, P.C. Richard, RCWilley, SuperCo,
US Appliance, Video & Audio Center, and Walts (76). At all 32 retailers across the United
States a consumer can find a variety of Sharp products available.
In 2013 Sharp partnered with QNET to market two of their Plasmacluster Ion Air
Purifiers models on QNET’s redemption e-store (75). QNET is one of Asia’s leading Direct
Selling companies comprising around five million customers and distributors around the world.
The company offers a varied portfolio of lifestyle products and services through its proprietary e-
commerce platform, along with a dynamic network marketing business opportunity (75). QNET
is directly selling these Plasmacluster Ion Air Purifiers, but rather using them as redemption
products through their reward program. Through QNET customers can accumulate points
through their reward program from where customers can claim gifts in exchange for the points
they have earned; the Sharp air purifiers being two of these that can be redeemed in exchange for
points (75). Sharp air purifiers are available in the QNET redemption e-Store and other regional
retails in Delhi, Mumbai, Kolkata and Bangalore.
The Association of Southeast Asian Nations (ASEAN) region is becoming the most
important market for Sharp Corporation due the soon coming increase in demand consumer
electronic products. The ASEAN region consists ten members: Brunei, Cambodia, Indonesia,

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Laos, Malaysia, Myanmar, the Philippines, Singapore, Thailand, and Vietnam (79). In this
alliance the ten countries are promoting economic and political cooperation by fostering dialogue
between those ten members of ASEAN (79). To prepare for this boom in consumer electronics
Sharp has already begun plans to build a manufacturing company in Indonesia, which will be the
countries largest manufacturing plant, as said in the promotional section. To compensate until the
demand boom, the company has service buses running around selling products and have
numerous retail stores located throughout the region.
C. Management Analysis
Sharp Corporation operates in two business segments: The Electronics Equipment
segment and The Electronic Component segment (65). The Electronics Equipment segment is all
about audio, video and communication products, which include televisions, projectors,
refrigerators, microwaves, air conditioners, copy machines etc. (65). The second segment is the
Electronic Component segment which provides liquid related product such as liquid crystal
display modules, solar cells, also electronic devices, such as parts of satellite broadcasting,
regulators and optical sensors (65).
Sharp’s business philosophy contains a statement of “Our future prosperity is directly
linked to the prosperity of our customers, dealers and shareholders...indeed, the entire Sharp
family” (72). Under this philosophy their basic concept concerning corporate governance is to
maximize corporate value through swift and accurate management that preserves transparency,
objectivity and soundness (72).
Sharp’s corporate governance system involves the Board of Directors, which supervises
directors’ execution of duties. They also have the Audit & Supervisory Board, which audits the
business executions of directors, and the Executive Officer System, which divides the

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supervisory and decision-making functions from the business execution functions (72). With
their audit & supervisory board members and the Audit & Supervisory Board, Sharp appoints
outside independent corporate auditors in order to reinforce the monitoring and checking
functions on the management and strengthen the corporate governance system (72). By
appointing outside directors and setting up various committees to enhance the supervisory
functions of the Board of Directors, Sharp believes that its corporate governance system is
adequate in terms of their philosophy mentioned before.
Sharp selects outside directors who have international, multi-faceted and compliance
perspectives on wide-ranging issues, such as the social and economic environment, and the
future direction of Sharp (72). They attempt to strengthen the decision-making functions within
the Board of Directors and the functions for supervising directors’ execution of duties. They also
have the Executive Officer System, which divides the supervisory and decision-making functions
from the business execution functions, and creating a structure that steadily facilitates nimble,
efficient business execution (72). In addition, they introduced the Business Group system, which
corresponds to the specific characteristics of their businesses (8). Under the system, they are
making reforms aimed at creating a one-stop management structure that handles development,
production and sales (72).
Kozo Takahashi is the Executive President since June 2013 (66). He joined the company
in 1980. He used to be the Chief Director of Overseas Business, Managing Executive Officer and
Chief Director of America in the company (66). He previously headed the health and
environmental products division as well as the company’s U.S. operations (68). Shigeaki
Mizushima is one of the Representative Directors, Executive Vice Presidents, and Chief
Technology Officer since May 2013 (66). He started in the company since April 1980 (66).

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Tetsuo Onishi is one of the Representative Directors, Executive Vice Presidents, and Group
General Manager (67). Onishi started in the company in 1979, he used to be the Director of
Accounting in Main Accounting Unit (66). Norikazu Hoshi has been serving as the Senior
Managing Executive Officer and Representative Director since June 2013 (66). He joined the
company in 1978; he used to serve the company as the Chief Director of 1st display Device
production and Chief of Director of Display Device Business (66). Fujikazu Nakayama is one of
the Representative Directors and Senior Managing Executive Officer (66). He joined the
company in 1978, he used to serve the company as the Director of Document System Business
(66). Yoshihiro Hashimoto is one of the Directors, Managing Executive Officer and Deputy
Chief Senior Director of Corporate since June 2013 (66). Before joining the company he used to
work for The Sanwa Bank, The Bank of Tokyo-Mitsubishi, and Mitsubishi Capital Corporation
(66). Yumiko Ito is one of the Directors and Executive Officer since June 2013 (66). She used to

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work for GE Healthcare Japan Corporation, IBM Japan, Ltd. and Microsoft Japan Corporation
(66).
Mako
to
Kato
has
been
servin
g as a
Direct
or in
the
company since June 2011 (66). He used to be a Senior Managing Director, Vice President and
Vice Chairman of the Board in ITOCHU Corporation (66). Mikinao Kitada serves as another
Director at Sharp Corporation. Akihiro Hashimoto and Shigeo Ohyagi are Directors in the Board
(67).
In 2013 they had many changes in the human resource part. They promoted Executive
Vice President Kozo Takashi to President replacing Takashi Okuda who became President in
2012. Okuda sold company assets and mortgaged its headquarters to raise funds after losses on
TVs and liquid-crystal displays drove Sharp to a record $3.7 billion net loss in the year ended
March 2012 (68). Takahashi is currently in charge of the company’s products business group,
which includes TV sets and mobile phones (68). Sharp introduced a new staff evaluation system
that is based on the performance of individual managers (70). Each employee sets their own a

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goal in consultation with their boss twice a year. Takahashi considers it crucial for all employees
to challenge themselves without fear of failure (70). Sharp forecasted net income of 5 billion yen
for the year to March 2014, its first annual profit in three years, after job cuts (69). The company
sold a stake in its largest LCD plant to Taiwanese billionaire Terry Gou to boost sales through
his Foxconn Technology Group, which is the world’s biggest contract manufacturer of
electronics (69).
In 2013 they implemented a Medium-term Management Plan valid until the end of fiscal
2015 (PDF2). Under the “Medium-term Management Plan,” they defined fiscal 2013, the first
year, as a “Restructuring Stage” and fiscal 2014 and 2015 as a “Re-Growth Stage,” where they
will step up effort to full-scale growth, therefore realizing “recovery and growth” (PDF2). In
order for them to accomplish their target they have come up with three basic strategies; shift to
advantageous markets and fields, exit closed innovation and aggressively use alliances, enforce
executions by innovating governance system (PDF2). Being more specific they will use many
strategic measures including: restructuring business portfolio, improving profitability of LCD
business, expanding overseas businesses focusing on the ASEAN (Association of Southeast Asia
Nations) Market, reducing fixed costs by introducing all-company cost restructuring innovation,
and improving financial position (PDF2). As they explain in their new plan that it “serves to
protect and enhance corporate value and common interests of shareholders and provides rules
to enable the shareholders to adequately judge the situation by requiring Large-Scale
Purchasers of Sharp’s shares to provide sufficient information including, but not limited to, the
purposes and methods of the purchase, the amount and type of consideration, basis for
determination of the purchase price, and by giving the Board of Directors of Sharp an adequate
Assessment Period” (PDF2).

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Subsection #2 – Industry Profile
1. Identification and Discussion of Relevant Competitors
A. Relevant Information Regarding the Financial Position of Key Competitors
In order to properly analyze an industry, a financial analysis among key competitors
should be performed to see where each company stands in regards to one another. By performing
a financial analysis, you will be able to see what companies are performing the strongest and
have an advantage, as well as which companies seem to be struggling and do not have an
advantage in the industry. Companies often look at their competitors and compare themselves
from a financial standpoint to see where they stand. This can give management insight as to what
they are performing well in and also what they are performing poorly in on an industry basis.
Management can utilize the financials of competitors to better position themselves in an industry
by working off of what other companies seem to be succeeding in and implementing that into
their business.
No matter what industry you are in or are looking at, every industry has competitors. This
stands true in the consumer electronics industry, which has become increasingly competitive
throughout the past couple decades. Sharp Corporation’s key competitors are other consumer
electronics companies that could be considered close substitutes for Sharp as whole company or
Sharp’s product lines individually. Sharp Corporation’s relevant key competitors are LG
Electronics, Panasonic Corporation, Samsung Electronics, and Sony Corporation.
Competitor #1: LG Electronics
Disclaimer: All Information used for this section was taken from the 2012 Annual Report and
2013 Consolidated Financial Statements for LG Electronics. Please refer to those documents for
support.

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LG Electronics has become a global leader and innovator of technology in not only the
consumer electronics industry, but in the mobile communications and home appliances industries
as well. The company is comprised of five business units in total including: Home
Entertainment, Mobile Communications, Home Appliance, Air Conditioning & Energy Solution,
and Vehicle Components. Since they implement a global business policy and play an active role
in world markets, LG Electronics has a global presence controlling 114 local subsidiaries
throughout the world while employing approximately 87,000 executives and employees. As a
company, LG Electronics strives to deliver digital products and services that make their
customers’ lives better, easier, and happier with functionality and fun.
LG Electronics balance sheet for Fiscal Year 2013 is seemingly impressive in regards to
their assets given their actual financial position in the marketplace. The company has a total
current assets number of 16.3 trillion won for fiscal year 2013. The current assets cover the
company’s current liabilities for fiscal year 2013 which are equal to 15.01 trillion won. This
means that if necessary, LG could use their most liquid assets, or assets that are easily converted
to cash, to cover their short term debt obligations to creditors. This is a positive sign for the
company. The company’s current assets would not be able to pay off the company’s total debt
for fiscal 2013 which is equal to 22.8 trillion won. The current assets would only be able to cover
approximately 71.5% of the total liabilities that the company has taken on for the year. This is
not a terrible sign for the company, but it does not show that the company can cover all of their
liabilities if something were to happen where they would need to pay debts off starting
immediately.

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LG Electronics’ largest asset on their balance sheet for fiscal year 2013 is the property,
plant, and equipment account. This account has a total value of 10.3 trillion won for the year.
Similar to Sharp Corporation, this account has been the largest asset account for LG for the past
three fiscal years. This is a result of the fact that the company is an international company with
multiple locations. Within the multiple locations, there are buildings and equipment in order to
manufacture and produce all of the products that they make. This asset account would be one of
the larger accounts on the balance sheet for a consumer electronics company because of the
business they are in. One thing to note about LG’s balance sheet is that their cash and cash
equivalent’s account is equal to 2.6 trillion won. Although significant, when compared to
different liabilities that the company has, this cash amount would not cover any of the larger
liabilities such as trade payables, borrowings, or other payables if it was necessary. All of these
liability amounts alone are greater than the cash amount. This could become a problem if the
company found that they had to pay off some of their liabilities.
LG Electronics net sales have increased steadily over the past couple years. The
company’s net sales for fiscal year 2013 are equal to 58.1 trillion won. Something to note about
the income statement is that their cost of sales is relatively high when compared to their net sales.
This means that the gross profit is low. The cost of sales for consumer electronics companies is
generally high due to the amount of money that needs to be invested in producing their goods
and manufacturing them. However, when the gross profit is low, that does not leave much room
for a company to pay expenses and other fees. LG Electronics largest expense for fiscal year
2013 is its selling and administrative expense account which is 7.04 trillion won. This account
has consistently been one of the company’s largest expense accounts.

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Stock Discussion
Unlike Sharp Corporation, LG Electronics is traded on the Korean Stock Exchange and
has declared a dividend. The closing price for LG Electronics stock on December 1, 2014 was
63,800 won (81). The company had a 52 week high of 79,600 won and a 52 week low of 58,800
won. Unlike Sharp Corporation, LG’s stock price did not remain steady between the high and
low prices (82). There was a significant amount of increase and decrease in the stock price over
the course of 52 weeks. The price steadily climbed from its low price and then steadily declined
from its high price (82). The current stock price over the past 2 months for LG Electronics has
remained relatively steady around similar values. There have not been any significant increases
or decreases to the stock price.
Competitor #2: Panasonic Corporation
Disclaimer: All Information used for this section was taken from the 2013 Annual Report for
Panasonic Corporation. Please refer to this document for support.
Panasonic Corporation is a consumer electronics company that manufactures and sells
various electronic and electric products under the Panasonic name worldwide (83). Panasonic is
comprised of over 634 companies that manufacture and market a wide range of products under
the specific Panasonic brand to enhance and enrich lifestyles all over the world (84). Products
produced by Panasonic include digital AV products such as flat screen televisions and projectors,
Blu-ray disc players, recorders, and theaters, DVD players, recorders, and theaters, digital
cameras, mobile phones, home communication products, and car AV and navigation systems
(83). Aside from those products, the company also offers a variety of other products including air
conditioners, refrigerators, washing machines, microwaves, vacuum cleaners, various kitchen
appliances, air purifiers, dehumidifiers, electric and ceiling fans, and power supply products (83).

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Panasonic Corporation’s balance sheet has some interesting numbers that help to support
why the company is currently standing where it is in the marketplace. For fiscal year 2013, the
company had a total current asset value of 2.494 trillion yen. The current assets of the company
for fiscal 2013 cannot safely cover the current liabilities of the company which were
approximately 2.599 trillion yen. With that being said, Panasonic in fiscal 2013 would not have
been in a financially sound position if they had to convert their current assets to cash and pay off
their short term liabilities. This would have left them in a vulnerable position because there
would be no cash left after paying those off. With this being said, there is no safe way to say that
company could pay off the total liability amount of 4.093 trillion yen with their current asset
amount of 2.494 trillion yen. The current assets would only be able to cover about 61.0% of the
total liabilities that were taken on by the company in fiscal 2013. Similar to LG Electronics, this
shows that the company would not be able to pay off all of their liabilities if something were to
happen.
Panasonic Corporation’s largest asset account on their balance sheet for fiscal year 2013
is their machinery and equipment account. This account had a total value of 2.723 trillion yen for
the fiscal year. Similar to Sharp Corporation and LG Electronics, this account has been the
largest asset account for the company for the past couple of years. Panasonic is an international
company like its competitors, so similar to the reasons given before, the company has invested in
a significant amount of equipment and machinery for production and manufacturing of their
products. This would be a contributor to why the amount for this account is so large. Panasonic’s
cash and cash equivalents account has significantly decreased over the course of the past three
fiscal years. For fiscal year 2011, the company’s cash account was 974 billion yen. For the most

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recent fiscal year, 2013, the company’s cash account was only 496 billion yen. This is not a
positive thing for Panasonic by looking at the other values on their balance sheet. The cash
account that they are maintaining would not be able to pay off debts in certain situations if
necessary.
Panasonic Corporation’s net sales have decreased over the course of the past three fiscal
years. The company’s net sales in fiscal year 2011 were approximately 8.692 trillion yen. For
fiscal year 2013, the company’s net sales have fallen to 7.303 trillion yen. This is not a positive
sign for the company because it does not show that they are doing well with their overall sales
amount. Similar to LG Electronics, Panasonic’s cost of sales is high compared to their net sales
amount each year. The gross profit each year has turned out to be low, leaving minimal room to
pay off expenses and fees before reaching a negative balance or amount. Panasonic’s has not
retained a net income since fiscal year 2011, when they had an income of 74 billion yen. The
company sustained net losses in both fiscal years 2012 and 2013. The net loss in fiscal 2013
amounted to negative 754 billion yen. By having significant net losses two years in a row,
Panasonic is not sitting in good financial positon compared to other companies in the industry.
Stock Discussion
Panasonic Corporation stock is traded on the Tokyo Stock Exchange and Nagoya
Securities Exchange (85). The company’s stock was listed on the Tokyo Stock Exchange
beginning in 1949, and then on the Nagoya Securities Exchange beginning in 1951 (85). The
closing price for Panasonic Corporation stock on December 1, 2014 was 1,550.0 yen. The 52
week high and low values show that the company has a stock price that has been increasing
steadily over the past few months, climbing to its high (85). Toward the beginning of the 52

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week period, the company’s stock was similar to Sharp’s stock price staying relatively around
the same price (85).
Competitor #3: Samsung Electronics
Samsung Electronics. Please refer to this document for support.
Samsung Electronics engages in consumer electronics, information technology, mobile
communications, and device solutions businesses all over the world (86). The company offers a
variety of different consumer products including: mobile phones, tablets, televisions, Blu-rays,
DVD players, home theaters, Bluetooth speakers, cameras, camcorders, refrigerators, air
conditioners, washing machines, microwave ovens, ovens, dishwashers, tablet PCs, notebooks,
chrome devices, monitors, optical disc drives, and laser printers (86). The company also provides
different healthcare products (86). Through their different innovative and reliable products, along
with talented people, and a responsible approach to business and global citizenship, Samsung is
taking the world and consumer electronics industry in imaginative new directions (87).
Samsung Electronics is one of the leading companies in the consumer electronics
industry. Their balance sheet helps to prove their position in the market. The company’s current
assets for fiscal year 2013 are equal to 110 trillion won. This amount of current assets easily
covers the company’s amount of current liabilities for fiscal year 2013 which amounted to 51
trillion won. This simply means that if something drastic were to happen, Samsung would be
able to quickly and easily convert their current assets into cash in order to cover their short-term
obligations and debts. The company’s current assets for 2013 are also able to cover the total
liabilities amount of 64 trillion won if necessary. This is great for Samsung because that means

