Walmart Success In Mexico Canada And China Marketing Essay

Walmart Success In Mexico Canada And China Marketing Essay Global expansion has been gaining a lot of attention from all businesses that planned to expand abroad. Important factors that needs to be considered in the decision making process will be business strategies, entry modes, and threats and opportunities available in the markets. Appropriate strategies used will also help to minimize the risk of failure in the international markets. When a firm makes the right choice of business strategies and entry modes, the firm will then be able to succeed in the market and do well in the market as well. The choice of entry modes and business strategies will influence the future of the retailer in the targeted markets as well. Therefore, retailers who wish to go global should use the most suitable approaches to enter their targeted markets to ensure success to their business. Keywords: global expansion, business strategies, entry modes, threats, opportunities, Walmart Introduction Many researches had been done to study more about internalization of the retail industry and the majority of researches done are mainly used to describe the motivations and scales for international expansion by retailers (Akehurst Alexander, 1995; Williams, 1992). Besides that, many models of internalization explained the sequence of foreign expansion that shows that the companies who go international will do better in foreign markets that are similar to their domestic markets. This is why Walmart chose to enter the markets of Canada and Mexico (Johanson Vahlne, 1977). There are several reasons why international retailing had been a popular issue. Retailers who take the step to go into the international market is mainly because the domestic markets is saturated, needs for larger diverse investments, economic pressures and many external and internal forces that leads retailers to enter new markets and it is important for the retailer to choose the right market entry strategy into th e international markets (Sternquist, 2007). There are several researches done with a conclusion that retailers can minimize the risk of entry strategies by choosing the markets which are similar to the domestic market from the aspects of cultural, geographical and growth potentials. (Barkema Vermeulen, 1998; Welch Welch, 1996). Walmart is established in 1962, by Sam Walton. Walmart got its name from the family name Walton, giving Walmart the meaning of Waltons mart in long. Walmart is a strong company and it managed to survive in the 2008 recession hit in United States. Walmart had been growing fast throughout the years and the sales and market growth were increasing every year. For a fast growing retailer like Walmart, it is important to have use the best entry modes to enter a new market (Fred, 2011). Global expansion Global retail expansion has attracted many businesspersons, especially big sized companies which wish to increase their businesss profits and market share. Global expansion not only attracts large organizations but also small to medium-sized companies, some companies who are new to international expansion as well, and those who are in more mature organizations. The success achieved by newer specialty retailers in the international market, for example, Zara (Spain), HM (Sweden), and Shanghai Tang (Hong Kong) have motivated and created the way for other organizations to follow. However, there is also numerous numbers of well-known retailers who have failed in their expansion in certain global markets which is caused by several reasons, such as regulatory, legal and cultural challenges, competition, and trying to change shopping behavior (Cox, 2011). Besides that, retailers who made the decision to operate only in neighboring markets, as well as it is located geographically close to the ir home markets, will expect to face a lower level of such risks (Burt, 1993; Davis, Desai, Francis, 2000; Hollander, 1970: Knee, 1993; Robinson Clarke-Hill, 1990). Numerous top managers are also becoming more cautious on the problem of maintaining a common identity and culture in the process of trying to build up global enterprises (Joshua Chi, 2007). Moreover, it is very tough for businesses to make their decisions on choosing the most appropriate markets for their business development because there is no accurate and reliable information provided to the businesses. Domestic players in the markets will only portray the potentials side of the markets and hide the disadvantages just to attract businesses into the market (Jackson, Houdard, Highfield, 2008). Comparison of business strategies used by Walmart in Mexico, Canada and China There are different business strategies used by Walmart in Mexico, Canada and China. In Mexico, Walmart acquired Central American Retail Holding Co. who was struggling with accounting issues in 2006. After the acquisition, Walmart renamed the business with Walmart Centroamà ©rica. Central American Retail Holding Co. was previously the largest retailer in Central America. Walmart took the step where they re-launched the whole chain of retail stores under the Central American Retail Holding Co. with wider product assortments, and lower pricing strategy. The reason why they does this is because low pricing strategy is the basic strategy to expand Walmarts philosophy, Every Day Low Price to all part of the world (Basic Strategy: Be More Walmart!, 2011). Walmarts main strategy in Mexico is the multi-format strategy where through this strategy; Walmart can serve different groups of consumers at the same time being able to fulfill all the various needs of these groups of people. Bodega Aur rera in Mexico is the companys fastest growing format. There are three versions of this store. Bodega Aurrera Express stores are designed as very small outlets to serve urban areas such as Mexico City