The company has been an innovator in components for LED products. The market for LED products, based on some research LumCO has conducted, is expected to grow by 24% p.a. until 2019 in Asia and by 17% in North America, with China and the United States being the key markets in both regions. Key experts on the lighting industry further assume that there will be a significant split in the lighting market with regard to technological features required in component products, which are believed to be either very high (e.g. light density, scope, area of light) or very basic.
LumCO, a company producing injection-molded components for lighting applications, has operated successfully in its native European market. The company wants to open up one production facility each in China and the United States and establish their own distribution network in both countries to serve as a hub for the entire region. The products LumCO manufactures can be categorized into Specialties, which are designed and produced by LumCO according to customer specifications (e.g. head lamp casing and lenses in vehicles, luminaires for design lighting applications) and Standards, which encompasses an assortment of components for multiple lighting applications for different industries (fixtures, lenses, luminaires).
Based on the only slight but stable growth outlook in Europe, LumCO is eager to establish the production sites in China and the U.S. as soon as possible and also to begin to distribute their products directly. As a consultant, you are asked by the board of management to assess this plan considering your knowledge of each region and the lighting market in particular.