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that they could essentially pay off their debts and obligations, both short term and long term, if
need be with just their current assets. This is what companies strive to do, because it means that
they are in a strong financial position.
Samsung’s largest asset account is its property, plant, and equipment account. For fiscal
year 2013, this account amounted to approximately 75 trillion won. Similar to Sharp
Corporation, LG Electronics, and Panasonic Corporation, this account has been Samsung’s
largest asset account for the past three fiscal years. Like explained before, being a global
company, there is a lot of investment in property and equipment to keep operations going.
Therefore it makes sense for this account to be the largest asset account on their balance sheet
from year to year.
Samsung Corporation’s statement of operations, or income statement, shows that the
company has been doing increasingly well over the past couple of fiscal years. Samsung’s
revenues have increased over the past three fiscal years. Fiscal year 2011 brought in revenues of
165 trillion won, while fiscal year 2013 brought in a revenue of 228 trillion won. This is positive
for Samsung because it means that the company is doing well and is making sales. Samsung’s
cost of sales is not as high when compared directly to the revenue. When looking at competitors,
the cost of sales typically brought the gross profit down to a minimal amount. In Samsung’s case,
the gross profit is relatively high which leaves room for expenses and allows for the possibility
of a net income to be made from year to year. In fact, Samsung has maintained a net income over
the past three fiscal years. Their net income has increased substantially since 2011. In fiscal year
2011, the net income for the year was 13 trillion won, where as in fiscal 2013, the net income

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amounted to 30 trillion won. This shows positive earnings for the company and also shows that
Samsung is in a strong financial position.
Stock Discussion
Samsung Corporation stock is traded on the Korean Stock Exchange, similar to LG
Electronics. The closing price for Samsung Corporation stock was 1,295,000.00 won on
December 1, 2014 (88). Samsung stock had a 52 week high of 1,495,000.00 and 52 week low of
1,078,000.00. The 52 week graph and chart of Samsung Corporation stock shows that the stock
price stayed around the same price for the first couple months (89). However, over the last 6
months of the 52 week period there has been a steady decrease in the stock price (89). Only
recently has the stock price for Samsung Corporation started to climb back up (89).
Competitor #4: Sony Corporation
Sony Corporation. Please refer to this document for support.
Sony Corporation is a consumer electronics company that is divided into seven segments
including: electronics, mobile, games, movie, music, network services, and financial services
(90). As a company, they have a mission to be a company that inspires and fulfills customer’s
curiosity (90). Sony is an international company that is a diversified global company at the
forefront of innovation and entertainment (91). The company has expanded into many regions
over since its start and is looking to continue that venture with everything that it has planned for
the future.
In terms of a balance sheet analysis, Sony Corporation is in a similar situation to
Panasonic Corporation. For fiscal year 2013, Sony had a total current asset value of 3.646 trillion

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yen. The current assets of the company for fiscal 2013 cannot safely cover the current liabilities
of the company, which came out to be about 4.315 trillion yen. With that being said, Sony
Corporation in fiscal 2013 would not have been in a financially sound position if they had to
convert their current assets to cash and pay off their short term liabilities. This would have left
them in a vulnerable position. Further, the company could not pay off the total liability amount
of 11.522 trillion yen with their current asset amount. The current assets would only be able to
cover about 31.6% of the total liabilities that were taken on by the company in fiscal 2013.
Similar to LG Electronics and Panasonic Corporation, this shows that Sony would not be able to
pay off all of their liabilities if something drastic were to happen.
Unlike all of its competitors up to this point, Sony Corporation’s largest asset account is
its securities investments and others account. This account for fiscal year 2013 has a total of
7.118 trillion yen. This has been the company’s largest asset account for the past three fiscal
years. The company has investments in a significant amount of securities and other investments
that are substantial to the company, as shown by the amount on the balance sheet compared to
other asset accounts. For fiscal year 2011, the company’s cash account was 1.014 trillion yen.
For the most recent fiscal year, 2013, the company’s cash account dropped to 826 billion yen.
This is not a positive thing for Sony Corporation by looking at the other values on their balance
sheet. The cash account that they are maintaining would not be able to pay off debts in certain
situations if necessary, which is similar to Panasonic.
Sony Corporation’s net sales have jumped around over the past three fiscal years. Fiscal
year 2011 had a net sales amount of 6.304 trillion yen. The net sales dropped to 5.526 trillion yen
in fiscal year 2012, but increased slightly to 5.691 trillion yen in fiscal year 2013. This shows

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that the net sales of Sony are inconsistent and have no real pattern that they have been following.
However, the net sales amounts are significant enough that they offset the high cost of sales that
the company maintains from year to year. Fiscal year 2013 was the first year for the past couple
of years that Sony was able to sustain a net income after expenses were subtracted from the
revenues. Fiscal year 2011 and fiscal year 2012 both brought about significant net losses. Fiscal
year 2011 had a net loss of 220 billion yen, fiscal year 2012 had a net loss of 398 billion yen.
Sony Corporation was able to sustain a net income for fiscal year 2013 that amounted to
approximately 104 billion yen. By sustaining significant net losses two years in a row, Sony
Corporation could be in financial trouble. However, by achieving a net income in fiscal 2013, the
company has something to work off of.
Stock Discussion
Sony Corporation stock is traded on the Tokyo Stock Exchange, similar to Panasonic
Corporation and Sharp Corporation. The closing price on December 1, 2014 for Sony
Corporation stock was 2,640.00 yen (92). The stock had a 52 week low price of 1,514.00 and a
52 week high of 2,683.00. The 52 week graph and chart of Sony Corporation stock shows that
the price of stock had no drastic changes in price over the past year. In fact, the price only began
rising to its 52 week high within the last month or two. Before that, the price moved at a steady
pace and stayed around the same price never changing too much.
Financial Position Comparison of Competitors Using Ratio Analysis
Disclaimer: All Information used for this section was taken from the 2013 Annual Reports for
Sharp Corporation, Sony Corporation, Samsung Electronics, and Panasonic Corporation.
Information was also taken from LG Electronics 2012 Annual Report and 2013 Consolidated
Financial Statements. Please refer to these documents for support.

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A comparison of Sharp Corporation and its key competitors can be done using different
financial ratios. These different financial ratios can be used to see where each company stands in
regards to one another and how each one then stands overall in the industry. Financial ratios can
help companies understand not only where they stand next to their competitors, but what they
should improve on in order to be successful in an industry. To compare Sharp Corporation and
its four key competitors, six financial ratios can be used. These six ratios include the current
ratio, the acid-test ratio, the debt to equity ratio, the debt to assets ratio, the asset turnover ratio,
and the profit margin ratio.
Current Ratio Comparison
As discussed in Sharp Corporation’s financial discussion, the current ratio of a company
measures a company’s ability to pay its short term obligations and debts. The equation used is,
current assets / current liabilities.
Sharp
Corporation
LG
Electronics
Panasonic
Corporation
Samsung
Electronics
Sony
Corporation
Current Ratio –
Fiscal Year 2013
0.89 1.16 0.96 2.25 0.85
Samsung Electronics has the strongest current ratio and is in the best position to pay off their
short term obligations with their present current assets. LG Electronics is in a good position
because they are sitting at a ratio above one. Sharp Corporation, Panasonic Corporation, and
Sony Corporation all have current ratios under one which is unhealthy because that means that
none of them would be able to pay off their obligations with their current assets. Sony
Corporation is in the worst position with an 0.85 current ratio, which means that they would only
be able to pay 0.85 of their current liabilities with their current assets if it came down to it.
Acid-Test Ratio

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The acid-test ratio is similar to the current ratio, but it only accounts for specific current
assets as discussed in Sharp’s previous financial discussion. The equation for the acid-test ratio is
as follows: (Cash + Accounts Receivable + Short Term Investments) / Current Liabilities.
Essentially, the acid-test ratio will tell a company whether it has enough short term assets to
cover its immediate liabilities without selling off inventory.
Sharp
Corporation
LG
Electronics
Panasonic
Corporation
Samsung
Electronics
Sony
Corporation
Acid-Test Ratio –
Fiscal Year 2013
0.61 0.69 0.55 1.58 0.57
The only company that is in a good position from looking at this ratio is Samsung Electronics.
Ideally, companies want to have an acid-ratio that is greater than one because that means that
they are in a place to pay their current liabilities with specific current assets. Sharp, LG,
Panasonic, and Sony are all significantly under one, so they will be looked at with caution when
it comes to this ratio. However, they are all close to one another so they are in similar situations
when it comes to this ratio and paying off current liabilities when inventories are not included.
This ratio compares a company’s total liabilities to its total shareholders’ equity. The
equation used for this ratio is total liabilities / net assets. The result is a ratio that measures how
much suppliers, lenders, and creditors have committed to the company versus what the
shareholders have committed to the company.
Sharp
Corporation
LG
Electronics
Panasonic
Corporation
Samsung
Electronics
Sony
Corporation
– Fiscal Year 2013
953% 72.59% 87.67% 4.95% 44.1%

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Companies want this percentage to be lower because that means that their company would be
using less leverage and would therefore have a stronger equity position. With that being said,
Samsung Electronics is in the best position according to this ratio because they are at 4.95%.
Sony Corporation is not doing too poorly as compared to the others. Panasonic and LG are close
to each other. Sharp Corporation has a high debt to equity ratio for reason discussed in their
financial analysis. They are not doing well when compared to the rest of the industry and to their
key competitors.
The debt to assets ratio is another leverage ratio but this one measures how much of a
company’s assets are being financed with debt. Similar to the debt to equity ratio, companies
want this ratio to be lower because then they have a better chance at paying back their debts. The
equation used to find this ratio is simply total liabilities / total assets.
Sharp
Corporation
LG
Electronics
Panasonic
Corporation
Samsung
Electronics
Sony
Corporation
90.50% 25.93% 21.18% 3.47% 8.30%
Similar to the debt to equity ratio, Samsung has the lowest debt to assets ratio which means that
they are in the best position. Sony follows behind them, with LG and Panasonic in a similar
situation. Sharp Corporation has the highest and worst debt to assets ratio because they have
taken on such a large amount of short term and long term debt that they cannot balance it out
with the assets they maintain.

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The asset turnover ratio shows the amount of sales or revenues a company generates per
dollar of assets. The equation to get this ratio is sales / total assets. A higher value for this ratio is
what companies strive for because that means that the company is generating more revenues per
dollar of assets – which is what management and companies want.
Sharp
Corporation
LG
Electronics
Panasonic
Corporation
Samsung
Electronics
Sony
Corporation
1.16 1.65 1.22 1.16 0.50
LG Electronics has the advantage when it comes to this ratio in the industry. Panasonic,
Samsung, and Sharp are all in the middle with similar ratios which indicates that they are all
pulling out similar results in regards to this ratio. Sony is struggling according to this ratio. They
are significantly lower than the rest of their key competitors which indicates that their sales are
not high when compared to their total assets.
Profit Margin Ratio
Calculated as net income / sales, the profit margin is a profitability ratio that measures
how much of every dollar of sales that a company is actually keeping in earnings. A higher profit
margin is typically favored because it indicates a more profitable company that has better control
over its costs. This ratio is a key financial ratio when comparing companies across an industry,
such as the consumer electronics industry.
Sharp
Corporation
LG
Electronics
Panasonic
Corporation
Samsung
Electronics
Sony
Corporation
Profit Margin Ratio –
Fiscal Year 2013
0.39% 0.91% -10.33% 11.76% 0.63%
Samsung Corporation is in the best financial position when comparing profit margin because
they have the highest one. LG, Sony, and Sharp Corporation are all between 0.00% and 1.00%,

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which indicates that they are performing similar in regards to this ratio. Panasonic is the only
company that ended up with a negative profit margin. This is because they sustained a net loss in
fiscal year 2013, so they are going to have a negative profit margin.
Conclusion
Samsung Electronics has the strongest ratios in every category with the exception of one,
which was the asset turnover ratio. Therefore out of Sharp Corporation’s key competitors,
Samsung is leading in the industry in terms of their financials and what they are doing. Both
Sharp Corporation and Sony Corporation did not fare well in multiple ratio analysis. This
indicates that the companies are having trouble with their financials and sustaining positive
outcomes. They are on the lower end of the industry and not leading it by any means. LG
Electronics and Panasonic Corporation averaged middle of the pack ratios. Neither company was
a standout like Samsung, but neither remained consistently at the bottom either. This indicates
that these two companies are doing fairly well with their performances but some of their
individual ratios indicate that there are areas for improvement. The consumer electronics
industry is a competitive industry and Samsung Electronics has done what has needed to in order
to gain the advantage in the industry above its key competitors including: Sharp Corporation, LG
Electronics, Panasonic Corporation, and Sony Corporation.
B. Relevant Information Regarding Current Marketing Strategy of Key Competitors
When discussing Samsung Electronics, LG Electronics, Sony Corporation and Panasonic
Corporation as competitors to Sharp Corporation, it is important to dissect the competition’s
marketing mix. The marketing mix consists of four main components – product, price, place, and
promotion. In looking at these factors, a company can stay competitive within the industry and
keep an eye on what other players are doing within the industries it does business in. Thus, in

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this section we will be discussing the marketing mix of Sharp’s key competitors: Samsung
Electronics, LG Electronics, Sony Corporation, and Panasonic Corporation.
Competitor #1 - LG Electronics
LG Electronics, as a competitor to Sharp Corporation, should be analyzed according to its
marketing mix. The marketing mix consists of four main components – product, price, place, and
promotion. In looking at these factors a company can stay competitive within the industry and
keep an eye on what other players are doing within the industries it does business in. Thus, in
this section we will be discussing the marketing mix of LG Electronics.
Products:
LG Corporation as a whole is made up of three main areas – Chemicals, Telecom &
Services, and Electronics (PDF4). The Chemicals field consists of LG Chem and LG Household
& Health Care, the Telecom & Services division is comprised of LG U+ and LG CNS, and the
Electronics unit consists of LG Electronics and LG Display (PDF4). The most important
business unit to focus on is the LG Electronics segment, which is comprised of five main
business units. These business units consist of Home Entertainment, Mobile Communications,
Home Appliance, Air Conditioning and Energy Solutions, and Vehicle components (93). All of
these are consumer electronic products and have main products within each business division
that serve different consumer needs. As for the Home Entertainment unit, some of the main
products that are offered include televisions, audio and video, monitors, PCs and accessories, and
commercial products (93). Within the Mobile Communications segment, the company has its G
series, Vu: Series, F Series, and L Series II (93). LG’s home appliances have product offers such
as refrigerators, washing machines, stylers, cooking and cleaning devices, and built-in appliances
for consumers’ homes (93). As for the Air Conditioning and Energy Solutions business segment,

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the main products are residential air conditioners, system air conditioners, lighting, and building
management systems (93). Lastly, the Vehicle Components unit consists of in-vehicle
infotainment, HVAC and motor, and vehicle engineering (93). This is just a broad sense of the
product in which LG Electronics puts out on the market for consumers.
To get a better sense of what each electronics unit offers, more detail should be discussed
about the products that exist within them, starting with the Home Entertainment division. The
company as an array of televisions in its product line, which consists of LED, OLED, LCD,
Plasma, UHD, Smart, and 3D (95). LG’s LED TVs are the slimmest in its product line that
delivers vivid colors with a “brighter, smoother, clearer” picture for viewers (95). The
company’s OLED TVs are intended to give consumers “richer, more saturated, life-like colors”
and are energy efficient (95). The LCD TVs are described on the company’s website as
lightweight and are the perfect match for bright rooms (95). LG’s plasma TVs compliment high-
motion pictures, which makes the TV model good for watching sports, actions films, and playing
video games (95). The UHD product line delivers twice the resolution of an HD TV and
produces a crisp and vivid picture that consumers will feel as if they are right in the middle of the
movie, so LG says (95). The company’s smart TVs provide consumers with limitless options for
entertainment from movies to TV shows to games to videos and also TV applications (95). In
regards to LG’s 3D TVs, this television product line gives consumers an immersive 3D
experience whether they are watching an action flick, a major playoff game, or even a comedy
on TV (95). Within the Home Entertainment section there is also audio and video technologies
offered that consist of home theater systems, sounds bars, and SoundPlates™ (96). LG’s home
theater systems have a range of features that consumers can take advantage of, such as Blu-ray,
IPod and IPhone compatibility, AM/FM tuner, Upscale Standard DVDs (which allows

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consumers to watch standard DVDs with high picture quality), and Silk Dome Speaker
Technology (96). The company’s sound bar and SoundPlates™ also contain many features like
wireless technology that allows consumers to choose where they want to place their speakers in a
certain space, Bluetooth streaming that allows consumers to hook up a variety of portable
devices, wireless subwoofer that gives off a deep base and can be placed in any location, LG
sound gallery that provides consumers with seven different sound genres to create the perfect
acoustic experience, a slim design that makes mounting a jiff, built-in lock feature that can easily
connect to any TV so consumers can experience surround sounds, and lastly 3D sound processor
that gives consumers a “full, immersive sound” when watching their favorite 3D entertainment
(97). The next category with Home Entertainment deals with monitors, PCs, and accessories.
The company’s monitors consist of 21:9 UltraWide Monitors, Gaming Monitors, IPS (In-Place
Switching) Monitors, LED Monitors, as well as 3D Monitors (98). These different models are
intended to meet the needs of various consumers. LG even pairs up with ENERGY STAR® to
offer more energy efficient products to reduce the amount of energy consumed when people use
its products day in and day out (6). Some of the accessories that the company offers for its
monitors and PCs are Blu-ray burners and drives, Blu-ray combo burner and drives, and also
DVD burners and drives (99). LG also offers a fascinating mouse that encompasses the
capabilities of a mouse and a scanner all in one (100). Lastly, within LG’s Homes Entertainment
business segment, the company offers commercial products. In being more specific these
commercial products include digital signage displays, smart hotel TVs, and security cameras &
digital video recorders that are to be purchased and used by other businesses (LPDF4).
The next division to look at is LG’s Mobile Communications. This business unit is made
up of cell phones, tablets, smart watches, as well as Bluetooth & mobile accessories. The