and Monterrey. Mi Bodega Aurrera is designed to serve rural towns and these stores created a great achievement for Walmart (Multiple Formats Equal Flexibility, 2011). In Canada, Walmart Canada is creating a new home branding effort that place the Better Homes Gardens license as the core for both hard and soft home categories (Wal-Mart International Improves Game, 2007). Every products offered has clear and obvious differences from any other products in the market and this will leave a strong image in the customers minds that these products were originated from Walmarts fashion and value chain (Wal-Mart International Improves Game, 2007). Besides that, Walmart Canada is implementing the use of Radio Frequency Identification Technology (RFID) which involves 20 stores and about 12 of their suppliers. This implementation was influenced by the parent country in United States where this system will help eliminate inventories out of stock. The implementation was an important step in the United States and it is important to Walmart Canada as well. Walmart Canada will focus on the use of this technology to improve their supply chain as well as customer se rvices. Equipped stores will be able to use the system to track tagged items in the stores and they can take necessary actions if anything happens. The system is a very important goal to be achieved by Walmart Canada because it can reduce errors occurred in manual restocking methods and the most important issue is that it can reduce over stock in the stores, and it can reduce unnecessary transportation caused which then leads to reduction in emissions of carbons (Mammarella, 2007). The success of Walmart can also be seen through its achievement in having a large grocery insert in its Canadian discount stores where the insert was called Grocery Shelf that provides a big return on capital at low risk (Orgel, 2005). In China, Walmart is targeting to be one of the national retail chains in the country with no interrelated national distribution system.  With this aim, it can be obvious that the rewards are huge, if Walmart is able to succeed. Besides that, the mainland retail market are estimated to be worth US$750 billion by 2008 and this will be a supporting point for Walmart to succeed.  The only thing Walmart need to be worried about is the distribution system.  This is because; the company has given in to unionization demands from the state-run, All-China Federation of Trade Unions, where it shows an important climb down from Walmarts anti-union US point of view (Distribution critical to Wal-Mart China strategy, 2006). However, Walmart will not be influenced. The marketing strategies used by Walmart for BRIC and other developing countries will still involve great huge discounts and great values on all of their products like how they do it in their home country, maintaining low prices ev ery day to all their customers, especially middle-class customers, on the same time, maintaining the growth of their profits as well. According to JPMorgan and analyst Charles Grom, Walmarts main objective for future success is not to overdo Target in the United States. They also said that, Walmart will start to work on more interrelated marketing strategies and merchandising messages to serve their low end customer as well, instead on just focusing on middle-class customers and this could implied to the BRIC countries Walmarts expansions as well (Frazier, 2007). Besides that, Walmart in China had a great success in using cost leadership and this strategy had generated huge revenues for Walmart in China. Therefore, Walmart planned to continue with the cost leadership strategy, as well as implementing a new strategy, that is differentiation (George, 2007). Comparison of entry modes Another reason for retailers to expand into the global markets is because the market in their home country is highly saturated and this created a more competitive market. Therefore, multinational retailers will choose to expand into markets which are less saturated than their home markets. For example, Sears, Kmart and Walmarts most successful expansion is to expand to Mexico and Canada, which is categorized in the North America region. How do multinational retailers choose their entry mode to the selected markets? Multinational retailers that are expanding to markets which are culturally diversified will choose to have a local joint venture with local retailers in the country to help them learn more about the country (Sternquist, 2007). Walmart in Mexico penetrated the market with a joint venture with its local player, CIFRA. CIFRA is the largest retailer in Mexico and Walmart is the largest retailer in the USA. With this reason, Walmarts decision to have a joint venture with CIFRA will definitely be a success because CIFRA will help Walmart have better knowledge on Mexican markets. In Mexico, CIFRA supplied Walmart will supplier connections, knowledge about the local culture as well as helping Walmart to work with local authorities. This will ensure successful expansion of Walmarts power in the Mexican markets, and Walmart can have the greatest influence in the shortest time period. In return of CIFRAs help, Walmart transfers their logistics knowledge to CIFRA which will also help CIFRA to improve on their supply chain management. (Sternquist, 1997). Under Walmarts agreement with CIFRA, Walmart opened membership warehouse clubs, known as Club Aurrera, which does catering to small businesses and selected groups of c onsumers. The first Club Aurrera was opened in Mexico City in December 1991. (Global Push Begins in Mexico, 2012). Besides that, CIFRA and Walmart also announced another two joint ventures, the first one is to start up a wholesale discount Aurrera stores, and the second one is to start up an import-export company that will provide CIFRAs Mexican suppliers to have access to other Walmart outlets in