Hi all,
Recently saw a case question along the lines of:
Your client, the CEO of Company D has decided that he/she needs to expand Company D’s
manufacturing capacity and is considering either building a new plant in Kuala Lumpur, Malaysia, or increasing the scale of its current plant in Singapore. Which would you recommend that they do?
Would the following structure be good enough? I'm not sure it's the most logical, MECE way...
Company
- Current production and capacity
- Reason for expanision
- Market size and growth (to estimate expected revenue from capacity expansion)
- Client expertise / core competencies (e.g. if it is flexibility of manufacturing, this might impact the answer)
- Customer analysis (to identify who/where their customers are and why they buy from Client)
- Any specific criteria the Client has for expansion (i.e. must be within 1 day shipping of suppliers)
Comparison / benchmarking
Compare each of 3 options along the following critieria:
- New expansion capacity
- Cost to build this new capacity
- Cost to run at new capacity
- Distrance from supplies/distributors
- Time to scale
Risks and alternatives
- Consider competitive response
- Risks of expanding into new, unknown regions (e.g. unfamiliar with legal/regulatory aspects, currency fluctuations, potential for shipping delays over long distances)
- Alternatives
- Increase efficiency at current plant
- Outsourcing
- Leasing
- Acquiring another plant
Conclusion
Based on findings
Anyone have anything to add/comment on?
Many thanks in advance.