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company has cell phones ranging from flip phones to slider phones to touchscreen phones to
smartphone, all of which are design to fit different consumers’ lifestyles (101). There are several
different carriers that LG phones can be purchased from including AT&T, Sprint, Verizon, T-
Mobile, and others (9). There are also different series as mentioned earlier. The G Series is made
up models known as G2, G3, G3 Beat, G Flex, G Pro, G Pro 2, G2 Mini and the G Pad (PDF4).
Each of these models possesses different features that separate on device from another. For
instance, the G Flex looks as if the phone can bend and has a natural curve to the design, whereas
the G2 Pro emphasizes a bigger so that consumer can enjoy more with a compact device (PDF4).
There is also the F Series of smartphones and the L Series of smartphones (PDF4). There is also
the wearables product line that offers the company’s LifeBand Touch and LG G watch (PDF4).
Both of these technologies show how LG has jump on the bandwagon for these types of products
that other companies within the industry are delivering, such as Sony and Samsung. Furthermore,
LG’s Home Appliances unit offers products that serve home areas ranging from the kitchen, to
the laundry room, to the family room, and more.
Price
LG is debatably one of the market leaders in the consumer electronics industry meaning
the company can charge a slightly higher price than competitors, and consumers will still pay the
higher price because the consumers know they will be receiving a quality product. To price their
products, LG Electronics uses competitive pricing. When LG is setting the price of a product it
is based upon what the competitor is charging for a similar product. Also, when considering
pricing a new product LG has to take into considerations of how many substitutes are available
for that product. If the company sets the price too high consumers will choose a cheaper
substitute and maybe settle for lesser quality rather than pay more. When setting the price of a

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product, LG has three options to consider. They can set the price below competition, at the
competition price, or above the competition price (106). In order to charge a price above the
competition the company must create an environment that warrants the premium, such as
payment terms or extra features (106). Setting the price below the competitors can cause for
potential loss, but if the company believes that enough consumers will purchase the product to
still make a profit, then there may be an advantage there (106).
Place
LG Electronics has head offices located in six of the major regions around the world:
Europe, Middle East and Africa, Russia and CIS, Asia and Oceania, North America, and South
and Central America. Within these regions, the company has 114 subsidiaries worldwide (104).
When LG was first getting started, the company targeted upscale retail stores like P.C Richard to
sell their products (102). The company did this to prove to the consumers that the product they
were producing was of high quality. However, now the company has made it products available
to retailers like K-Mart, Wal-Mart, and Sam’s Club because the company has proven to the
consumer that they do in fact make a high quality product. LG has accumulated many partners
who help distribute their product around the world. Distribution partners for LG inlcude: Clear
Sight & Sound, Sears Commercial, APEX Procurement, MDM lodging, Global Motel Supplies,
Direct Hotel, Flagstaff, Hospitality LCD, IE, PTAC Direct Sales, 4A World Commercial, TR,
KniTec, Synnex Corporation, dts, Tech Data, Ingram Micro, CDW, LeaderTech, ASI, Fagan,
D&H, MA Labs, HD Distributing, International Audio Visual Inc., Private Label PC, Stirling
Communication Supply Co.,Ltd, ALMO Professional AV, TXL Distribution, Stampede, Digital
Data, Capitol Sales Service Solution, and USEI Electronic Inc. (105). These distributors are
broken down into five different kinds of distribution partners: hospitality, healthcare, channel,

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specialty (healthcare), and specialty (video wall) (105). LG does some unique things with their
distribution companies. For most of their distribution partnerships, LG Electronics is not selling
to the businesses themselves, but are selling their products through their distributors. For
example when LG is supplying a hotel with a product, LG doesn’t deal with the hotel directly,
LG deals with supplier who supplies those hotels with products.
Promotion
LG Electronics is a brilliant company when it comes to marketing their products. In som
cases, consumers may not even know they are being exposed to the company’s promotional
tactics. It all starts with company’s logo and slogan. With the company’s slogan being “Life’s
Good” and company logo being the letters “L” and “G” encompassed to resemble a “Cheery
Face”, the slogan practically draws customers in. The “LG Electronics brand slogan conveys a
message that LGE enriches customers’ lives with its products, services and technology, and
creates a unique brand identity of the company” (103). LG has gotten much recognition through
sponsorships of sports and through endorsing celebrities. LG sponsors the highly rated NCAA
college basketball tournament (102). The company teamed up with Oprah Winfrey to give away
350 “refrigerators of the future” and high definition TVs to her audience during one of her shows
(102). LG also placed its televisions in hotels, motels and airports for consumers to experience
their products without actually buying it; it’s like getting a free trial. By the consumer using the
TV, LG hopes the consumer has a good experience, and will persuade or make them want to go
and buy one upon returning from their trip.
Product:

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Panasonic Corporation is one of Sharp Corporation’s more relatable competitors, due to
the fact they both have similar product lines and are in the same financial position in the
consumer electronics industry. Both companies are not market leaders, but they are not far
behind. With that being said, neither company is at the bottom of the market either. If both
companies were to be put in a class they would be in the upper middle class. Panasonic has a
variety of products that compete with Sharp, and these products are broken into divisions. The
first division is TVs and projectors, the second is players and recorders, the third is audio, the
fourth is imaging, the fifth is household, the sixth is air conditioners, the seventh is power tools,
and the final division is solar, lighting and batteries (107). Panasonic has their TV division
separated in two categories: LED/LCD TVs and Plasma TVs. The LED/ LCD TV is available in
three different models: the 4K Ultra HD, FHD and HD (108). The 4K Ultra HD TV is
Panasonic’s newest and top-of-the-line TV. The 4K comes with features such as Studio Master
Drive, Local Dimming Ultra and 4K Fine Remaster Engine (108). With the Studio Master Drive
feature the consumer will experience more accurate color and smoother gradation. This feature
achieves highly detailed black expression even in very dark scenes (108). The 4K fine Remaster
Engine 2 feature allows the TV to be viewed in 3D, connect wirelessly to the internet, and have
twin HD tuner capabilities to name a few (108). The FHD model offers excellent picture quality,
a stylish design, and superb versatility (109). The FHD has a Life Screen feature where the
consumer can design a home screen with their favorite channels, apps, websites, etc. all located
on this screen (109). The second division, player and recorders, includes recorders, players, and
accessories for the two items just listed. The third division is audio, which includes products
such as: Hi-Fi, home theater, sound bar, headphones, clock radio, portable AM/FM radio, and
portable CD radio cassette player (109). The fourth division is imaging which consists of: lumix

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cameras, camera, accessories, lumix G cameras, lumix G lenses, camcorders, camcorder
accessories, and SD cards. The fifth division household includes items like: refrigerators,
washing machines, dryers, microwave ovens, small appliances, grooming, and cordless phones
(109). The sixth division is air conditioners, which includes: ECONAVI reverse-cycle inverter,
cooling only inverter, standard reverse-cycle inverter, inverted ducted, and inverter cassette
(109). The seventh division is power tools and includes these products: single tools (drills),
combo kits, flashlights, and accessories (109). The final division is solar, lighting, and batteries,
this division includes the following products: household batteries, LED lighting and solar panels
(109). Sharp Corporation and Panasonic Corporation are directly competing with one another
when it comes to these products: TVs, blue-ray players, household appliances, air conditioners,
and solar panels. Although, Sharp is much more advanced in the solar industry than Panasonic,
however Panasonic is still considered a rival because the company could still steal customers at
the lower residential market from Sharp.
Price
Panasonic is a company a lot like Sharp where they don’t spend very much money on
marketing, therefor making their pricing strategy economy pricing. Economy pricing is when the
costs of marketing and promoting a product are kept to a minimum (110). The company is
already trying to cut costs in other areas and not even trying to budget marketing products into
their budget, they just want keep the marketing sections as it is. The company wants to roll out
newer models, which will cut down the entry-level price of other products like home theater and
digital camera (111). "The price is also brought down by shedding unnecessary product features
which may not be required in the smaller towns. Such cost benefits are directly passed on to the
consumer," said Mr. Sharma. The company is removing unnecessary features from it products to

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cut down production costs. For example the company reduced the number of HDMI ports on its
32-inch LCD TV from four down to one (111). From this example the company is really trying
to cut costs and does not have an abundant amount of money to spend marketing new products.
Place
Panasonic uses a distributor to distribute their products around the world. The company
that distributes their products for them is called TTI Inc. (112). This company is Panasonic’ s
premier authorized distributor. TTI Inc. is responsible for distributing all Panasonic products to
all of its retailers. These retailers include companies such as Best Buy, HH Gregg, and many
other electronic stores worldwide.
Promotion
Panasonic keeps it old school when it comes to having promotions for their products; the
company primarily only offers coupons and deals online at various websites. Some of these
coupons and deals will include incentives to encourage you to buy their product such as free gift.
For example this coupon states, “Extra $24 off 4-Blade Wet/Dry Shaver + Free Case” (113). The
company also promotes deals on products like their TVs, like this one which states, “This
Panasonic 40” 120Hz Smart TV drops from $529.99 to $349.99, with free at Panasonic” (113).
In both of these promotions, the company is willing to give the consumer something free if they
are willing to help encourage others to buy their product. Panasonic biggest promotion is that
the company is the official of FCB (Football Club of Barcelona) (114). Through this promotion
Panasonic puts an emphasis on how well the picture of the game being played is portrayed on
their television screen. “Our LED TVs feature super-high-speed scanning and backlight blinking
technology to ensure liguid-smooth reproduction of fast-moving action, easily keeping pace with
the fastest and most skilled on the FC Barcelona side” (114). Panasonic uses technologies in their

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TVs to make the consumer feel like they are sitting right there in the stands watching the game.
This not only through visual but sound as well.
Competitor #3 - Samsung Electronics
Products
Samsung Electronics is the industry market leader and with being in that position, a
company must have many products to offer. The company must not only offer them, but produce
quality products that function properly, are dependable and that are durable. Samsung
Electronics competes with many of Sharp Corporation’s products, but Samsung has more to
offer. Samsung’s product line includes cell phones, TVs, tablets, wearable tech, blue-ray and
smart players, home theater and audio, digital camcorders and cameras, computing, memory and
storage, home appliances, LED lighting, security and monitoring, and accessories (115).
Samsung Electronics and Sharp Corporation compete with one another at the same level with
many of the products that they offer. Both companies offer TV, blue-ray disc players, home
theater, LED lighting, home appliances, and cell phones. The two highest competing products of
these two companies are their cellular phones and their TVs.
Samsung offers two different models of cellular mobile phones, which are the Galaxy S
and the Galaxy note (116). Samsung’s newest available phone is the Galaxy S5 series. The
Galaxy S cell phone is available in two models: the Samsung Galaxy S5 Sport and the Galaxy
S5. The Galaxy S5 is available in four different color options: blue, black white or yellow (117).
While the Galaxy S5 is only available in two color options, those being red and blue (117). Both
cell phones possess 5.1-inch full HD Super AMOLED displays, 16-megapoxel cameras, heart
rate monitor, and finger print access scanners features (117). The difference between the Galaxy
5S and the Galaxy 5S sport is that the sport model is water and dust resistant, contains work on

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your fitness goals capabilities through S Health and Activity Zone technology, immersive 5.1-
inch HD display for incredible detail and rich color, and fast action 16MP camera with Pro
Editing Tools (117). The Galaxy Note is basically the same at the Galaxy S series phones only a
bigger. The Samsung Galaxy Note comes in either black or white. The Note possesses features
such as: innovative smart edge screen, 5.6-inch Quad HD super AMOLED display, Enhanced S
Pen with more precision and functions, and 16 MP rear camera with optical image stabilization
(118). All of Samsung’s cellular phones are available through AT&T, Verizon Wireless, Sprint,
and T-Mobile service providers (115).
Samsung has a full line of TVs in which they offer that are divided into four categories;
the first TV being their top of the Line 4K UHD TV. The 4K UHD TV consists of the most up to
date technologies available for televisions. The 4K UHD is unique because the screen is not
actually flat; it is slightly bent into a “U” shape. This curved screen crates a wider field of view,
which makes the image seem bigger, the screen feels cinematic, and the experience feels larger
than life (119). The 4K offers four times the resolution of full HD, colors are pure, motion is
fluid and every image is simply stunning (119). All Samsung UHD 4K TVs are Smart TVs.
Which means you get access to streaming content, games, apps, social, multimedia, Internet and
more right from your TV. Also since TV technology is constantly evolving, the company
equipped the TV with Samsung Evolutionary TV, which allows the consumer to update the TV’s
Smart Hardware and software to keep up to date with the latest technologies (119). The second
TV Samsung offers is the OLED TV. The OLED TV screen consists of thousands of organic
LED pixels that display richer and brighter images compared to the company’s competitor’s
LED TVs (120). The OLED TV is also a curved design like the 4K, but also has another very
nice feature the 4K does not posses. This feature being that the TV has a floating canvas frame,

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as if it looks like a painting hanging on a wall (120). The OLED TV looks good when it is turned
on or even when it is turned off. The most impressive feature this TV possesses is the multi view
feature. This feature allows two people to simultaneously watch two different full-screen
program by just simply putting on special eye wear (120). The next TV model offered is
Samsung’s LED TV which includes features such as: curved panel screen, auto depth enhancer,
precision black local dimming, and ultra clear panel (121). The Last TV Samsung has available
is their plasma TV. The plasma TV has Smart TV capabilities includes features such as super
contrast panel, S-recommendation, Smart interaction, real black pro filter, smart evolution, quad
core processor, and 600Hz subfield motion (122).
Price
Samsung Electronics uses two different types of pricing strategies: skimming price and
competitive pricing (123). Each pricing strategy is used for different products offered by the
company. Samsung uses price skimming for its smart due the fact that they are the market leader
for the products (123). Price skimming is when a company charges a higher price for a product
because it has a sustainable competitive advantage over its competitors (73). A downfall to
having this high of a price for a product is that it attracts new competitors to the market and the
price of the product will eventually decrease (73). When Samsung first releases new smart pone
the company charges a high value for that product before its competitors catch and release their
own similar product (123). Once the product is out dated or a competitor has launches a similar
product, Samsung immediately drops the price of the product (123). The other pricing strategy
that Samsung uses is competitive pricing which is used for products other than smart phones.
Competitive pricing is when a company sets the price of a product based upon what their
competition is charging (124). Competitive pricing is used mostly when products on the market

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are very similar and little substitutes are offered (124). These other products include televisions,
air conditioners, refrigerators, and other competitive products offered by Samsung (123).
Samsung simply uses competitive pricing to beat the competitors.
Place
Samsung produces many different products and to distribute all these products the
company relies on several distributers to deliver its products around the globe. The company
focuses on three main segments that originate from the channel marketing concept. The three
main segments the company uses are: sales and service dealers, modern retail, and distributers
(124). The main job of the sales and service dealers segment are to handle accounts for Samsung
and are involved in corporate sales (124). The modern retail segments are responsible for the
company’s current retailers. These retailers include: Croma, Hypercity, Vijay sales, and any
other retailers who are present in the modern electronic retail chain (124). The distribution
segment of the three segments is probably the most key and vital of the segments. The
distribution segment has to deal the actual distribution of the products to the retailers. Samsung
has come up with a pretty interesting way of doing so. The company has one distributer for a
large region, but that distributor has a large amount invested in Samsung as well. Meaning that if
the distributors distribute Samsung’ s products the right retailers who will sell the most, both
companies will benefit from this happening. “For example – In Mumbai, Samsung has SSK
distributors who are distributors for all Samsung products. This distributor has a huge investment
in Samsung and both, the distributor and the company, go hand in hand for the sale of Samsung’s
products. Thus all material of Samsung will be sold to a single distributor who in turn will sell it
forward to retailers (124)”.
Promotions

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Samsung like every one of the company’s competitors uses many forms of promotions to
help convince the consumer that their product is better than their competitors and use things to
relate to the consumers to help them be persuaded to buy their product the rivals. Samsung uses
many forms of promotion to try and convince consumers to their products, this includes:
advertising, the use of marketing vehicles during certain times of the year, special offers and
discounts, and the company’s pull strategy (124). Samsung uses advertising to pull the customers
to their products but also simultaneously push the product the customers through sales and
promotions (124). Also throughout the year, Samsung will have marketing vehicles doing
promotions during festive and non-festive times of the year. Samsung will also give special
offers and discounts to its trade partners to help motivate and influence them to sell Samsung
products over the competitors (124).
Competitor #4 - Sony Corporation
Product
Sony Corporation competes for the same consumers as Sharp Corporation due to the
many products that they both produce. The company produces products that directly compete
with Sharp products. Sony produces many products, which are broken down into categories.
Products that Sony produces that directly compete with Sharp’s products are digital imaging
products, professional solutions, game, mobile products and communications, home and
entertainment sound, devices, pictures, music, and financial services (125). The digital imaging
category includes products such as: digital cameras, video cameras and interchangeable single-
lens cameras. The second category, professional solutions, includes broadcast-and professional-
use products (125). The next category, game, is responsible for producing, marketing, and
distributing of the PlayStation gaming console, PlayStation Vita, PlayStationPortable and their

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hardware and any other related packaging software to go along with them. Sony’s mobile
communications category includes personal and mobile products (125). The home entertainment
and sound category includes products such as TVs and audio and video. Audio and video being
products such as home audio, blue-ray disc players/recorders, and memory based portable audio
devices (125). In the devices category, one will find products, which include semiconductors and
components. Semiconductors include CMOS image sensors, CCDs, system LSIs, small- and
medium-sized LCD panels and other semiconductors. Components include batteries,
audio/video/data recording media, storage media, optical pick ups, chemical products, and
optical disk drivers. Chemical products include materials and components for electric devices
such as anisotropic conductive films (125). The next category pictures, has to deal with the
global operations of Sony’s motion picture productions, acquisition, and distribution. Sony
possesses four motion picture production companies including Columbia Pictures, Tristar
Pictures, Screen Gems and Sony Pictures Classics (125). This category also includes Sony
Picture Television, which develops and produces television programs to approximately 75
countries with 120 channel feeds (125). The next category is music, which includes Sony’s four
music publishing businesses. These business are primarily involved in the development,
production, and distribution of recorded music (125). The final category is financial services. In
2004 Sony established a wholly owned subsidiary. The financial subsidiary having three
departments, which are Sony Life, Sony Assurance, and Sony Bank are offering services
including insurance and savings and loans, and offering customers valued products and services
(125). Products of Sharp and Sony that would directly compete with another would be TVs,
blue-ray disc recorders/players, home theater, and mobile phones.