the United States (Millman, 1991). Walmart entered the Canadian markets through the entry mode acquisition. In 1994, Walmart announced its entry into Canada with the purchase of 120 out of 142 Woolco discount stores which are located on the north of the border from the Woolworth Corporation. In 1993, the Woolco stores had total sales of $1.14 billion (Woolco Purchase Yields Entry Into Canada, 2012). Walmart had avoided a time-consuming problem, which are faced by other American retailers who entered the Canadian market, which is to build up stores. Walmart had save their time because they took the step to buy the established stores of Woolco, where most of it had floor space of 100,000 square feet or more. Walmart had also benefited from the making choices for strategic and attractive leases (Woolco Purchase Yields Entry Into Canada, 2012). In 2011, Walmart Canada announced that it had also completed another acquisition from Target Canada with a total of 39 store locations which is currently occupied by Zellers (Canad a Newswire, 2011). Most multinational enterprises had the same thought that entering China is not an option for their business to expand, but it is a strategic necessity for the future of their business. The economy in China is growing rapidly that supports the living of the whole population in China, which is 1.3 billion. China is believed to be a country which has economic superpower and it is a very huge market in the 21st century (Schlevogt, 2000a, 2000b). On the other hand, Walmart is facing slow growth in the United States, and with these available attractive reasons, Walmart aimed to be the top in the retail sector in China with its acquisition of Trust-Mart (Naughton, Schafer, Ansfield, Lin, 2006). Other than using the acquisition strategy, Walmart also used the offshore sourcing strategy. Walmart sees that China is a major production or assembly source country and Walmart needed the help of China for the production and assemble of their products in the United States. Walmart then took the off shore sourcing strategy. Today, Walmart is the single largest export channel from Chinese manufacturers to the United States, with a record of at least 4% in Chinas overseas sales (Goldstein, 2003). Interestingly, Walmart does not have any manufacturing plants in China and it does not have a direct control over the production process of its suppliers in China. Instead, the suppliers are those who take control and responsibility to meet certain levels of requirements, for example cost, quality and delivery (Shih, 2004). With this strategy, Walmart can hold to their Everyday Low Price philosophy. This is because; Walmart can keep their production cost low, at the same time gaining the maximum benefits. Walmart also utilizes its strong bargaining position, at the same time maintaining a high level of ownership. This can be seen in their selling strategy, where Walmart buys the products at a cheaper price from China, and reselling them at a higher price in the United States and other pa rts of the world, at the same time gaining the profits and achieving their aim in providing the lowest prices. In other words, Walmart maintains a high level of ownership control but its management control is low (Goldstein, 2003). Comparison of opportunities and threats Threat and opportunity are two terms which are often used in terms strategic management in businesses (Mintzberg, Raisinghini, Theoret, 1976; Nutt, 1984). These categories are often used to make strategic decisions and it had become a necessity for firms to use these two terms to evaluate their selected markets. The results and issues obtained from environmental analysis are categorized as threats and opportunities faced by the business (Christensen, Andrews, Bower, Hamermesh, Porter, 1982). Opportunities Mexico In 2007, Walmart de Mexico had made a huge investment of $1 billion dollars for new developments and they opened 136 new units from all its existing business formats. This development includes opening of new units of 57 Bodega Aurrera units, 16 Walmart Supercenters, 6 Sams Clubs, 4 Superamas, 15 Suburbia stores and 38 Vips and El Porton Restaurants. The new stores opened spreads on two categories, the existing cities and new cities. The expansion in new cities can increase the firms coverage of new customers, and as for the existing cities, Walmart will have the advantage to dominate the market more widely. Besides that, the expansion of new stores will help boost the amount of new customer, as well as result in greater sales (DATAMONITOR: Wal-Mart de Mexico., 2008). The consumers today have changing preferences on choices of places to buy groceries and other daily products. customer now no longer prefer traditional retail, and they now prefer larger and more standardized hypermarket and supermarket chains, and the most important is the stores can offer lower and more attractive prices, as well as providing the convenience to the customers. In Mexico, the market share of modern formats of stores had increased almost 50% as compared from year 2005-2010. The change in the customers preferences will create an opportunity for Wal-Mart to expand its chains to more cities in Mexico (DATAMONITOR: Wal-Mart de Mexico., 2008). China Walmart Stores had signed an agreement to acquire a little stake of Yihaodian.com, Chinas largest online retailer. If the acquisition is successful, Walmart will have the chance to expand their business to the world of online shopping market, which will then generate more revenue. However, Chinas anti-monopoly bureau considers the acquisition might create an effect that exclude or restrict the competition of value-added telecommunications services market segments in China (China approves Wal-Mart control of Yihaodian., 2012). Apart from Walmart having control of services of Yihaodian.com, Yihaodian.com can also take the advantage of using Walmarts supplier and logistics resources to increase their stock-keeping unit by tracking the inventories closely using the system (Mass Grocery Retail., 2012). Another opportunity available for Walmart is the concept of discount store formats. Walmart can take the first step to start a discount store format expansion before other retailers do because the discount store format is now an attractive option for retailers in China. Walmart is the biggest retailer in China because of the acquisition of Trust-Marts 100-outlet-strong hypermarket network. Therefore, Walmart has the opportunity to expand in China, by launching a new discount compact hypermarket format formed under Trust-Mart in China (Mass Grocery Retail., 2012). Canada Walmart in Canada can expand its chain to the food retailing sector in Canada, since Target will be a competitor of Walmart in Canada. Walmart will have the competitive advantage over Target if they were to get involved in the food retailing industry because Target may be limited in food retailing (Orgel, 2011). Walmart Canada had announced the retailers planning of opening three supercenters in Quà ©bec. Walmart also ensures the quality of products they offer in the new store to gain customers confidence (Canada, 2011). Besides that, Walmarts low price strategy had given Walmart a great opportunity compared to other retailers in Canada, and this will ensure that Walmarts path in Canada will be stable (Swain, 1994). Another opportunity for Walmart in Canada is their decision to bring their warehouse club, Sams Club into Canada and this will help Wal-Mart by gaining increasing popularity in the market (Robin, 2003). Threats Mexico In February 2006, Mexicos retail association Asociacion Nacional de Tiendas de Autoservicio y Departamentales (ANTAD) sent many requests to the Congress to approved the proposals to upgrade the anti-monopoly laws to an international standards. This will affect Walmart de Mexico, because, if the laws are being approved, Walmart de Mexico will lose its advantage of its better technology and larger size as compared to other smaller retailers, to offer the lowest prices in the market. Walmart Stores is also facing this problem in the companys parent country in United States because, Walmart is a big retailer, and they are offering low prices and this will affect smaller retailers to quit from the industry. In this case, Walmart de Mexicos expansion plans in Mexico will be affected by the laws and regulations in Mexico (DATAMONITOR: Wal-Mart de Mexico., 2008). Other than that, another main issue that Walmart Mexico faces is opposition towards their expansion in Mexico, mainly from the government and local retailer. A slow growing economy will cause a lower purchasing power in a country. The economy in Mexico is an important threat to Walmart because the slow growth in the Mexican economy will affect the consumer spending and it will affect Walmarts growth in Mexico (DATAMONITOR: Wal-Mart de Mexico., 2008). Besides that, the intense competition in Mexico will also be a threat for Walmart. In Mexico, Walmart is also facing a strong competition from Mexican supermarket chains because the retail industry in Mexico is saturated. Some examples of Walmarts strong international and domestic competitors are Organizacion Soriana, Controladora, Chedraui, and Gigante. These retailers are having an intense competition with Walmart. The increasing competition from these retailers might affect Walmart de Mexico, especially in terms of profitability (DATA MONITOR: Wal-Mart de Mexico., 2008). China Walmart plans to expand bigger in China and the company had planned to open another ten stores throughout the urban areas. However, the effort faced some challenges, mainly from the government of China. Chinas state-controlled All-China Federation of Trade Union (ACFTU) had planned to take the action to sue Walmart as well as other non-Chinese companies if these companies do not have union branches in their Chinese operations. The main problem in this issue is, Walmart is well-known for their anti-union stance. In order for them to survive in the market, Walmart had agreed to respect the choice of their employees in China who wants to set up a union. This action may benefit China, but Walmart will have restrictions handling employee benefits and limited ways in resolving grievances. Even though there were many problems faced, as a multinational retailer, it is a must for Walmart to adapt to the specific markets they are operating in (Wal-Mart: in union with China, 2005). Canada Walmart Canadas largest threat will be the acquisition of Zellers Inc. by Target Corporation. The entry of Target Corporation will be another add-on to the intense competition of retailers in Canada. In the acquisition, Target took over 220 stores under Zellers, and this could impact Walmart as a big retailer because Target is growing fast after the acquisition (Orgel, 2011). The retail industry in Canada is very intense and saturated and the retail market is full of strong grocers and this will be a threat for Walmart because there will be more competition and this will slow down and eventually reduce Walmarts sales in Canada (Dunn, 2006). Besides that, Walmart also faces Canadas regulatory threats where Walmart needs to face the legal challenges from Saint-Hyacinthe certification (Springer, 2005). Besides that, Walmart is trying to introduce organic food in the country as well, and this will be a threat to Walmart because Walmart does not have a proper marketing strategy to market the product in their stores in Canada because there are other small-sized organic food suppliers which can offer a lower price (Goodbaum, 2006). Discussion Walmart is indeed a good example of a successful retailer that successfully expands and survives in the international markets. This also proves that there is the potential