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Sony Corporation has two TV models available on the market right now. The first being
their 4K Ultra HD TV: XBR series. Which according to Sony is their “top-of-the-line TV for
premium quality and elegance”. The 4K Ultra HD has four times the clarity of full HD 1080p
(126). The TV also contains features such as X-tended dynamic range with up to three times
brightness range, more brilliant color the ever with TRILUMINOS display, and the latest HDMI
support for next generation 4K players and services (126). The other TV model offered is Sony’s
full HDTVs: W & R series. According to Sony their HDTVs, “full brightness and clarity for
every room in your home.” So no matter which room the customer decides to place their TV in,
the color or darkness or brightness of the room will have no effect on the image portrayed on the
screen (126). Sony’s HDTV contains features such as color clarity and detail to the best X-
Reality Pro, loud clear surround sound and dialogue with Clear Audio+, stream HD
entertainment wirelessly with built in Wi-Fi, and TRILUMINOS picture display for more
brilliant colors available (126).
Sony Corporation also produces mobile devices that compete for the same market as
Sharp. Sony currently offers one smart phone line, which is the Xperia, but the Xperia is
available in a variety of different models. Sony’s full line of Xperia cellular phones includes the
following models: Z3 LTE, Z3 Compact, Z2, T3, M dual, M2, M2 LTE, Z Ultra LTE, Z Ultra, Z
LTE, Z1 compact and the Z1 LTE (3) The two latest mobile phones to the market are the Sony
Xperia Z3 LTE and Xperia Z3 Compact. The Xperia Z3, which is available in two models the Z3
LTE and Z3 Compact (127). The Z3 phones are both very similar, both include the following
features: contain the highest waterproof rating, up to two days battery life for long lasting
performance, steady shot technology with Intelligent Active Mode, and audio feature which
include, S-Force Front Surround, Hi-Res support, DSEE HX (127). The only real notable

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difference between the two phones is there size. The Z3 LTE possesses a display screen size at
5.2-inches while the Z3 Compact has a 4.6-inch display screen. All Sony phones are available for
purchased unlocked, meaning the consumer can choose the service provider for the phone. The
only downfall to this is that the phones are only compatible with two of the major service
providers: AT&T and T-Mobile. One of the best features Sony’s mobile phones have is they are
programmed by Android Technology.
Price
In this section of the marketing mix the pricing strategy used by Sony Corporation will be
covered. Sony has been trying to differentiate their products from the saturated market of
consumer electronics for the past few years now. Also, the company’s originally projected sales
on most products aren’t as high as they had hoped. In an effort to fix these problems, Sony took a
risk and attempted to use unilateral pricing as a pricing strategy. By taking this route it should
help the company boost its profits. By choosing this route would mean fixing products prices all
across the board. Unilateral pricing is when the manufacturer of the products lets the retailers
know that products prices can’t be priced lower than a minimum price, which is set by the
manufacturer (128). Through this pricing strategy Sony actually raised the prices of their
products, which in turn may make their products harder for retailers to sell. But Sony has already
thought of this to ease higher prices. Sony has told retailers to make sure all of their products are
being shown are in working order. The company has also set out to train their retailers’
employees to enlighten them on the Sony products and to make sure the employees know
everything there is to know about the products they are selling (128). Another reason Sony
choosing unilateral pricing is risky move is because consumers love the idea of bargaining and
with set price set by Sony the consumer loses that ability to bargain with retailers on the price.

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Take shopping on the internet foe example, consumers have to ability to snag much better deals
online than they do in store, this is one of the main reasons why Amazon does so well. So by
Sony choosing unilateral pricing, this may put an end to finding cheap deals on their products
online (128). In return Sony will mostly likely end up losing business because consumers will
not want to pay for their high prices when they can purchase a competitor’s product, which may
even be better, at bargain price.
Place
Sony Corporation distributes its products around the world through partnerships with
retail stores like Best Buy and Wal-Mart that utilize in store strategies. Sony also sells its
products through their own brand stores located around the world. For the United States, it may
not be like that for very much longer. Since Sony products in the in the United States are
available through retailers like Best Buy and Amazon, the company has decided to do away with
20 of its 31 Sony stores by the end of 2014, which only leaves eleven stores total across the
United States. (129).
Promotion
Sony sponsors one of the most watched sporting events, which airs every four years: The
World FIFA (Federation International de Football Association) Cup Championships. Sony is
only one of six official FIFA partners, which is the organization’s highest status (130). This
exclusive partnership gives Sony preferred marketing, advertising and promotional rights to all
FIFA competitions (130). This promotion is exposed to billions of people around the world who
through watching this tournament are exposed to the Sony name. A key component to this
partnership is that it allows the two organizations, FIFA and Sony, to globally associate with the
emotion and excitement of football (130) (or soccer in the U.S.).

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C. Relevant Information Regarding Current Corporate Structure, Leadership Transitions,
or Management Team of Key Competitors
Competitor #1 – LG Electronics
LG Electronics removed the Circulating Investment Structure of its affiliated companies
by launching a holding company system; this enabled the holding company to take full charge of
investments. They now have been able to focus on their own businesses while increasing the
overall value of the Company. This corporate governance structure has laid the groundwork for
increasing managerial transparency, through a responsible management system comprising of the
CEO of LG Electronics and a Board of Directors (131). They are making big steps in
strengthening their competitiveness at both their domestic and international level, in order to
maximize their corporate and shareholder value. Their Board of Directors maintains
independence from its management and major shareholders. It is comprised of seven directors;
four of the seven are outside directors (131). The Board of Directors is supported by three Board
Committees, which are the Audit Committee, the Outside Director Candidate Recommendation
Committee and the Management Committee (131). The Audit Committee consists of three
Outside Directors, and is responsible for examining corporate financial records and accounting to
ensure compliance with the accounting laws and transparency. The Management Committee
reviews and determines the agendas delegated by the Board of Directors and ordinary
management activities (131). Top management and executives are evaluated to determine
whether they have set and achieved challenging goals, whether their job objectives composed of
quantitative and non-quantitative factors were achieved, also their capability through fair and
objective process, and appropriate compensation corresponding to the outcome of the evaluation
is determined (131).

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Bon-joon Koo is the Vice Chairman of LG Electronics, Representative Director/ CEO
and Inside Director since 2010 (132). He is the grandson of In-hwoi Koo, the founder of the LG
Group. Before he was appointed to Vice Chairman of LG Electronics he served as the Vice
Chairman and CEO of LG International (132). From 1999 to 2006, Koo created and led the joint
venture LG. Philips LCD, which became LG Display in 2008. He set the stage for LG Display to
become the leading global LCD manufacturer that it is today (132).
LG Electronics has their own way of managing with their “Jeong-do Management” which
embodies their high ethical standards and doing business in a transparent and honest manner
(133). They started with their customer-value creation and people-oriented management that are
basic management philosophies that insure that they will accomplish their business activity goals
(133). Then the “Jeong-do Management which mean they will succeed through the constant
development of capability based in ethical management. LG ‘s vision is to become the market
leading company with broad market recognition (133).
For this year their key sustainability management initiatives are to continue strengthening
their fundamentals. Their product leadership, which is a key prerequisite for being market leader,
continues to improve and their fundamentals are becoming stronger across their entire
organization (134). They will apply everything that they have accomplished in order to lead the
market with differentiated products and services that only they can deliver. They are securing
their “differentiated product leadership” by fully aligning their thoughts and actions with the
market and customers, constantly generating new ideas (134). For them it is so important that
they transform their work and management style to be fully aligned with their customers needs.
LGE is implementing four strategic tasks: Corporate Social Responsibility Change Management,
CSR Risk Management, Stakeholder Engagement and Strategic Social Contribution (135). From

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product Research and Development through purchasing, production, sales and after sales service,
LGE is determined to improve its CSR execution while strengthening its efforts to build
consensus and partnership with stakeholders (135). For their CSR Risk Management they want
to establish a monitoring system, respond to stakeholders’ requirement and regulations, perform
risk self-assessment and audit of high-risk group (135). For their strategic social contribution
they want more employee participation, contributions using LGE technology and products and
global partnership programs (135). For their CSR change management they want to comply with
international CSR standards, support management of corporate CSR issues, support decision-
making and operate CSR council, and train employees (135). LG is becoming a more powerful
company every year in 2012 they were named by Forbes one of the most powerful brands in the
world (136). It also is one of Forbes Global 2000 leading companies in the world, which are the
biggest public companies (136).
Panasonic Corporation is comprised of various business domain companies from AV to
home appliances, to industrial solutions and other consumer electronic products. Each company
has its own Research and Development, production, and sales functions that satisfy specific
consumer needs worldwide. Its Board of Directors controls Panasonic management. The
Company’s Board of Directors is composed of seventeen Directors including three Outside
Directors. In accordance with the Company Law of Japan and related laws and ordinances, the
Board of Directors has ultimate responsibility for administration of the Company’s affairs and
monitoring of the execution of business by Directors (137).
The Company has an ideal management and governance structure for their four
Divisional Company-based management structures. Under this structure, the Company has

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empowered each of four Divisional Companies and business divisions through delegation of
authority (137). They employ an Executive Officer system to provide for the execution of
business at its various domestic and overseas Group companies (137). This system facilitates the
development of optimum corporate strategies that integrate the Group’s comprehensive strengths
(137). The Company has twenty Executive Officers which include senior managements of each
of four Divisional Companies, senior officers responsible for certain foreign regions and officers
responsible for corporate functions (137).
Kazuhiro Tsuga is the President of Panasonic Corporation since 2012; under his direction
the company is now moving forward to achieve its goal of becoming the electronics industry’s
leader in green innovation by the time it celebrates its 100th anniversary in 2018 (138). Tsuga
joined Panasonic, then known as Matsushita Electric Industrial Co., Ltd., in 1979. Prior to taking
on the leadership of the global company, Tsuga was President of AVC Networks Company, the
internal arm responsible for Panasonic's audiovisual and information technology equipment
business, from 2011, and served concurrently as Senior Managing Director and Member of the
Board (138). From 2008 to 2011, Mr. Tsuga led Panasonic's Automotive Systems Company as
President while serving as Managing Executive Officer of the corporation. During this time, he
revived Panasonic's automotive electronics business and laid the foundation for its expansion
(138).
Panasonic Corporation’s Basic Management Objective was formulated in 1929 by the
company’s found, Konosuke Matsushita (139). Their Basic Management Objective is
"recognizing our responsibilities as industrialists, we will devote ourselves to the progress and
development of society and the well-being of people through our business activities, thereby
enhancing the quality of life throughout the world" (139). It is their business philosophy that

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embodies their mission and devotion to the progress of society and the well being of the people
worldwide through their business activities (139).
Panasonic Corporation created a Midterm Management Plan to reach their goals in 2016.
Their main objective is lo immediately eliminate unprofitable businesses (140). They want to
strengthen each business division; they will be responsible for Research and Development,
production and sales as well as their balance sheet to increase sustainable cash and profit (140).
To eliminate all unprofitable business divisions they will change the structure of business. They
will introduce rugged smartphones for the business-to-business market (140). We will also
outsource Research and Development and manufacturing to reduce its fixed costs (140). Also
they want to expand business and improve efficiency shifting from in-house approach (140).
They also want to improve their financial position. They are going to improve by disposing
assets and reducing inventory to decrease working capital. Cash will be used mainly to reduce
debt and put them back close to a positive net cash position (140). They will also promote energy
related field in their device business. They have expanded the solar panel business not only in
residence or buildings but also in automobiles; and also the storage battery business in energy
saving systems and automobiles (140). Panasonic is making as much as they can in order to grow
and strengthen their company. They are in the list of Forbes Global 2000, which are the world’s
biggest public companies (141).
Competitor #3 – Samsung Electronics
The Board of Directors administers the performance of management, sets corporate
management policies, and makes strategic decisions on business execution. It is composed of
four executive directors and five independent directors (142). It consists of an independent
director majority o both guarantee the board’s independence and transparency. Also the Board

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establishes a transparent decision-making process with inputs from a broad spectrum of outside
experts (142). The independent directors meet separately from the executive directors in order to
promote a free exchange of ideas on all aspects of the company's management (142). All
directors are prohibited from engaging in business activities within the same industry without the
approval of the Board of Directors (142).
Oh-Hyun Kwon has been the Vice Chairman and Chief Executive Officer at Samsung
since 2012 (PDF5). He also serves as the Vice Chairman and Head of Samsung Advanced
Institute of Technology (PDF5). Mr. Kwon has been the Vice Chairman and Head of Device
Solutions since 2011. Before that, Kwon was the President and Head of Semiconductor Business
at the company (PDF5) He also served as the President and Head of System LSI Division at the
company. In 2000, Kwon was appointed as the Head of LSI Technology at the company. He also
served as the Head of ASIC Business at Samsung (PDF5).
Jong-Kyun Shin has been the President and Chief Executive Officer at Samsung since
2013 (PDF5). He has been the Head of IT & Mobile Communications Business at Samsung since
2012. Previously from 2009 to 2011, Shin was the Head of Mobile Communications Business at
the company (PDF5). He was also the Head of R&D Team of Mobile Communications Business
at Samsung from 2006 to 2008 (PDF5).
Boo-Keun Yoon has been the President and Chief Executive Officer at Samsung since
2013. He has been the President and Head of Consumer Electronics at Samsung since 2012.
Previously from 2007 to 2011, Yoon was the Head of Visual Display Business at the company.
He was the Head of R&D Team of Visual Display Business at Samsung from 2003 to 2007
(PDF5).

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Sang-Hoon Lee has been the President and Chief Financial Officer at Samsung since
2012. Previously from 2010 to 2011, he was the Head, Strategy Team 1 of Samsung Corporate
Strategy Office at Samsung. From 2008 to 2010, Lee was the Head of Corporate Management
Support Team at the company. He also served as the Head of Strategy and Planning Office at
Samsung from 2006 to 2008 (PDF5).
The Board of Directors is also composed of five Independent Directors, which are Eun-
Mee Kim, Han-Jong Kim, Kwang-Soo Song, Byeong-Gi Lee, and In-Ho Lee. All of them started
in the Board of Directors in 2012 or 2013 (PDF5).
In 2013 Samsung Electronics extended its market leadership in core businesses, including
the mobile communications, TV and memory chip businesses (PDF5). In mobile
communications, due to excellent smartphone performance, they achieved the remarkable result
of number one ranking in both sales and market share to solidify their industry leadership. In the
TV business, they were number one in sales, achieving that rank for the eighth consecutive year,
as well as leading the industry in profitability. Their memory business saw significant gains in
2013, owing to improved cost savings and advanced process technology development, which
helped boost sales of differentiated and high-value-added products such as SSDs (Solid State
Drive) (PDF5). For the 22nd consecutive year, their memory business achieved Number one
global market share, which they have held since 1993 (PDF5).
Samsung continued to reinforce their core competencies in Research and Development
and design by recruiting outstanding talent and by restructuring. By establishing an open
innovation system, they strengthened partnerships with outside research institutes and launched
new professional organizations, such as Softech and the Big Data Center, to strengthen their
software capabilities (PDF5). They are building a new Research and Development Center to

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develop future technologies including materials. Anticipating future growth engines, they have
focused resources and capabilities on health and medical equipment; B2B services and life care
areas, such as Smart Home and mobile health applications (PDF5). These new technologies and
services are attracting favorable reviews both in Korea and abroad.
Samsung will focus on sound management to increase profitability. They expect to fortify
resource management efficiency companywide, including in investments and global supply chain
management capability, which will result in improved performance (PDF5). They expect to
reorganize systems in order to enhance response time, minimize management risk or uncertainty
and monitor ongoing compliance (PDF5). Fortune listed Samsung Electronics 21st on its
World’s Most Admired Companies list (PDF5).
Samsung is making a big push into being the center of the smart home today with its
acquisition of SmartThings, which allows people to sync up their connected devices onto a single
smartphone app and hardware hub (144). SmartThings will operate as an independent company
and will be moving from its home base of Washington D.C. over to Samsung’s Open Innovation
Center in Palo Alto (144). The Open Innovation Center is an investing arm and startup
accelerator for U.S. companies that Samsung is interested in. With this acquisition Samsung will
keep on growing and innovating new products.
Competitor #4 – Sony Corporation
Sony management is governed by its board of directors, which is appointed at the annual
shareholders meeting. Inside the board there are three committees each of them with a different
function, the Nominating Committee, Audit Committee and Compensation Committee. Each of
these committees consists of directors named by the board that also oversee the management of
Sony Group's business operations, appoint and dismiss the statutory committee members,

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appoint and dismiss Representative Corporate Executive Officers and Corporate Executive
Officers (146).
Mr. Osamu Nagayama is Sony Chairman of the Board of Directors since 2013 and
Independent Director, and he is also member of the Nominating Committee that determines the
content of proposals regarding the appointment and dismissal of Directors (146). The Audit
Committee is in charge of monitoring the performance of Directors and Corporate Executive
Officers. As for the Compensation Committee they set policies on the contents of individual
compensation for Directors, Corporate Executive Officers, Corporate Executives and Group
Executives (145)
Another important figure in Sony’s management is their president Kazuo Hirai. Mr. Hirai
has been serving as President, Chief Executive Officer, Representative Executive Officer and
Director of Sony since June 2012. He is a member of Nominating Committee. He used to serve
as Vice President, Executive Vice President and Executive Officer in the Company, and worked
for another subsidiary of Sony (146).
Masaru Kato is the Vice Chairman at Sony since 2014. He joined Sony in 1977 and held
variety of positions, including Representative Corporate Executive Officer, Executive Vice
President and Chief Financial Officer and others. Also another important executive is Mr.
Kenichiro Yoshida. Mr. Yoshida was named Chief Financial Officer, Executive Vice President,
Representative Executive Officer and Director of Sony in June 19, 2014. He joined the Company
in April 1983 (146).
It was March 27 of 2012 when Sony announced the establishment of a new management
structure. President Kazuo Hirai led the change, these changes intended to drive revitalization
and growth across Sony's core electronics businesses, and deliver compelling user experiences

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through convergence of the unique assets in place throughout the Sony Group (147). With their
new management team their goal is to accelerate decision-making and execution while they
create a foundation for revitalizing the electronics business and repositioning it for growth
(PDF6).
With the new team they made key decisions aimed at creating new businesses while
strengthening core businesses. Among those decisions were decisions on investments to expand
their CMOS (Complementary metal-oxide-semiconductor) image sensor manufacturing capacity;
the acquisition of Gaikai, Inc., which is a United States based developer that provides interactive
cloud-based gaming services (PDF6). Sony also established Sony Olympus Medical Solutions
Inc., which is a joint venture with Olympus Corporation that plans to deliver new innovative
medical products, such as surgical endoscopes, and new medical and imaging systems solutions
business (PDF6). Sony also realigned their business and asset portfolio and strengthened their
financial position. Some of the decision made include the sale of the chemical products-related
business, also the sale of assets including their U.S. headquarters building in New York City
(PDF6). In order to increase efficiency and reinforce their business infrastructure, they
implemented structural reforms including optimizing resources and restructuring their marketing
organization in developed markets, consolidating certain manufacturing operations in Japan, and
expediting measures to reduce headquarters headcount (PDF6).
Sony also executed various initiatives to turn around the electronics business by working
to strengthen their mobile, imaging and game businesses; their three core electronics businesses,
turning around the television business, and expanding their business in emerging markets
(PDF6). They also improved profitability in their entertainment and financial services
businesses, both of which already contributed stable profit (PDF6). Profitability in their pictures'