for retailers in domestic markets to expand their business into the international market with the condition that they use the appropriate marketing strategies and entry modes to penetrate the market. However, Walmart should also have sufficient information on the markets so that they can adapt into the market with lesser barriers. Walmart had been a successful retailer in the United States and today, and they are still growing across the world, mainly in United States, Canada and Mexico. Walmart also uses different types of marketing strategies and entry modes to dominate the markets, and this gives the large retailer a huge competitive advantage over other retailers in the market because, Walmarts philosophy, Every Day Low Price had been successfully applied throughout the world where this philosophy had helped Wa lmart greatly in surviving in different markets on the same time providing Walmart with a bright future. Walmart choices of strategies in the Mexican, Canadian and China markets also portray the firms success in adapting into the country. Walmart in Mexico used the multi format strategy to set up different types of stores to satisfy majority needs and demands of the markets, and this helped Walmart in achieving a greater amount of concentration of customers. The Bodega Aurrera store chains are proves the firms intelligence in dominating the market. These stores have different concepts such as discount stores and convenience stores that will serve different types of customers in different areas in Mexico. Secondly, in Canada, Walmart uses the retail format development strategy to approach the market. Walmart in Canda extend their offerings into the home furniture sector where these furnitures can only be found in Walmart. This will create brand awareness and brand loyalty towards Walmart in the customers. Besides that, Walmart also made full use of their satellite communication system to frequently check on the inventories in Walmart stores to decrease shortage in supply. In Canada, Walmart also have discount stores where these stores can generate high profits with low risks in the country. Thirdly, Walmart in China had achieved a huge success by using the cost leadership strategy in the country to attract more people. This is because, the population and economy in China is growing, and Walmart can have large sales volumes, with lower price, to achieve high sales records to maintain their sustainability. Other than these successes, Walmart had also used the appropriate entry modes to enter the markets. In Mexico, Walmart uses the joint venture mode with Mexicos largest retailer, CIFRA. This joint venture had benefited Walmart in the sense that, CIFRA can provide the firm with information on the markets in Mexico, and Walmart can save their time on the process of understanding the markets. This will give Walmart the advantage to grow faster in the market. The strategy used by Walmart in Canada is the acquisition mode, where the firm took over the operations of Woolco, a weak retailer in the Canadian markets. With this acquisition, Walmart does not need to worry on the locations of their stores, because the Woolco buildings were available, since the firm had took over them. In China, Walmart use the offshore sourcing strategy together with the acquisition strategy where Walmart can reduce their cost to find new locations, as well as reducing their production costs because production co sts in China is lower compared to the United States. From the different choices of entry modes that Walmart chose, all of the strategies are working well in different markets, where these strategies helped Walmart to have a strong base in the markets. Walmart have the potential in growing in the spread of their retail stores to outside their region. With the strong market base that Walmart is standing on, it will not be a major problem if Walmart were to expand into other regions in the world. However, Walmart needs to take care of the regulations of the countries they are penetrating, as well as the intensity of the competition in the markets. Conclusion Walmarts decision to expand globally had made a huge success to the firm and this can be seen in Walmarts domination in the markets. Walmarts success had been a glorious story in the business world for being able to sustain their businesses not only domestically, but also in the global context. The business strategies and entry modes used were wisely chosen and it ensures long term profitability to the firm. Even though there are challenges faced in the respective markets they penetrated successfully, Walmart still have outstanding performances in overtaking their competitors in the retail industry. Besides that, Walmart also have very strong strategic management skills because, Walmart choose their locations and targets countries carefully where this leads to the route of success for Walmart as well. Walmart success can also be credited to their efforts in satisfying their customers from all classes. Walmart offers a wide range of products where it covers all varieties of products, from the highest price to the lowest price which is still the lowest retail price in the retail industry. With this point, Walmart will have loyal customers that will make repeated purchases in the stores. Another notable success of Walmart is, the firm is able to survive even in the toughest period of the economy, during recession. Not all businesses can survive in the recession period, because during recession, the cycle of business processes will contract, which will result in slow business growth and there will be unemployment all around. Yet, Walmart still can survive and continue its business operations during the recession period. With only this point, Walmart is considered the most successful retailer in the retail industry for being able survive no matter what environment they are in.