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businesses grew through the successful release of several global hit movies, including The
Amazing Spider-Man, and the latest James Bond film, Skyfall, and the expansion of its
television networks, production and its distribution businesses (PDF6). Market share and
profitability in the recorded music business benefited from their efforts to discover, nurture and
develop new artistic talent such as One Direction, who achieved significant global success in
fiscal year 2012 (PDF6). Their financial services business also grew its revenue and operating
profit by delivering financial products and services, primarily life and non-life insurance, with
high customer satisfaction (PDF6).
2. Discussion of Relevant Economic Factors Affecting the Industry
Sharp is in an Oligopoly market. The market is run by companies with similar products such
as TV’s, and energy solutions.
Leaders
Overall Consumer Electronics and LCD:
Overall, evidenced by the financial positions of Sharp and its competitors, Samsung is a
clear leader. They’ve reached that point taking over areas that other companies specialized in.
Originally they overtook the LCD market from Sharp who was a major part of developing the
technology through the decades in the late 20th century. This was evident in Sharp’s and
Samsung’s historical analysis. Samsung is now the clear leader in the LCD market. Samsung
also has successfully infiltrated the Apple iPhone market by copying much of Apple’s design,
but with upgrades Apple was holding off on to utilize with their forced obsolescence strategy
(149).
Energy Solutions:

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Panasonic is a leader in energy solutions amongst the four of Sharp’s highlighted
competitors in this report. Sharp appears to have the better technology, however, Panasonic is
garnering more attention with partnerships and winning multiple major specific contracts
(150)(151). Sharp has more of a focus on business to business installation of energy solutions,
while Panasonic does both business to business and business to consumer (152).
Policy
LCD TVs
As discussed in Sharp’s SWOT analysis the market has been involved in multiple price
fixing lawsuits with multiple competitors. This is a typical side-effect of an oligopoly based off
of the idea of Game Theory. The idea is that collusion is attractive to businesses in an oligopoly
because together they can prevent new entrants, increase profitability, and just overall reduce
uncertainty for businesses by essentially working together as a monopoly (153). This practice is
outlawed by the US Anti-trust law, but the numerous price-fixing lawsuits make it clear the anti-
trust law has not been a significant enough deterrent to prevent collusion amongst competitors in
the LCD TV market.
Energy Solutions
Currently the market for renewable energy is taxed with high costs. Once these costs
decline then the market growth should skyrocket quickly (154). However, market growth in
renewable energy has declined in the past 78% in the past four and half years (155). In 2014 this
aspect of the market finally saw a rise that many believe is a signal of an end to the decline
(155). This is mainly attributed to decreasing costs in photovoltaic cells for solar panels, the
beginning of what this side of consumer electronics needs to make the market grow (155).
Market Share

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LCD TVs:
As shown through the historical analysis and now further with the above chart, Sharp has seen a
decline in market share for LCD TVs while Samsung has dominated the market (156). It is clear
LG Electronics is beginning to close the gap that Samsung has managed, but that has not
hindered Samsung’s growth as the overall dominating market share for LCD TVs, the aspect of
the market Sharp is currently most focused on.
Energy Solutions
The market for renewable energy is currently smaller than most others because of policy issues.
However, the market is expected to see major growth in the coming years with reduced costs in
renewable energy as described in the Policy section.

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Macro-Environmental Factors
 Social
o Wearable Technology-A Recent social trend is that of wearable technology. It has
taken off in 2014 with the interest in health tracking technology that wraps around
wrists, in shoes, and on ankles (157). In addition the google glass technology is
one of the newest products drumming up major interest, in addition to the latest
virtual reality tool, the Oculus Rift that got its start through a Kickstarter
campaign (158). All of these products opened up major new markets.
o Social Media-The interest in social media continues to expand into different
directions as more Twitter and Snapchat are the current trending social media
devices.
 Technology
o Short Product Life-Span-Many successful technology companies are running a
strategy of forced obsolescence which has them coming out with new updated
products every year. This has created a short product life-span for successful
products.
o Wearable Technology-While this is listed as a social trend it is also a
technological trend.
 Environmental
o Sustainability-A major push for an environmental trend is to increase the product
life-span of products (159).
o Clean Energy-Clean energy is something that has been and continues to be pushed
for to improve the world’s ecosystem.

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 Economy
o Global-With the aid of technology the world economy is shrinking making it easy
for transactions on complete opposite sides of the world to be completed within a
week.
o Bull Market-The economy has recovered from its 2008 crash and is currently
strong with trends of increasing consumer confidence.
 Political/Legal
o Stagnant-The political system has been in gridlock the past couple years, there is
no indication of this changing with the recent increase in Republicans to take over
Congress.
Implications: Consumer Electronics has the most to gain with the trend of Wearable
Technology. Sharp still has the ability to not fall behind while the trend is still new. This could
then be incorporated with the clean energy technology they have already been developing. With
an increasingly global economy and a strong market, the market is in a good position for
expansion. A stagnant political system makes for a favorable environment when it comes to
creating new market policies.
3. Dominant Economic Factors
Note: All Information in this section is used from various previous sections.
Market Size and Growth Rate
As discussed in the relevant economic factors, Consumer Electronics is in an Oligopoly
with several large companies controlling a saturated, stagnant market preventing new entrants.
The two specific market segments inside consumer electronics Sharp is focusing on, TVs and
Energy Solutions, are on two different trajectories. As discussed in the relevant economic factors

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the TV segment is ruled by Samsung and LG and the market itself is done growing, as TVs have
reached all populations.
The renewable energy segment is small and growing at a slow rate. As discussed in the
relevant economic factors, it is on the verge of growing large rapidly once costs drop in order to
have an appeal to a larger consumer base. Costs have already begun to drop with photovoltaic
cells that are used in solar panels, as discussed in the relevant economic factors section.
Scope of Competitive Rivalry
The consumer electronics industry is an industry on a global scale. Sharp is located in
Japan. Sharp’s competitors are located in other Asian countries, but they all sell consumer
electronics on all six populated continents. The true global stance of this industry is identified
throughout the historical analysis as all five companies slowly expanded to a global scale
throughout their histories.
Demand-Supply Conditions
Profit margins are dropping as competitors compete with each other’s prices. This is
apparent through the high cost of sales compared to revenues; this is before taking into account
other overhead and non-operating expenses. This small margin is likely present in the industry
because differentiation is becoming increasingly difficult in a saturated industry filled with many
major players.
Market Segmentation
Consumer Electronics is divided into dozens of segments. Every company has their hands
in tens of different types of electronics. This includes TVs, computers, phones, video game
consoles, renewable energy, and appliances. These products are all segmented by their
characteristics into distinct segments.

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Pace of Technological Change
In order to stay as a major player in the Consumer Electronics industry companies must
continually research and develop new technology. Most segments continually update their
products every year with the exception of most TVs and appliances. If a company is unable to
keep up with this yearly change they are likely to fail fast.
4. Identification of Key Competitive Forces in the Industry
The Five Forces models of competition are five competitive forces that affect industry
attractiveness. The five forces help determine the industry’s strengths and weaknesses. The five
forces are buyer bargaining power, threat of substitute products, supplier bargaining power,
potential of new entrants in the industry, and rivalry among competing sellers. Each of the forces
gives a good diagnosis of the competition within an industry.
The competitive force of buyer bargaining power is all about the consumers. According
to the text this force is about the buyers having sufficient bargaining leverage to obtain price
concessions and other favorable terms, and the extent to which buyers are price sensitive. In the
consumer electronics industry there is a lot of competition. The buyer power is a strong
competitive force in this industry. Since there are so many different companies inside the
consumer electronics industry, buyers have strong power because they can easily go to other
competitors, since many products in the industry are the same between companies. For this
industry buyer switching cost to competing brands is low, that gives the buyers more power
against sellers. Also in this industry buyers have the ability to postpone purchases until later if
they do not like the prices offered by sellers, giving them power over the sellers. An example in
the industry in which buyers have strong power over their sellers is in choosing between an
Apple IPhone or a Samsung Galaxy phone, there is a low switching cost since the products are

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similar and quality is similar too, just a little difference in some things but both basically perform
as good as the other one.
The competitive force of substitutes products is about companies in one industry who are
vulnerable of the actions of other companies in another industry, when consumers see products
of another industry as substitutes. The competitive pressure from substitutes is strong when there
are good substitutes are available or new ones are emerging. The competitive pressure from
substitutes is weak when good substitutes are not ready available or just do not exist. For
consumer electronics there is not another industry that can be a substitute for their products.
Consumer Electronics is an industry that as an industry it does not have substitutes but within the
industry and its products their products have various substitutes.
The competitive force of potential new entrants has several factors that determine whether the
threat of new companies entering the market present competitive pressure. For the consumer
electronics industry there is a high barrier in order to enter. Since it is an industry where high
capital is required, there is a large total dollar investment needed to enter the market
successfully. Also it is a difficult industry to make a name and have brand recognition, since
many companies have done an excellent job with their branding. Also another factor is with
networking, there is a challenge on building a network of distributors-retailers and also securing
space on retailer shelves. Retailers can be cautious on accepting a new product where there is
low brand recognition because it can affect their sales. To enter the retailers and compete with
other companies who already have brand recognition, new entrants will have to cut their prices in
order to get retailers to provide dealers and distributors with higher markups and profit margins
or by giving them big advertising and promotional allowances. For consumer electronics
industry there is a big threat with new companies entering the market.

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The competitive force of supplier bargaining power depends whether the suppliers of the
industry represent a weak or strong competitive force depending on the whether the supplier has
sufficient bargaining power. In this industry the suppliers have high bargaining power due to
several reasons. The first reason is about the supplier providing a differentiated input that
enhances performance, quality or image of the industry’s product especially in the consumer
electronics industry where quality and product innovation are key requirements in the products.
Another reason for the supplier having high bargaining power is industry members having a high
cost in switching their purchases to alternative suppliers. Since many of the big companies are
their own suppliers there has to be a high cost of switching to another supplier. An example is
Apple and Sharp, Sharp is supplying apple their LCD screens for their iPhones and IPads, since
Sharp’s LCDs are high quality and have good performance, they have a high supplier bargaining
power over Apple; since they are providing them with high quality raw materials in order for
them to use them for their high quality and differentiated products.
The competitive force of rivalry among competing sellers is high in the consumer
electronics industry. Consumer electronics is an industry that is globally growing and there is
high competition. For this industry competing sellers are active in making fresh moves to
improve their market standing and business performance. Many consumer electronic companies
are trying to differentiate their products in order to increase their demand and differentiate
themselves from other companies, so that keeps on the rivalry high. Also another factor is that
buyers’ cost of switching to another seller is low. Meaning that there are so many options in
retailers’ stores of buying consumer electronics that switching cost to another seller is low.
Rivalry increases also when one or more competitors become dissatisfied with their market
position; when firms are in financial trouble and pursue an aggressive strategy of lowering their

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prices, greater advertising or merge with other rivals. In consumer electronics there are always
companies who give discounts for example in Best Buy they have many discounts for certain
brands, that influences the buyer in deciding which brand to buy specially if there is not much
differentiation in the products. Definitely in this industry there is a high force of rivalry among
competing sellers.

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5. Discussion of the Current Driving Forces in the Industry
Industry driving forces “are forces outside the firm (external factors) that trigger the
change of strategy in an organization” (160). Industry participants alter their actions based upon
the actions of their competitors. The current driving forces in the consumer electronics industry
are increasing globalization, product innovation, marketing innovation, entry or exit of the major
firms, changes in cost and efficiency, changing societal concerns, attitudes, lifestyles. Increasing
globalization is one of the driving forces because this how the companies grow and introduce
their products to new markets. A company may start at the regional level, then grow to the
national level, then the national level, then international level, and then finally have products
available on the global market. Companies will also tend to move where costs are the lowest to
produce their products, so they can make higher profits margin in that area. Consumer electronic
companies compete with one another to be the first company to a new market to gain an
advantage on one another. Another driving force of the consumer electronics industry is product
innovation. This can be key for companies because having new innovations offered in your
products can attract first time buyers, which helps industry growth and creates distance or
narrows the gap between you and your rival’s products. The next driving force is marketing
innovation, which challenges companies to bring their products to market to spark the
consumer’s interest in what they have to offer. By a company market a product a correctly, this
can lead to a wider industry demand, differentiate the company’s product from competitors,
lower the cost of the product, and lastly can alter competitors positions and cause strategy
revisions. Entry or exit of the major firms is another industry driving force for the consumer
electronic industry. When a large amount of foreign companies enter domestic dominated
industry the competitive conditions change drastically. Usually when this happens a company

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from another industry may also attempt to enter this other industry through two ways: one
through acquisition of an existing company or two start their own company. The next driving
force in the consumer electronics industry is changes in cost and efficiency. Having a variety of
costs in an industry among competitors can change the state of the competition and how they go
about pricing their producing and pricing their products. By a single company have more
affordable models offered it can cover the lower-income households while still have their more
expensive models as well to cover the entire markets need for that particular product. The final
driving force in the consumer electronics industry is changing societal concerns, attitudes, and
lifestyles. In this modern day peoples’ lifestyles are constantly changing and these companies
have to keep up with the latest updates to keep up the changing lifestyles. For some the concerns
of a product can make or break if they are going to purchase that product. If a company uses
harmful chemicals in their products or doesn’t discharge chemicals used in producing the
product correctly, then that person can easily purchase a competitors product. All of these forces
can major contributors to how companies in the same industry go about try to out compete one
another for dominate share in the market and to gain attention of the consumers so they will
purchase their products over a rivals.
6. Creation and Discussion of Strategic Group Map
Note: All data in this section was compiled from previous sections

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The Consumer Electronics industry has varying degrees of differentiation and financial
success. These aspects are measured by the strategic group map above.
Samsung manages to differentiate the most with their brand name and their unique ability
to attack existing leaders in Consumer Electronics market segments. In addition they are one of
the most financially successful companies amongst Sharp’s competitors.
Sony has managed to differentiate themselves with their PlayStation console and high
quality audio accessories. Their movie and music business has gone a long way to assisting them
in their strong financial success.

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LG Electronics is still differentiating by selling to higher-end consumers. They align with
their products to consumers and that is a large reason why their market share has continually
grown over the past five years. However, their cost of sales cuts into a major portion of their
revenue, which is the major reason their financial success is so low.
Panasonic was differentiating, but now appears to be restructuring their business and
shifting to a best-cost provider. They have been outsourcing to reduce costs, eliminate
unprofitable businesses and restructuring marketing. This is likely a response to their low
financial success.
Sharp is currently sitting at a best-cost provider strategy making them the least
differentiated of the five companies in this report. In addition they are also in the least financially
successful position because they have had a negative profit margin the past three years. Only in
2014 Sharp was able to create a profitable year.
7. Identification and Discussion of Industry Key Success Factors
An industry’s key success factors are those competitive factors that most affect industry
members’ ability to prosper in the marketplace. They may include particular strategy elements,
product attributes, resources, competitive capabilities, or intangible assets. These key factors are
very important to future competitive success that all firms in the industry must pay close
attention to them or risk an eventual exit from the industry. There are various key success factors
in the consumer electronics industry.
Another key success factor in the industry is the ability to make high quality products,
especially in this industry where customers insist on product reliability. In this industry the
consumers are looking for the best quality products. Having the best quality products gives the
firm a competitive advantage over other firms. This industry is so big that quality in their

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products is a big thing, which firms need in order to survive, since there is a lot of competition.
An example is in a retailer if you buy a television of a particular brand and after a while it stops
working or has a defect, you can take it back and they will let you change it, and you can pick
another brand for the same price or pay the difference. People after experiencing the low quality
product of a particular brand, they tend to change to other brands. So quality is definitely a key
factor in this big industry.
Another key success factor for the industry is their ability to respond to demand. Society
has demanded technological production for the past several decades. Since the beginning of the
consumer electronic industry they have tried to respond to the demand efficiently by providing
customers with technology products. A good example is the mobile devices sector after the
appearance of the first mobile phones; the public has demanded more innovative devices. This
led to the invention of color displays and integrated cameras as well as business applications in
the mobile devices (161). This industry is a very demanding industry in which innovation is
always a key for the firms, consumers always want more and more. Definitely their ability to
respond to the demand is a key factor in the industry.
Another key success factor is their ability to compete and keep up with competition.
Competition is the moving force of every production because by competing, companies come up
with more and more innovative technological products (161). This is evident in the success of the
electronic industries. A report by the leading technology experts IBM indicates that through
competition between Japanese electronic companies and western corporations, the industry has
developed more attractive products and has incorporated more advanced technologies (161).
Another example is the competition between Sony and Microsoft has led to the distribution of
two of the most successful game consoles, the PlayStation and Xbox (161).

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Another key success factor in this industry is their talented workforce. This industry
offers some of the most attractive employment opportunities in terms of environment and labor.
EHS Today Magazine concludes that by providing comfortable social conditions and especially
by increasing the pay rates for technology specialists in developed countries, electronic
industries have become a sought-after employer for educated individuals (161). This gives the
technology companies the opportunity to manage talent in their organizations and to enjoy
progressive work by specialists (161). Expertise in this industry is key, since it is an industry in
which firms have to keep on innovating products in order for them to survive against their rival
firms.
The ability to lower their costs in manufacturing is a key factor in the industry. Many
American and European technology giants have successfully exported their productions abroad,
many companies have assembly plants in Asia and pay less for production resources and labor
costs (161). Specialists from the Warwick Institute for Employment Research concluded that
such companies receive the same level of production quality by their employees and pay less for
their labor (161). By doing that firms can save costs and enhance revenue rates and production
quality. An example of organizations that have done that are Intel and Nokia who have their
assembly plants in countries like Thailand and China where the labor costs are lower that in the
United States (161).
Another key success factor is a marketing related factor, which is having a well-known
and well-respected brand name and also advertising. When consumers purchase products, they
will consider the brand first, because it indirectly leads consumers to associate with the quality,
functions, and design of products (162). Having a well-known brand in this industry is a difficult
thing to accomplish, but many brands have accomplished that and have done a great job. Firms

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in the industry accomplish this with their high performance, making consumers trust them about
their product and making them trust that what they buy is worth their money. Also with their
marketing, companies in the industry are always creating new products that they market so the
consumers can know about the new products. Advertising in this industry is a key factor in order
for their consumers to know what is happening so they can go out and buy the products.
Consumer electronics have many key success factors, which give firms competitive advantage
over other rival firms.