Recover from Drug Addiction: Process vs Event Essay

Picking up the broken pieces of a life filled with insanity and drug abuse, is no overnight task. I’m not just talking of the heroin addict in the 1960s. Recovery from addiction takes constant specialized care. Through intensive work, the addiction can be arrested. The process starts with the person admitting they have a problem. This is the first step to begin to recover. Most importantly, continued involvement with self- help groups is essential. These actions are only a beginning of a life- long journey. Pain medications prescribed by doctors is adding to a problem that already exists. Cares, Council on Addiction Recovery and Educational Services , is aware of the ongoing problem. Potent opiate based pills, derived from the poppy plant, are highly addicting. Hydrocodone, Oxycodone and Lora Tab all contain opiates. The three mentioned are more addicting, readily available than other street drugs (heroin, cocaine, marijuana, methafedimine or hallucigens. ) After listening to many of these addicts in the rooms of NA (Narcotics Anonymous) I’ve gained a better understanding of the extensive problem that exists. My drug of choices were Alcohol, marijuana, ocaine and hallucigens. The society we live in today has more of a variety of mood changing and mind altering chemicals. ( ecstasy, crack cocaine, angel dust, formaldehyde, etc. ) Our youth and our elderly are at risk of being controlled by the stereotypes of taking these highly toxic chemicals as treatment. There is a false sense of security being influenced so the pharmaceutical companies and their stock holders can get rich. Preservation of life has fallen short for greed, personal status and the attitude of irrational beliefs. The damage being done will take years for those so reliant on a pill to overcome. The average recovering addict is not only the old school heroin junkies but school teachers; teenagers, elderly, professionals, businessman and pillars of our communities. Most importantly this epidemic has affected religious sectors of our cities, towns and villages throughout the world. I don’t know how many times I’ve browsed through the newspaper or watched television and seen skits on priests, pastors and ministers caught in active addiction. Recovery is an ongoing process, we don’t graduate from treatment. The best known treatment for chemical dependency has been proven to work in the rooms of NA; through the 12 steps, the fellowship and service work. Some of us who have been guided by a greater consciousness by our groups are fortunate. Many addicts never find NA or shrug off the help when presented, as a result end up in jails, institutions, dereliction and death. NA is recovery in action, focusing on treating the disease of addiction. Those affiliated with NA; that have recovered from a hopeless state of mind nd body, have a singleness of purpose, to carry the message to addict who still suffers. Throughout all continents; many families, friends, relatives are uneducated, misinformed on how insidious this disease is and how true recovery works. Recovery is a journey not a 30 day rehab and you’re cured. Rehabs only give the addict time to dry out in a drug-free safe environment, keep drugs out of reach and some basic information on what action to take upon leaving. The real treatment begins with continued participation in a support group such as NA. The saying in NA is â€Å"you never have to be lone again†. The work within the 12 steps of NA is what treats the disease of addiction. Honesty, Acceptance, forgiveness, humility, and responsibility are the stepping stones to designing a new life. The new lifestyle you developed while working through the 12 steps and applying them in your life brings freedom from active addiction. Addicts will always have the disease of addiction, they say in NA â€Å"you can’t change a pickle back into a cucumber†. The action taken in the 12 steps creates new Attitudes. Whereas the addict obtains the skills and knowledge to become a productive member of ociety. All these facts can be found in the Basic Text of NA, and are the basis of recovery. The statements in the preceding paragraphs are facts based on experience. There is nothing more powerful than the experience of the predecessors in NA, other than god himself. As one addict helping another is without parallel, we do recover. NA as a whole is guided by a god consciousness . Unity between groups holds the program together. With the 12 Steps, the 12 Traditions at the center. The Traditions are the ties that bind us together, it is only through understanding and application they work. They are the principles that keep our fellowship alive and free. The guidelines written within the Traditions help the members of NA grow spiritually. Addiction is such a cunning enemy of life that we alone have lost the power to do anything about it, without help from each other it would be too much for us. Narcotics Anonymous has websites with information about meetings established in every country worldwide. Getting involved with service within the fellowship will give the addict tools to help stay clean as well as people skills to be productive in society. For many addicts addiction leads into isolation, so as not to be discovered or arrested. Service offers more than just a life without using drugs, it offers a new path to freedom and a sense of belonging. The positions that NA offers doesn’t stop at the group level, service continues into Area, Regional and World Service (Chairperson, Vice Chair, RCM, Literature, Treasurer, NA Hotline-Phone, Delegates and Alternates. ) The World Service board controls the printing of books, literature, key tags and many other services needed to keep NA functioning in a Productive anonymous manner. I know a few people in the area I live in who have been all over the world speaking at conventions which was paid for by World Services. They have experienced the unlimited growth that NA has to offer. They told me it was the most invigorating chance to carry the message of hope into another addict’s life. There are members I know that have 30 plus years in recovery that say there is always something new to learn. The journey in NA has no boundaries and is open to any man or woman who seeks it. Recovery from active addiction is a process not an event.

EMI Corporate Finance Essay

In this Internet age, the consumer is using music content more than ever before— whether that’s playlisting, podcasting, personalizing, sharing, downloading or just simply enjoying it. The digital revolution has caused a complete change to the culture, operations, and attitude of music companies everywhere. It hasn’t been easy, and we must certainly continue to fight piracy in all its forms. But there can be no doubt that with even greater commitment to innovation and a true focus on the consumer, digital distribution is becoming the best thing that ever happened to the music business and the music fan. —Eric Nicoli, CEO, EMI Group1 In early spring of 2007, Martin Stewart drove through the darkened streets of Kensington in West London. As chief financial officer (CFO) for global music giant EMI, Stewart already knew most of the news that would break at the company’s April 18 earnings announcement. Annual underlying revenue for the company was down 16% to GBP 1.8 billion (British pounds). Earnings per share (EPS) had also dropped from 10.9 pence (p) in 2006 to −36.3p in FY2007 (fiscal year). Those disappointing numbers were roughly in line with the guidance Stewart had given investors in February. The performance reflected the global decline in music industry revenues, as well as the extraordinary cost of the restructuring program EMI was pursuing to realign its investment priorities and focus its resources to achieve the best returns in the future. The earnings announcement would include an announcement of the dividend amount, which had not yet been determined. The board would meet soon to review EM I’s annual results, International Federation of Phonographic Industry (IFPI), â€Å"IFPI: 07 Digital Music Report,† January 2007. This case was written by Elizabeth W. Shumadine (MBA ’01), under the supervision of Professor Michael J. Schill, based on public information. Funding was provided by the L. White Matthews Fund for Finance case writing. Copyright  © 2008 by the University of Virginia Darden School Foundation, Charlottesville, VA. All rights reserved. To order copies, send an e-mail to sales@dardenbusinesspublishing.com. No part of this publication may be reproduced, stored in a retrieval system, used in a spreadsheet, or transmitted in any form or by any means— electronic, mechanical, photocopying, recording, or otherwise—without the permission of the Darden School Foundation. Rev. 2/09. .2 On an annual basis, EMI had consistently paid an 8p-per-share dividend to ordinary shareholders since 2002 (Exhibit 1). Now in light of EMI’s recent performance, Stewart questioned whether EMI should continue to maintain what would represent a combined GBP 63-million annual dividend payment. Although omitting the dividend would preserve cash, Stewart appreciated the negative effect the decision might have on EMI’s share price, which was currently at 227p. Stewart recognized that EMI faced considerable threat of a takeover. Although its board had recently been able to successfully reject an unsolicited 260p-per-share merger offer from U.S. rival Warner Music, there remained considerable outside interest in taking  over EMI. It seemed that boosting EMI’s share price was imperative if EMI was to maintain its independence. EMI With a storied history that included such names as the Beatles, the Beach Boys, Pink Floyd, and Duran Duran, it was not difficult to understand why EMI considered its current and historical catalog of songs and recordings among the best in the world. EMI, Warner Music Group, Sony BMG Music Entertainment, and Universal Music Group, collectively known as â€Å"the majors,† dominated the music industry in the early 21st century and accounted for more than two-thirds of the world’s recorded music and publishing sales.3 Exhibit 2 contains a list of the global top-10 albums with their respective record labels for the last four years. Recorded music and music publishing were the two main revenue drivers for the music industry. EMI divided its organization into two corresponding divisions. EMI Music, the recorded-music side, sought out artists it believed would be long-term commercial recording successes. Each EMI record label marketed its artist’s recordings to the public and sold the releases through a variety of retail outlets. EMI’s extensive music catalog consisted of more than 3 million songs. Recorded-music division sales came from both new and old recordings with existing catalog albums constituting 30% to 35% of the division’s unit sales. Exhibit 3 contains a list of EMI’s most successful recording artists in FY2007. EMI Music Publishing focused not on recordings but on the songs themselves. Generally, there were three categories of publishing-rights ownership in the music industry: the lyric’s author, the music’s composer, and the publisher who acquired the right to exploit the song. These publishing-rights owners were entitled to royalties whenever and however their music was used. Music publishers categorized their revenue streams as mechanical royalties (sales of recorded 2 In the United Kingdom, companies typically declared dividends twice a year, first with the midyear results and second with the full-year results. Typically, EMI paid an interim dividend of 2p per share and a final dividend of 6p per share. In addition, both EMI’s interim and final dividends were paid out to shareholders in the following fiscal year. In November 2006,  EMI’s board committed to paying the interim dividend of 2p per share following its 2007 fiscal midyear results with actual payment to shareholders expected in April 2007. Both the 2p interim dividend and the recommended final dividend would be reflected in the 2008 financial statements. 