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Works Cited – Section 2
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34. http://www.therichest.com/business/technology/the-10-most-expensive-televisions-in-
the-world/

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35. http://tinyurl.com/kngztsk
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49. http://www.sharp-solar.com/en/mega_solar/index.html
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56. http://www.sharp-solar.com/en/solutions/celltype/index.html#monocrystal
57. http://www.asean.org
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60. http://sharp-world.com/corporate/eco/report/ssr/social/customers/satisfaction/
61. http://www.sharp-pci.com/en/campaign/
62. http://www.sharp.net.au/articles/current-promotions/sharp-promotions/
63. http://www.sharpusa.com/AboutSharp/NewsAndEvents/PressReleases/2014/June/2014_0
6_17_InfoComm2014.aspx
64. http://www.sharp-world.com/corporate/info/social/
65. http://markets.ft.com/research/Markets/Tearsheets/Business-profile?s=6753:TYO
66. http://www.reuters.com/finance/stocks/companyOfficers?symbol=SHCAY.PK&WTmod
LOC=C4-Officers-5
67. http://sharp-world.com/corporate/info/ci/board/index.html
68. http://www.bloomberg.com/news/2013-05-13/sharp-to-name-kozo-takahashi-as-
president-nikkei-says.html
69. http://www.bloomberg.com/news/2013-09-18/sharp-board-meeting-to-discuss-capital-
increase-forecast-change.html
70. http://blogs.wsj.com/japanrealtime/2014/01/09/sharp-pres-trying-to-change-inward-
looking-corp-culture/
71. PDF 3

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72. http://www.sharp-world.com/corporate/ir/governance/policy/
73. http://www.marketingteacher.com/pricing-strategies/
74. http://www.sharpusa.com/customersupport/wheretobuy.aspx
75. http://www.mynewsdesk.com/sg/qnet/news/sharp-chooses-qnet-s-e-commerce-direct-
selling-platform-to-market-its-proprietary-plasmacluster-ion-air-purifiers-59611
76. http://www.sharpusa.com/CustomerSupport/Authorized-Reseller.aspx
77. http://smallbusiness.chron.com/pricing-strategy-considerations-new-product-1797.html
78. http://smallbusiness.chron.com/premium-pricing-strategy-1107.html
79. http://www.cfr.org/asia-and-pacific/asean-association-southeast-asian-nations/p18616
80. http://www.digitaltrends.com/home-theater/led-vs-lcd-tvs/
81. http://finance.yahoo.com/q/hp?s=066570.KS+Historical+Prices
82. http://finance.yahoo.com/echarts?s=066570.KS+Interactive#%7B%22range%22%3A%2
21y %22%2C%22scale%22%3A%22linear%22%7D
83. http://finance.yahoo.com/q/pr?s=PCRFY+Profile
84. http://panasonic.net/corporate/
85. http://panasonic.net/ir/inquiry/ir_03.html
86. http://finance.yahoo.com/q/pr?s=005930.KS+Profile
87. http://www.samsung.com/us/aboutsamsung/
88. http://finance.yahoo.com/q/hp?s=005930.KS+Historical+Prices
89. http://finance.yahoo.com/echarts?s=005930.KS+Interactive#
90. http://www.sony.com/SCA/About_Us/index.html
91. http://www.sony.com/SCA/who-we-are/overview.shtml
92. http://www.google.com/finance/historical?q=TYO:6758&ei=P2F9VJmhHMSn8gaFiIDI
Cg
93. http://www.lg.com/global/about-lg/corporate-information/at-a-glance/overview
94. PDF4
95. www.lg.com/us/tvs
96. www.lg.com/us/home-theater-systems
97. www.lg.com/us/sound-bars
98. www.lg.com/us/monitors
99. www.lg.com/us/data-storage/all-data-storages
100. www.lg.com/us/computer-accessories/lg-LSM-100-mouse-scanner
101. www.lg.com/us/cell-phones
102. http://www.wiglafjournal.com/marketing/2012/04/lgs-brilliant-marketing-strategy/
103. http://www.lg.com/global/sustainability/customer/communication-with-customers
104. http://www.lg.com/global/about-lg/corporate-information/global-operations
105. http://www.lg.com/us/commercial/display-partners/distribution-partners
106. http://www.investopedia.com/terms/c/competitive-pricing.asp
107. http://www.panasonic.com/au/consumer.html
108. http://www.panasonic.com/au/consumer/tvs-projectors/led-lcd-tvs.html
109. http://www.panasonic.com/au/consumer/tvs-projectors/led-lcd-tvs/th-60as800a.html
110. http://www.marketingteacher.com/pricing-strategies
111. http://articles.economictimes.indiatimes.com/2010-09-11/news/27574937_1_panasonic-
india-director-lcd-tv-direct-cool-refrigerator
112. http://www.ttiinc.com/page/panasonic
113. http://www.bradsdeals.com/stores/panasonic

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114. http://www.panasonic.com/caribbean/consumer/viera-televisions-
learn/feature/panasonic-viera-is-the-official-tv-of-fc-barcelona.html
115. http://www.samsung.com/us/aboutsamsung/
116. http://www.samsung.com/us/mobile/cell-phones/
117. http://www.samsung.com/us/mobile/cell-phones/all-products
118. http://www.samsung.com/us/mobile/cell-phones/all-products
119. http://www.samsung.com/us/experience/uhd-tv/
120. http://www.samsung.com/us/video/tvs/KN55S9CAFXZA
121. http://www.samsung.com/us/video/tvs/UN65H8000AFXZA
122. http://www.samsung.com/us/video/tvs/PN64F8500AFXZA
123. http://www.marketing91.com/marketing-mix-of-samsung/
124. http://www.investopedia.com/terms/c/competitive-pricing.asp
125. http://www.sony.com/index.shtml
126. http://smb.store.sony.com/televisions-video/cat-27-catid-Televisions
127. http://smb.store.sony.com/all-android-smartphones/cat-27-catid-Android-Smartphone
128. http://sony-unilateral-pricing.articles.r-tt.com
129. http://www.theverge.com/2014/2/26/5451012/sony-closing-majority-of-us-retail-stores-
by-end-2014
130. http://www.sony.com/SCA/who-we-are/global-marketing-partners/overview.shtml
131. http://www.lg.com/global/investor-relations/company-info/board-of-directors
132. http://www.lg.com/global/about-lg/corporate-information/executives/office-bios/bon-
joon-koo
133. http://www.lg.com/global/about-lg/corporate-information/jeong-do-management
134. http://www.lg.com/global/sustainability/csr-framework/top-management-message
135. http://www.lg.com/global/sustainability/csr-framework/csr-management
136. http://www.forbes.com/global2000/list/
137. http://panasonic.net/corporate/governance/
138. http://panasonic.net/corporate/management/profile/
139. http://panasonic.net/corporate/philosophy/objective/
140. http://panasonic.net/ir/vision/pdf/20130328_vision_note_e.pdf
141. http://www.forbes.com/global2000/list/
142. http://www.samsung.com/us/aboutsamsung/investor_relations/corporate_governance/bo
ardofdirectors/IR_BoardComposition.html
143. PDF5
144. http://www.forbes.com/sites/aarontilley/2014/08/14/samsung-smartthings-acquisition-2/
145. http://www.sony.net/SonyInfo/News/Press/201203/12-043E/
146. http://www.sony.net/SonyInfo/csr_report/governance/index2.html
147. http://www.reuters.com/finance/stocks/companyOfficers?symbol=SNE&WTmodLOC=
C4-Officers-5
148. PDF6
149. http://www.cnet.com/news/samsung-you-cant-copy-iphone-features-if-iphones-dont-
use-them/
150. http://www.environmental-expert.com/companies/sharp-solar-energy-solutions-group-
36565
151. http://www.panasonic.com/business-solutions/panasonic-awarded-contracts.asp

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152. http://www.greenbiz.com/blog/2014/04/16/under-panasonics-eco-mantra-solutions-
trump-products
153. http://tutor2u.net/economics/revision-notes/a2-micro-oligopoly-game-theory.html
154. http://www.un.org/esa/sustdev/sdissues/energy/op/beijing_re_egm/beijing_re_report.pdf
155. http://www.unep.org/NEWSCENTRE/Default.aspx?DocumentID=2787&ArticleID=10
824&l=en
156. http://www.statista.com/statistics/267095/global-market-share-of-lcd-tv-manufacturers/
157. http://www.techradar.com/us/news/world-of-tech/future-tech/how-wearables-became-
the-key-tech-trend-of-2014-1231194
158. http://www.oculus.com/
159. http://www.trendsactive.com/#!/our-trends/societal-trends/
160. http://www2.uhv.edu/wang/MGT6331/Questions/Driving%20forces%20vs.%20Key%2
0Success%20Factors.htm
161. http://www.ehow.com/info_8031792_key-success-factors-electronic-industries.html
162. http://link.springer.com/chapter/10.1007%2F978-3-642-14616-9_70

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Strategic Plan
1. Discussion of Likely Strategic Maneuvers from Relevant Competitors in the Next 3
Years
Competitor #1 - LG Electronics
Note: All information in this section is deducted from information in previous sections.
LG is a big company in the consumer electronics industry and a firm competitor to Sharp
Corporation. Lately they have been pulling consistent profits, as mentioned before. They have a
high cost of sales partly because they incur heavier expenses as a Broad Differentiation
company. It is likely that LG will have to find the dog or dogs that are creating these high costs.
They need to cut costs to free up a profit margin so they will be able to actively pursue new
technology. After cutting costs LG will appear as a much stronger threat to Sharp, as the
increased profits will provide them with the ability to identify and enter new markets before
Sharp.
As mentioned before in 2012 they started the “Life’s Good” motto, to personalize the
brand, they created a “cheery face” transformation of its LG logo. They also enhanced their
advertising with sponsorships in the highly rated NCAA college basketball tournament, teamed
with Oprah Winfrey to give away refrigerators and televisions, were aggressive about placing
their televisions in hotels and motels, and teamed with CNN to provide televisions at a number
or major airports. It is likely that they will keep on sponsoring big events, and aggressively
placing their products in areas in which there is a large amount of traffic in order to continue to
generate a stronger brand image on both a domestic and international level. As mentioned before
they have been taking big steps in strengthening their competitiveness at both domestic and
international level

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LG’s key sustainability management initiatives are to continue strengthening their
fundamentals with their product leadership, which is a prerequisite for being market leader. It is
likely that they will keep trying to become the market leader.
It is likely that LG will keep their strategy and management style fully aligned with their
customers needs since that is a basic strategic move in order to have product leadership and keep
their customers satisfied which is important for a differentiated company. They will likely keep
on securing their “differentiated product leadership” by fully aligning their thoughts and actions
with the market and consumers, constantly innovating and generating new ideas. It is evident
they have the strength in their Research and Development department in order for them to keep
this strategy as they have innovated many differentiated products in the consumer electronics
industry, such as the first phone with a Bluetooth headset, and the first full LED 3D TV.
A major part of LG’s strategy includes strengthening their Corporate Social
Responsibility. As mentioned before from their research and development through purchasing,
production, and sales and after sales services they have already been improving their corporate
social responsibility execution. For the next years it is likely that they will keep on improving
and focusing on their CSR management to enhance their brand image.
LG will continue to focus on building strong partnerships with stakeholders as mentioned
before, since that has been working to grow their brand image and brand awareness. This will
help grow a sense of brand loyalty, which is a major threat whenever a company is able to
generate strong brand loyalty in an industry as saturated as consumer electronics.
It is also likely that they will keep on implementing their customer-value creation and
people-oriented management. These are basic management philosophies that insure that they will
accomplish their business activity goals, as mentioned before.

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These successful management strategies pose a major threat to Sharp, as they are
generating a strong base of loyal consumers and employees, and a wider net of brand recognition
coupled with a good brand image. These threats attributed to LG’s brand name combined with
the facts that they have a strong Research & Development department constantly innovating in
the industry, and they are consistently pulling out strong profits makes it likely LG will make an
attempt to innovate a new market segment by innovating an existing technology that they have,
as they have done most recently with TV’s. A likely product they might develop is a portable Air
Conditioning Unit, that is light weight and collapses into an easy to carry way, but at the same
time is powerful enough to easily cool down an average sized room. They would create this with
the technology they’ve worked on in the Air Conditioning market segment for several decades,
and leading it from 2000-2007, as discussed earlier in their historical analysis section.
Competitor #2 - Panasonic Corporation
Note: All information in this section is deducted from information in previous sections.
It is likely Panasonic will continue to restructure their business to make a stronger
consumer electronics company over the next three years, as they have recently began doing since
hiring new management in June of 2012 as mentioned earlier in the competitor’s management
section of this report. Then at their fiscal year end date, March 2013, they announced their new
plan to eliminate unprofitable businesses, cut costs, and restructure their marketing. This is a
appears to be a shift in strategy from differentiation to best-cost as they are working on cutting
costs in their value chain, and eliminating products that had run their product life cycle and are
now dogs; otherwise known as products with a low market share, and showing low market
growth. In addition to the cost cutting, their restructuring of their marketing is focusing more on
the diversity of their portfolio.

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A shift in strategy has company-wide effects. This has strong chances of saving the
company as they are just coming off a year in which they earned a negative ten percent profit
margin. Panasonic needs to identify which products are not selling well, and in which the market
growth for that product is minimal. This negative profit margin is largely attributed to high costs
as they were making enough revenue to exceed their total assets as evidenced by their asset
turnover discussed earlier in the report.
These factors point to a need to cut costs. Now that they are outsourcing research and
development, and manufacturing in order to reduce fixed costs, and direct costs. Along with a
restructured marketing division and the cutting of dog products Panasonic should see an extreme
drop in costs, therefore a strong increase in profit within the next three years. This is going to
give Panasonic a stronger financial position, with more money to Research and Develop new
products, and market their stance in the Consumer Electronics market overall will strengthen,
increasing their threat of either taking over an existing market, or innovating a new market
before Sharp. However, Panasonic is not in a strong position to do this before Sharp, as it will
take several years for Panasonic to recover from the debt they have incurred by consistently
reaching a net loss as discussed in their financial section.
Panasonic does not have the cash reserves to continue sustaining a ten percent net loss.
Therefore, if they do not correctly identify the costs that can be cut and cut them, they will be
driven to file for bankruptcy within the next three years.
Panasonic has successfully marketed their solar technology, and is well known amongst
businesses for their solar technology. It is likely this will be a major part of their strategy moving
forward in which their Research and Development team will attempt to find a way to reduce the
high costs attributed to installing alternate energy. This poses one of the largest threats to Sharp.

182 | S h a r p
If Panasonic identifies a way to cut costs on solar technology the market will boom fast, and
Panasonic will have the first mover advantage, and possibly a patent on the technology to cut
costs. It was identified earlier that the factor holding back the alternative energy market from
booming is the high costs that come with the initial installation of alternative energy.
Panasonic innovating this market segment and developing a patent on how they are able
to cut costs with solar technology could completely shut Sharp’s Energy Solutions down unless
Sharp is able to differentiate from Panasonic by offering higher quality alternative energy. This
type of technology is not expected until oil begins to run dry, but Panasonic has the ability to
speed up the process with their current knowledge in the solar technology field and their strong
research and development department known for constantly creating new products for the
consumer electronics industry.
This strategy is an offensive strategy that would put Panasonic out in front of competitors
when they innovate a part of the market before their competitors and earn a first mover
advantage.
Competitor #3 - Samsung Electronics
*Note: All information in this section is taken from information in previous sections.
It is likely that Samsung Electronics will continue to build on to and improve on the
successful company that they have already produced over the next three years. Samsung has
become one of the financial market leaders in the consumer electronics industry. Over the past
three fiscal years, and dating back further than that, the company has had continued growth in
their net sales. Their net income has also increased with every passing year. As a company,
Samsung has a strong current ratio which means that they can cover their current liabilities with
their current ratios. Compared to the industry average, they are exceeding expectations. Samsung

183 | S h a r p
also has a very strong acid-test ratio which means that even taking their inventories out, they are
able to pay their current liabilities with their current assets. Further, the company’s debt ratios
including debt to equity and debt to assets ratios are very low when compared to competitors
across the industry. This is beneficial to Samsung because this shows that Samsung’s creditors,
lenders, and suppliers do not have as much invested in the company as shareholders do or that
assets cover. The company’s profit margin ratio is also secure when compared to others in the
industry which means that as a company Samsung has good control of its costs. All of these
ratios have been positive and continuously growing from fiscal year 2011 to fiscal year 2013.
This provides some evidence that the company will continue to be a market leader with its
growth.
Since Samsung Electronics is a market leader and has such a strong hold on their
financials, the company has the ability to be flexible with some of their spending and costs.
Samsung recently made an acquisition of Smart Things which will only benefit their company
from the sounds of it. Sharp has the option to spend some of their funds on marketing strategies
which can help some of their campaigns that they have going. Over the next three years,
management will probably spend money on making sure the Smart Things acquisition is
properly integrated into all aspects of the company. This means that it will be heavily marketed
and all the right markets will need to be targeted. Therefore, there will be a significant amount of
time, money, and strategy just being placed into this acquisition. With everything that Samsung
Electronics has gotten into just within the past decade, a significant amount of money will be
spent on attacking competitors with ads and campaigns to let consumers know that Samsung’s
products are the best the market / industry has to offer.

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As mentioned before Samsung will probably keep with their two different pricing
strategies as it has been working well for them. With their skimming price, charging higher than
heir competitors since they have a sustainable competitive advantage over their competitors.
With their competitive pricing strategy, basing their products prices with their competitors’
prices is a good thing since a lot of their products they sell their competitors have similar
products so they will have to keep with this strategy in order to have advantage since they are
one of the biggest and most recognized brands in the industry. Samsung during the next three
years will have to keep their pricing strategies in order for them to keep having the competitive
advantage over their competitors.
With their promotions, they will probably keep doing the same with their advertising, as
mentioned before mainly with their special offers and discounts and the company’s pull strategy.
Samsung uses their advertising to pull their customers to their products but also push the product
to the customers through sales and promotions. They will probably keep giving special offers
and discounts to its trade partners to motivate and influence them to sell Samsung products over
their competitors. During the next three years they will probably keep up with these promotions
since they have been working for them, giving them a big market share.
Over the next three years, costs will probably be cut throughout the supply chain of
Samsung Electronics due to everything that has been done within the past couple of years in the
company. There is no need to have everything in the supply chain, so costs can be eliminated and
focused somewhere else where they would be more beneficial in the company. One area where
costs and money will probably be focused towards is research and development. Samsung
Electronics is always looking for new and innovative ideas, so management is going fund ways
to get those ideas first before their key competitors.

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Competitor #4 - Sony Corporation
It is likely Sony is going to begin focusing on their movie and music studios over the next
three years more than their consumer electronics side of business as that has been their most
profitable area in recent years. Sony’s CEO Hirai believes upcoming Spider-Man movies and
other movies based on PlayStation video games will increase revenue by 36% over the next three
years.(1) This has been a major source of revenue for Sony recently with the past two Amazing
Spider-Man movies each grossing over $700 Million at the Box Office.(1) At least one spinoff,
the Sinister Six, is being planned along with others being rumored such as a female Spider-Man
spinoff, and even an origin story for Spider-Man’s Aunt May in which she is a spy somewhere in
the 50’s-70’s.(2) In addition they are betting big on their upcoming movies based off of the video
games Uncharted, Assassin’s Creed, God of War, Sly Cooper, Ratchet and Clank, and the Last of
Us.(3) These are all in varying degrees of development, with some coming out in less than a
year, some have been in development for years, and some have just been announced. Sony is the
only console manufacturer to have a film business. The record of success has been minimal with
video game to movie adaptations, but with the recent trend of video games being created with a
more cinematic approach, there is a strong likelihood of success for future video game
adaptations, which is what Sony is openly hoping for. Before getting in too deep with turning
games into movies, Sony should pick the most popular game available and the game that they
will bring the most revenue. Using this as an experimental test run to see how id this market is
worth the time and money of getting into. If the movie does well proceed with making more
games into moves, if the movies fails drop the idea and go back to the drawing board to find
another area to increase revenues. In addition, entering into this industry can be pretty difficult
when considering one of their biggest competitors is going to be Disney.

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Sony has managed to create a large portion of its revenue from its exclusive deal with the
band One Direction for concerts, and music discussed earlier. Sony took on a significant amount
of loss in 2011 and 2012. In 2013 Sony was finally able to generate a profit after the first
Amazing Spider Man movie. Sony’s management has plans for revitalizing their consumer
electronics business, but is going to focus on the successful movie and music parts of their
business first to create a stronger company as they currently have a low asset turnover. This is
part of their plan for creating a foundation for revitalizing their Consumer Electronics business.
To help generate more revenue Sony should make more exclusive deals with popular artists since
the deal with the band One Direction went so well for them. By teaming up with popular artists
through exclusive deals could open a very good window for the company promotional wise and
research and development wise. Promotional wise because the company can use these popular
artists as spokespersons for their products and say that the celebrity actually uses the product.
Also, Sony could have their logo put up around the events centers where the concerts are taking
place in easily visible areas for fans to see. Popular people that are in the public eye often is a
great way to market products. People will literally buy products just because that one particular
person is using that product. If this person is very popular with the public then this could mean
outstanding revenues for the company endorsing the person wearing their products. And through
research and development Sony could experiment new innovated products on the artists and see
how they like the product and ask for feedback on the product and if they would make any
changes.
Sony has recently put a lot of money into research and development for medical
equipment. This is a market that Sharp is also focusing on as an area for major future
development, but the growth is far away. Entering this market could be a great opportunity for

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Sony and could end up being very beneficial in the long run. There will always be a demand for
medical equipment in around the globe. If Sony can produce state-of-the-art medical equipment
with today’s advanced technologies that can compete with the already existing marketing, then
Sony will have a very good chance at becoming one of the top companies in this industry. To
even better their product the company should think of adding features to their products that will
differentiate them from their competitors and give them a competitive advantage. A good way to
promote thee product would be to donate their newest medical equipment to some the top
medical institutions in world and have then institution give them feedback on their products. This
feed could include things such as: did they or did they not like the product, was the equipment
useful and relative to the procedures they practice, and are there any feature that should be added
to the product. Also, by donating this medical equipment to these institutions will create positive
feedback for Sony and will catch the attention of the public and other institutions. By gaining
this attention should make consumers more interested in their products and will most likely
increase the sales of the product. Also, to start with a positive image can go a long ways, if
company has well known positive reputation the better their chances are to attract customers.
Sony is dissatisfied with the speed of their decision-making and the execution of these
decisions and has plans to improve. This could create a quick shift in strategy in the future that
could pose a threat to Sharp. Unless a major shift in strategy does happen for Sony, they will not
pose as much of a direct threat in the next three years. Once they create a more financially strong
situation, they will pose more of a direct threat to Sharp. However, that threat is likely more than
three years away, as their focus is shifting away from consumer electronics for the next three
years.

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2. Identification of Competitive 3-Year Strategy for Sharp Corporation
A. Discussion of Which Generic Competitive Strategy is the Best Fit for the Next 3 Years
The competitive strategy of a company is important to the overall success of a company.
A company’s strategy deals with management’s plans that they have for competing against key
competitors. As discussed in class, there are five different strategies that companies can choose
from to pursue to help with the success of a company. The five different types of strategies
include a low-cost provider strategy, a broad differentiation strategy, a focused low-cost strategy,
a focused differentiation strategy, and a best-cost provider strategy. Each strategy provides a
different advantage that could be beneficial to a company depending on what they are looking
for based on their plans for the future. After carefully reviewing and discussing the various types
of strategies that are available for companies to pursue and use, it would be in Sharp
Corporation’s best interest to strengthen and improve on the best cost provider strategy that they
currently have in place over the next three years. A best-cost provider strategy is a hybrid of
strategies and offers customers more value for their money while still satisfying buyer’s
expectations on quality, features, performance, and service attributes and still beating some price
expectations. This competitive strategy fits what Sharp is best set up to do for over the course of
the next three years.
In part two of the current analysis, Sharp Corporation’s current strategy was discussed.
Their current strategy that the company has been implementing over the course of its business
has been a best-cost provider strategy. The last few fiscal years have been a struggle for Sharp
Corporation, however we believe that with their most recent fiscal year financials the company
will be able to strengthen their best-cost provider strategy which will strengthen them as a

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company overall and give them the advantage they need to continue to operate in the consumer
In fiscal year 2012, the company had a current ratio of 0.73, a debt to equity ratio of
1448%, a debt to assets ratio of 93.54%, an asset turnover ratio of 1.05, and a profit margin of
negative 22.00%. These financials for the fiscal year 2012 were the result of a plant shutting
down temporarily, which caused a halt on the production of LCDs, one of Sharp’s largest
product lines. This was discussed earlier in the paper. The fiscal year 2012 was the second year
that the company sustained a net loss. After the second year of net losses was recorded,
management went through a change with a new board being implemented. The new board
decided that in order to get Sharp Corporation to stop producing net losses, changes needed to be
implemented across the company. Those changes were going to start with management.
Top-level management deemed fiscal years 2014 and 2015 as the “regrowth stage” for
the company. After the changes that were implemented, Sharp Corporation seems as though they
are on their way to figuring out what it takes to get back on the right track. For fiscal year 2013,
all of their ratios improved from the previous year’s results. When compared across the
consumer electronics industry, as discussed in Section 2, Sharp Corporation fared relatively well
and matched the industry average for many of their ratios for fiscal 2013. For fiscal year 2013,
the company made it a point to improve their sales. In order to do this they realized that they
needed to make some changes to their products. They updated their Quattron Pro televisions with
HD capabilities to modernize them and also equipped their smartphones with their latest LCD
technology. Sharp also placed their latest LCD technology in their solar cells and small and
medium sized LCDs. By updating their best selling products with enhanced features and up-to-
date technology, Sharp was able to improve their sales for fiscal 2013. This is turn helped their

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cost of goods sold ratio improve and gave them a high gross profit to work with. In the end, the
company was able to pull out a net profit for the year.
By working off of the most recent fiscal year’s success, Sharp Corporation can continue
this best-cost provider strategy into the next three years, which they have deemed their “regrowth
stage”. Over the next three years the company could work on implementing and changing a
variety of things that would help to improve their business model and strengthen their position in
the consumer electronics industry. The company can start with improving their overall business
foundation. This can start with the financial aspect and then work its way out from there. Sharp
should concentrate on reducing its inventory. We performed an inventory turnover ratio analysis
in Section 2, and the results were good. The company is turning their inventory over at a decent
rate every year. This simply means that they are not holding onto their inventory for long periods
of time and storing it in their warehouses. However, there is room for improvement. When
compared to other companies of their size, Sharp can work to improve on this ratio so that their
inventory numbers are not as high as they are. As a company, Sharp also needs to work on
reducing and restricting the amount they are investing in capital expenditures every year. These
investments are driving the values up on the balance sheet, and it is extra investments that Sharp
cannot afford to have right now during the regrowth period. It was discussed in section 2 that
Sharp’s cost of goods sold is consistently high when compared to their net sales that they are
bringing in every year. The high costs are bringing gross profit down to the point where the
company has a minimal amount left to pay expenses. Over the next three years the company
should focus on making radical cuts in their overall costs. This could be in the form of cutting
jobs or even cutting back on what they are spending money on in the way of production in their
plants.

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Sharp should continue to focus on producing products with their latest technology. This
means that they should continue investing in research and development because if Sharp falls
behind on the latest trends, then they will not be able to keep up with the industry. The company
should invest time and money into figuring out what the next step or use for the LCDs could be.
LCDs are their largest selling product and they have incorporated them into a majority of their
products. By doing this, it gives Sharp an edge because their LCDs are high tech and innovative.
By finding a new venture to utilize their LCDs in, Sharp could be looking at possible success.
The company could work to find products of their own that could utilize LCDs and build off of
that, or they could find other companies with products that lack LCDs and need them to enhance
their products. This would form a potential partnership and could be beneficial for both Sharp
and the other company.
Sharp should also look into the energy solutions sector of their business model. Not many
consumer electronics companies specialize in energy solutions and Sharp has created products
throughout the years that have peaked an interest in energy solutions. Throughout their history,
Sharp Corporation has changed different aspects of their company to become eco-friendly and
environmentally safe. As discussed in section 1, they implemented their 3G, 1R strategy of
Green Mind, Green Factory, Green Product, and Recycle to have everyone in the company focus
more on the environment and being green. A majority of their factories were changed to green
factories and everything that could be recycled, was. Many products that were produced became
green and eco-friendly. Sharp even created some of their own innovative systems to help with
green technology, which included their own purification system that they placed in a variety of
their air purifiers and home appliances over the years. When LCDs became their big focus,
energy solutions went to the side even though they maintained their 3G, 1R plan. Sharp should

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work to renew their energy solutions business over the next three years because it would make
them a market leader and would give them a competitive advantage in the industry. Sharp could
develop new products and systems that incorporate some of their innovative technology of today
to utilize energy systems. This could potentially create a whole new line of products for the
company and in the industry, which would definitely give Sharp a competitive advantage above
its key competitors in the consumer electronics industry.
If Sharp Corporation focuses on continuing to improve its financials by lowering its costs
of goods sold and inventory, and restricting specific investments that they make each fiscal year,
then the company will continue to produce a net income from year to year provided that they
increase their net sales as well. By investing money in research and development to better
improve on current products and create new ones, Sharp’s customers will be getting more value
for their money and Sharp will be getting the expectations of quality, performance, and service in
their different products. By restructuring the way that their cost of goods sold is and cutting back
on different cost the company is using, Sharp could beat some price expectations that other
companies in the industry cannot. By doing all of this over the next three years, Sharp will be
able to continue to implement, improve, and strengthen on its best-cost provider strategy that it
currently has in place, giving Sharp Corporation an edge in the consumer electronics industry.
B. Identification of Offensive Strategies to Exploit Against Competitors and Which
Competitors You Will Use Them On
Sharp’s offensive strategies should be widespread. They need to begin with a focus on
research and development to draw sales and market shares away from less innovative rivals;
specifically attacking competitive weaknesses of rivals. Samsung is the biggest competitor and
poses the biggest threat in all their market segments. They’ve succeeded in differentiating as the

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other option to Apple in the smartphone market. They are also the leaders in the LCD TV market
that Sharp once lead. Sony is taking their focus off of the Consumer Electronics division
exposing a weakness in the console market that they share with Microsoft. Panasonic and LG
have shifting strategies and are financially weak. Panasonic relies on their TV and cameras as
well as their solar panel business, while LG is reliant on their TV and Phone products.
These strategies also include leapfrogging competitors by being first to market with new
technology, by deliberately attacking market segments where Samsung and Panasonic make big
profits. In order to do this they will need to adopt GoPro’s technology through the partnership
they need to develop.
The proposed strategy begins with the partnerships discussed previously in the
supplemental strategies section. Sharp’s Research and Development must begin by creating an
all-in-one TV and game console with a camera built in. This product should utilize the special
GoPro motion camera technology to track the user much like the Xbox Kinect except built into
the TV. In addition, the LCD technology Sharp has spent decades researching will help to
shorten the time it takes to integrate this new technology into their current TVs. This product
adapts GoPro’s technology and takes advantage of Sony taking their focus off the console market
by creating a gaming console that is a part of their TV, working as an all-in-one TV and console.
This will specifically take away from Sony’s console market share, and all competitors market
shares in the LCD TV market, especially the market leader, Samsung.
Part of the research and development process must involve identifying if it is possible to
integrate PlayStation and Xbox games into their new console both legally and logistically. If it is
not possible then Sharp must begin approaching current game makers to start producing their
games in Sharp’s console format. They should start with major industry leading games that come

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out when the console comes out, such as Call of Duty, Madden, and whatever the big release is
at the time.
In addition to the new TV product, the marketing campaign for Sharp’s Energy Solutions
is a direct attack on Panasonic’s current market leading abilities discussed earlier in this paper.
Sharp must provide a complete energy upgrade to their second partnership at cost, and then use
the marketing campaign they generate together to make Sharp’s Energy Solution business well
known as the alternative energy provider.
In addition to the marketing for their Energy Solutions business, Sharp will announce the
new TV-Console product at the biggest gaming convention, the E3 convention, where all the
biggest new gaming technology is announced every year, and then launch a full marketing blitz
campaign to get the word out about their new product. These should be in quick succession to
surprise Sony.

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C. Identification of Defensive Strategies to Protect Competitive Advantage from Other
Industry Participants and Which Participants You Should Implement Them For
The plan for defensive strategies is to revolve around forced obsolescence. This would
not be a strategy made public, but the general idea is to have a shortened product lifespan for
their TV-Console. Where PlayStation and Xbox have continued increasing life-spans, Sharp
should introduce an updated version of their TV-Console once every two to three years. This will
defend against competitors taking too much of the spotlight off of Sharp’s console. It will be
imperative that Sharp not anger their consumers by making their old discs obsolete, just the TV-
Console product itself. This can be done by keeping the same disc working for each Console, but
with improved features with each new model. The new product will be announced in a press
release to combat anybody trying to copy the idea.
In addition, Sharp will expand their LCD TV product line to new unique sizes. These
unique sizes will be offered with the all-in-one TV-Console as well in order to prevent
competitors from trying to attack the new product as having a lack in variation of size. The new
product must target both the gamers from the game console market. At the same time Sharp will
need to market to non-gamers so that those just looking for LCD TVs will find advantages to
having the motion camera built into their TV to help with tasks while watching TV such as
changing the channel, volume, input, and other various TV tasks with motion detected by the
GoPro camera technology.

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D. Discussion of General Timeline to Implement Offensive and/or Defensive Strategies in
Next 3 Years
Year One:
Year Two:
Year Three:
E. Discussion on Other Potential Supplemental Strategies
Other potential supplemental strategy that Sharp should engage is a strategic alliance. A
strategic alliance is an agreement between two or more separate companies in which there is
1. Create partnership with Go Pro
2. Create partnership with company that uses a lot of Energy for Energy Solutions
Business
3. Shift recent profits and marketing funds to research and development
4. Begin Research and Development on new TV-Console project
5. Have Legal Team Identify Legality of integrating Xbox and PlayStation discs
into new Console
6. Begin construction of energy saving technology for new partner and finish by
the end of the year.
7. Announce the new product at the E3 convention
8. Finish Research and Development of the new product half way through the year
9. Begin shifting funds from Research and Development back to Marketing
10. Begin early stages of marketing campaign for new product.
11. Drop Research and Development funds and shift them to Marketing
12. Begin marketing campaign with partner on Sharp’s Energy Solutions
13. Create a major marketing campaign to run for the three to four months before
the TV-Console release
14. Release the new TV-Console in the beginning of Sharp’s fourth quarter
15. Begin research and development on the next generation TV-Console to be
released in the next two to three years

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strategically relevant collaboration of some sort, joint contribution of resources, shared risks,
shared control and mutual dependence.
The first partnership we came up with is with GoPro, that is an American corporation that
develops and manufactures high definition personal cameras, often used in extreme action video
photography. GoPro sales have more than doubled every year since the first camera’s debut in
2004 (1). In 2012 the company sold 2.3 million cameras and grossed $521 million (1). For the
month of December in 2013 GoPro was the highest-grossing digital imaging brand at Best Buy
knocking out Sony for the first time in the chain’s history (1). With this partnership both
corporations would benefit from each other. With this partnership both companies will have
technological improvements. For GoPro we would introduce to them Sharp’s LCD technology,
so they can add them to their cameras and other products. As for Sharp, GoPro would help them
in the camera department, for example Sharp could incorporate a webcam with the GoPro
technology into their televisions. GoPro would benefit from Sharps expertise in technology,
since Sharp is a company that has been in the consumer electronics industry for more years than
GoPro. They would specially benefit from their LCD technology which is what Sharp has the
most expertise on and have one of the best quality LCD technologies available. Sharp would be
the only company with a partnership with GoPro. Partnering Sharp and GoPro would bring
many benefits to both of them; it will only improve each company’s technology for the better.
We came up with another partnership idea for Sharp; they need to find a company who is
heavily reliant on energy such as Google. The idea is to replace what the company does with
their energy and use Sharp Energy Solution products, such as their geo thermal energy, wind
energy, and solar cells. The idea is that Google would create an ad campaign and get Sharp
Energy Solutions out to the media. Google would fund the campaign and we will give them a

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discount with our products to replace all the energy they use. The ad campaign has to be a big
campaign in order for Sharp Energy Solutions to get known around the world and so they can
improve in their sales. With this partnership both companies will benefit from each other, Sharp
having Google use all of their products to replace their energy and they will fund an ad campaign
and bring that sector of the company out to consumers. Google will benefit with Sharp since they
will be replacing their energy with Sharp’s products in order to save energy in the future, making
it a good investment for Google. Both of the ideas we came up for partnerships will benefit every
company involved and will make Sharp grow as a company and get more consumers involved
with their products.
3. Identification of Relevant Issues Concerning International Markets and / or
International Suppliers
Sharp Corporation is an international company that employs a global strategy. This is a
think global, act global mentality where the company utilizes the same strategy worldwide no
matter where they are operating in the world. Sharp’s management had to decide if the different
segments that they were marketing to had local variation or not. This meant that the company
had to decide if their products would have to be altered to tailor each market they were targeting
or if they could just use the same product universally. After researching their different markets,
Sharp decided that their products did not have to be manufactured to fit each market.
Management decided that a product could be the same worldwide and there would not be an
issue. Sharp Corporation treats the world essentially as one market and one source of supply with
very little, if any, local variation (4). The company’s competitive advantage is developed largely
on a global basis, versus locally (4).

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In 2006, consumer electronics companies had to provide documentation that showed their
equipment complied with the European Union's Restriction on Hazardous Substances law which
restricts the use of lead, cadmium, mercury and three other substances in electronics equipment
(5). If companies did not comply with this law, they were assessed fines and sometimes not
permitted to sell products in European countries. This issue has come up again in 2014, except
with companies that have operations in the United States of America (5). Starting in 2014,
electronics companies that operate in the United States will have to show that they are complying
with the mineral regulations under the 2012 Dodd Frank Wall Street Reform and Consumer
Protection Act (5). This law requires companies to disclose of products that contain any form of
tantalum, tungsten, tin, or gold that was mined in the Democratic Republic of the Congo or other
countries in Africa (5). The reason for this is because rebels in the Democratic Republic of the
Congo have used proceeds from conflict minerals illicitly mined in order to fund their various
war efforts (5).
By making it so that Sharp Corporation has to comply with both of these laws,
international issues arise because Sharp has to make sure that they are disclosing everything on
an international level that meets other countries’ standards. For examples, Sharp has to make
sure that everything complies with the Securities and Exchange Commission when reporting for
the United States laws. This can create issues across the markets because there are differences
between the two markets and if one reports something that does not mean that the other
necessarily reports it.
Everyday imports and exports can cause issues across international markets and
international suppliers. This is with any consumer electronics company that operates on an
international basis. Sharp Corporation will have issues with international markets concerning

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their imports and exports because regulations are always changing regarding imports and
exports. When regulations change, the imports and exports of companies also change because
companies always need to comply with regulations. International standards are different across
countries so when countries change their regulations, it requires that all countries comply to
make sure imports and exports are legal. Taxes and tariffs are also changing constantly across
international markets; therefore Sharp has to comply with the different currencies of the different
markets that they operate in. This can cause monetary differences between countries, which can
become an issue for finance purposes.
Since Sharp Corporation utilizes an international global strategy, where they produce the
same product worldwide no matter what market they are in, the company has to deal with
potential issues that arise with international markets and suppliers. These issues include
complying with regulatory laws that get passed in other countries, imports and exports, and
changing taxes. With all of these changing constantly, Sharp Corporation has to be ready for
international issues that could surface at any time.
4. Brief Discussion of Functional Policy to Accommodate Strategic Plan
A. Discussion of Strategic Policy Relative to Finance / Accounting
Over the course of the past three years, Sharp Corporation has shown different results on
their net income statement. For fiscal years 2011 and 2012, the company recorded significant net
losses that amount to billions of yens in losses for the company. For fiscal year 2011, the
company sustained a 376 billion yen net loss, while in fiscal year 2012 the net loss was even
more substantial totaling to a 545 billion yen net loss. However, even after sustaining those two
significant losses in back to back years, the company was able to overcome that and achieve a
net income of 11 billion yen for fiscal year 2013. This significant change in direction had to do

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with a change management after 2012, as well as a new direction for the company, which was
discussed in previous sections. Overall, changing the products of the company and enhancing
products with LCDs and HD capabilities boosted net sales, which in turn gave the company what
it needed to produce a net income for 2013.
As a result of the most recent financial statements and fiscal year results, we have
decided that the company should maintain a similar financial path / approach for their company
with a few changes. Sharp Corporation should continue to update their products with the latest
technology because this increases sales, which the company needs. Sharp needs to focus on
retaining more cash and cash equivalents. The balance is this account has decreased steadily
every year for the past three fiscal years. By doing this, the current asset amount decreases
meaning there is less liquid assets to pay off debts in case something were to happen. The
company should work on continuing to decease their inventories. By doing so, this means that
the company has a better inventory turnover rate and that there is less product sitting in their
warehouses. Also, in general the company should decrease their inventory supply because the
more they produce and manufacture the more it costs, which is driving up their costs of goods
sold and then driving down their gross profit. The company’s machinery, equipment, vehicles,
and other account has been slowly decreasing over the past couple fiscal years. This is good for
the company because that means there is less money wrapped up what they are investing in their
property, plant, and equipment. The company should continue to lower this cost because it will
help bring down costs on what they are spending to run the machines, vehicles, equipment, and
any other fees associated with them.
Two liabilities accounts that Sharp really needs to focus on decreasing over the next three
years are their short-term borrowings account and their long-term borrowings account. These

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two accounts alone caused the debt to equity and debt to assets ratios to be as high as they are.
The creditors and lenders of Sharp have invested more in the company than anyone else which is
evident by these two accounts alone. By focusing on bringing these two accounts down over the
next three fiscal years, then the company will be able to draw back more investors which have
dropped off significantly and will also improve their ratios in the company overall. Sharp
Corporation should also focus on bringing down their trade payables and accrued expenses
accounts. These two liabilities accounts are also relatively high and are causing significant debt
for the company. By focusing on paying these debts off in the next three years and keeping the
balances down, Sharp will be able to focus on new investments and will not have to worry about
paying old ones off.
Overall, Sharp Corporation should focus on increasing their sales over the next three-year
period, which will include enhancing their products so that they can continue to sell them at high
volumes. The company should work on lowering their cost of goods sold so that their gross sales
/ gross profit remains high enough from year to year to pay off debts and expenses they owe.
Lastly, Sharp should work towards maintaining a net income because if they do not, they will not
be able to compete in the consumer electronics industry against their key competitors.
Sharp should make it a point to invest money in research and development over the next
three years because they need keep up with the industry and changing trends. The consumer
electronics industry is competitive and Sharp’s competitors are all working to develop innovative
products. Sharp should incorporate their innovative technology, LCDs, and energy solutions
lines to achieve something that the industry has never seen before. In order to do this, the
company needs to invest the money in it. Over the next three years, we believe that this should
be done because we the benefit to Sharp will be huge in the end if they find it to be successful.

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The current financial and accounting policy of Sharp Corporation works well for the
company, and does not need to be changed significantly. If the company incorporates a few
changes over the next three years to the policy then Sharp will have the edge in the consumer
electronics industry and will have stronger financial statements to prove their position.
B. Discussion of Strategic Policy Relative to Marketing Strategy
In the next three years Sharp Corporation’s marketing division will be put on a very slim
marketing budget. For the first year the marketing division will suffer a loss in budget while the
research and development will receive a bump in funds. This should occur so the company can
develop new products with more advanced technologies and better features to better attract
consumers to their products. By giving research and development a boost in their funds should in
return help the company produce these better more appealing products. The second year
marketing will almost be non-existent so research and development may put a full on push to
produce more products with advanced technologies and produce more products for the marketing
division the following year. In the third year the marketing department’s budget will increase by
150% and will put on a full marketing blitz to market all the new products and new technologies
that the research and development team had developed over the past 2 years.
Also in the next three years LG Electronics and Panasonic Corporation are planning on
moving to a best-cost (value strategy). A best-cost strategy is a company that wants to provide
their consumers with a low-cost product, bet yet satisfying their consumers through the quality,
features, performance and service of their products. Both of these companies are moving from
broad differentiation strategy, which Sharp is moving in the direction of. Broad differentiation
strategy is when a company offering something unique to their products, which, differentiates
them from their competitors, but at the same time, is appealing to wide range of consumers.

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Sharp Corporation will be able to do this through some very key partnerships; the most
important partnership being with GoPro. Go pro is looking to add a LCD screens to their
cameras, and who better than to design and produce those screens than Sharp. On the other side
Sharp is in the market for a camera company to design and produce a camera they can be
mounted directly on their TVs. GoPro makes some of the best compact cameras available on the
market and their product would be exactly what sharp is looking for. The deal would work for
both companies, Sharp uses GoPro’s technology to improve the quality of the camera and GoPro
uses Sharp’s technology to better their screens for their cameras.
For the third year the plan is to bring a new to product every year, by forcing the products
to have newer and better technologies available for consumers. One of these new products will
be a highly technologically advanced TV. The announcement of the TV will be brought to the
public eye in the second year at E3 convention in June. And the final product will be released at
the end of the third year. As mentioned previously, Sharp is looking to team up with GoPro to
develop a camera to be mounted on a TV; that is exactly what this TV will offer and so much
more. The Camera itself will be a huge selling point for the TV. The camera will be equipped
with motion sensors to follow the person around the room up to a certain distance and will also
have the capability to take pictures. The main use for the camera is to be used as a webcam
through networks such as Skype. Now instead of the consumer sitting in front of their computer
to use the webcam all they have to is turn on their TV. But in order for all this the to happen the
TV will come with WiFi availability to connect to the consumer’s internet. The idea of mounting
a camera to the TV is to take market shares away from Sony who is losing focus on the
consumer electronic side of business. Also to attack the Sony even more Sharp will develop a
gaming console or partner with another gaming company (not Sony) and will have that gaming

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console built into the actual TV itself. This will also give sharp a huge advantage over Samsung.
By being the first company to incorporate the newest features into our TVs, Sharp will be able to
surpass Samsung in the market share holdings for consumer electronics in relation to TVs.
To promote this state-of-the-art TV, Sharp will attend gaming festivals such as the E3
convention (one of the largest gaming conventions in the world) where the initial announcement
of the product will be made. The following year the physical product will be revealed at this
same convention. For the new product the company will set up a booth where visitors can come
and play their favorite games on the new TV. The consumers will be able to test out all the
features of the TV at this event and will hopefully persuade the consumers to go and buy the new
product. In this gaming promotion Sharp could partner with a popular game such as Call of Duty
and release the two products around the same time. Or Sharp could just use the game as
promotional deal where if you buy the new sharp TV the consumer gets a free copy of a
particular popular game. By doing this sharp would use a bundling strategy by grouping two
products together. The promotional campaign will travel to popular events globally involving
new technologies to expose the company’s new product. Another promotion Sharp could run is
to have this new TV the center of attention in retail stores they distribute to. Have the display set
up with couches around the TV so that the TV is the center of attention along with a movie
playing and furniture to give the customer a feeling as if they were sitting in their own home.
And for the gamers, have a display set up where the customers can play the newest most popular
games to play on Sharp’s newest top-of-the-line TV. Another big promotion that will be ran for
the TV is commercials and advertisements. To start out theses advertisements will be minimal
due to budget restraints, but during the year these advertisements will be largely increased to
broaden consumer awareness of the new product.

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As to where Sharp should continue placing their products in the market should be the
ASEAN region. As said earlier in the paper the ASEAN region is the region expected to grow
the most in the demand for consumer electronics for years to come. So sharp should be the first
company in these nations distributing their products to gain brand name customers, become a
commonly known name, gain a competitive advantage, and gain loyal customers who will keep
buying their brand named products in the future. The ASEAN region will be the main focus for
the company when researching and developing new products since this region will have the
highest demand for the products Sharp is offering. Since Sharp has already begun building the
largest manufacturing plant in this region (Indonesia), so mass-producing products to keep up
with the demand of products in this region should not be a problem for the company. Also, since
the company now has this manufacturing plant here the company is already a step ahead of its
competitors in this region.
For promotions in the ASEAN region Sharp will begin developing advertisements to be
aired on TV to promote campaigns, sales, new products, and special offers. Since the demand for
consumer electronics in the ASEAN region is increasing, more consumers here will have the
opportunities to now see these advertisements. Sharp will also keep its existing promotion of the
dance to the festival promotions. This is where people dress up in certain outfits and dance and
sing to whatever festival is being played on Sharp Television. This promotion is based on
festivals that take place in the local cultures and can be directly related to the people of this area
very easily. The promotion works well because it directly relates to people and attracts large
amounts of people to the area where the display is happening, which draws positive attention to
the company’s name and attracts possible new customers

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As for the solar energy division of the company, to be successful it will most likely have
to partner with another company. This company will have to be larger and better known around
the world. Most likely the larger company will purchase the majority of Sharps solar energy
division, Sharp will have some stake in the business, but the larger company will have majority
of the interest. By joining with a larger company the two can combine funds and do more
promotional campaigns to get their products and name recognized around the world. By doing
this the two companies could run a promotion informing consumers how important it is use
environmentally friendly energies and make them more aware of how the energy sources we are
using today are damaging the environment. For example Sharp could partner with Google to
make their name more recognized around the world in the eco-friendly industry. Google would
run and pay for the ad campaign and return Sharp would make Google’s building more
economically friendly at a discounted price. Sharp alone associating their name with Google will
in return strengthen their brand name and make it more well known name to the public.
C. Discussion of Strategic Policy Relative to Management Strategy
Sharp’s strategic plan needs a couple of things in order to make the company more
successful through the years. With their management team they will start increasing efficiency
and continue working for the company’s goals. As mentioned before they implemented a
Medium Term Management Plan in which they used 2013 as a restructuring stage and 2014 and
2015 was for the re-growth state.
For them to accomplish their target they came up with three strategies as mentioned
before which are to shift to advantageous market and fields, exit closed innovation and
aggressively use alliances, and enforce executions by innovating governance system. They will
accomplish all of these by restructuring their business portfolio, choosing which products are the

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best ones for the company, which of all the products bring them profit or will bring in the future.
They also are improving profitability in their LCD business which is big for them, since they are
one of the best company’s in the LCD business, so they are going to keep promoting and selling
their LCD’s. They will increase profitability especially since they have dedicated one entire plant
to the production of their LCD screens for Apple. As mentioned before they are going to invest
about 35 million yens in the current LCD business for this year. By having Apple as one of their
customers and investing that money they will have a big return and it will help them with the
increasing in profitability for their LCD business. Sharp also wants to focus on expanding
businesses focusing on the Association of Southeast Asia Nations, which is an association of ten
countries in Asia. By expanding to those countries their business will grow and they will gain
more consumers. They also want to reduce fixed costs by introducing all-company cost
restructuring innovation. They will have to find a way to lower their fixed costs finding costs that
are high and that should not be high. Also finding other options for their fixed costs that are
cheaper in order to save more money and improve their financial situation.
As mentioned before for the three-year strategy, Research and Development and
Marketing budgets will be changing. The first year R&D will have a good budget in order for
them to innovate new products that consumers are eager to try and use. They will have to keep
on focusing on their consumers and looking for what consumers want in order to satisfy them
and attract them to their brand. With a good budget for R&D they will focus on innovating
products for consumers. The second year that R&D budget goes down a little and marketing goes
up, the marketing department is going to step up a little and start marketing new products and
innovations, in order to let consumers know about their innovations and attract them into buying
their products to gain profitability. The third year R&D’s budget will drop and Marketing’s

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budgets will go up in order to do a big campaign for all their new productions. Promote the
steady emerging new products with great potentials to be launched in the market for speedy
business expansion. With the marketing budget the goal is to attack the competitors with Sharp’s
innovations, so that consumers are leaning more to Sharp and more attracted to trying the new
products they are coming up with and add more brand awareness. With more brand awareness
Sharp will gain more consumers, since their competitors have been doing an excellent job with
innovation and brand awareness.
Sharp has to keep on working with their staff evaluation system, consulting and setting
goals twice a year with their bosses. They have to challenge themselves without fear of failing.
This is important in order to keep employees engaged with their work. Also keep them interested
in their jobs and managers have to let them know what they expect from them in order for them
to keep up with their work. With the new Board of Directors Sharp has been improving and will
keep on improving and getting in a better financial position.
As mentioned before Sharp has to keep on appointing outside directors who have
international, multifaceted and compliance perspectives on wide range issues, such as social and
economic environment and the future direction of the company. They do this in order to
strengthen the decision-making functions within the Board of Directors and function for
supervising directors’ execution of duties. With their Executive Officer System, which divides
the supervisory and decision-making functions from the business execution functions, and
creating a structure that steadily facilitates and helps them have an efficient business execution.
By introducing the Business Group system, which corresponds to the specific characteristics of
their businesses, they are making reforms aimed at creating a one-stop management structure that
handles development, production and sales. By having an organized corporate governance

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system the company will have more control over everything and will increase their efficiency,
always making that a positive accomplishment for the company through the years. They have to
keep their monthly basis meeting in order for them to improve their management agility and
flexibility and also to clarify the responsibilities of the company’s management.

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Works Cited - Section 3
1. http://comicbook.com/2014/11/19/sony-predicts-new-spider-man-movies-will-drive-
revenue-growth-in/
2. http://www.avclub.com/article/sony-reportedly-considering-spider-man-spinoff-abo-
211708
3. http://uproxx.com/gammasquad/2014/11/sony-is-going-to-be-making-a-lot-of-movies-
based-on-video-games/
4. http://www.global-strategy.net/what-is-global-strategy/
5. http://globalpurchasing.com/blog/electronics-industry-faces-growing-regulatory-
environment

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Contact Information
Brett Ball
Phone: 814-706-7564
Email: bball08@lakers.mercyhurst.edu
Brianne Smail
Phone: 724-882-9742
Email: bsmail08@lakers.mercyhurst.edu
Kaleb Schwab
Phone: 724-816-9693
Email: kschwa04@lakers.mercyhurst.edu
Andrea Novoa
Phone: 814-321-4955
Email: anovoa41@lakers.mercyhurst.edu

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