3 EMI included a fourth category of royalties labeled â€Å"other,† which included sales of sheet music and, increasingly, mobile ring tones and ring backs. Similar to the recorded-music division, the music-publishing division identified songwriters with commercial potential and signed them to long-term contracts. The division then assisted the songwriters in marketing their works to record companies and other media firms. EMI’s current publishing catalog encompassed more than 1 million musical compositions. Exhibit 3 includes a list of EMI’s most-successful songwriters in FY2007. EMI’s publishing business generated onefourth of the total group revenue. Revenue in the publishing business was stable, and  operating profits were positive. In addition to seeking out and signing flourishing recording artists and songwriters to long-term agreements, both EMI divisions also expanded and enhanced their individual catalogs and artist rosters by strategic transactions. Two key acquisitions for EMI’s recorded-music division were the 1955 acquisition of a leading American record label, Capitol Records, and the 1992 acquisition of Virgin Music Group, then the largest independent record label. Together the transactions added such key recording stars as Frank Sinatra, Nat King Cole, Janet Jackson, and the Rolling Stones. The music-publishing division similarly targeted existing publishing assets with large, proven commercial potential such as the purchase in various stages of Motown founder Berry Gordy’s music catalog in 1997, 2003, and 2004. Since the company’s founding in 1897, EMI’s model had been that of â€Å"constantly seeking to expand their catalog, with the hits of today forming the classics of tomorrow.†4 Both divisions pursued the goal of having the top-selling artists and songwriters and the deepest, mostrecognized catalog assets. EMI welcomed technological innovations, which often drove increased music sales as consumers updated their music collections with the latest music medium (e.g., replacing an LP or cassette with the same recording on compact disc). But the latest technology, digital audio on the Internet, was different and revolutionary. Digital audio on the Internet demanded rethinking the business model of all the majors, including EMI. Digital Audio and the Music Industry Digital audio had been around since the advent of the compact disc (CD) in the early 1980s, but the 1990s combination of digital audio, Internet, and MP3 file format brought the music industry to a new crossroads. The MP3 format had nearly the same sound quality as CDs, but its small file size allowed it to be easily downloaded from the Internet, stored on a computer hard drive, and transferred to a digital audio player, generally referred to as an MP3 player. Peer-to-peer file-sharing Internet services, most notably Napster, emerged in the late 1990s. First available in mid-1999, Napster facilitated the exchange of music files. The use of Napster’s file-sharing program exploded, and Napster claimed 20 million users by July 2000. EMI Group PLC annual report, 2007. Napster’s swift growth did not go unnoticed by the music industry. While the Recording Industry Association of America (RIAA) was eventually successful in using the court system to force Napster to remove copyrighted material, it did not stop peer-to-peer file sharing. New services were quickly developed to replace Napster. The International Federation of the Phonographic Industry (IFPI), an organization representing the recording industry worldwide, estimated that almost 20 billion songs were downloaded illegally in 2005. EMI was an early presence on the Internet in 1993. In 1999, EMI artist David Bowie’s album, hours†¦, was the first album by a major recording artist to be released for download from the Internet. None of the record labels were prepared, however, for how quickly peer-to-peer file sharing would change the dynamics of the music industry and become a seemingly permanent thorn in the music industry’s side. In the wake of Napster’s demise, the music labels, including EMI, attempted various subscription services, but most failed for such reasons as cost, CDburning restrictions, and incompatibility with available MP3 players. Only in the spring of 2003, when Apple launched its user-friendly Web site, iTunes Music Store, did legitimate digital-audio sales really take off in the United States, the world’s largest music market. Apple began to expand iTunes globally in 2004 and sold its one-billionth download in February 2006. According to the IFPI, there were  500 legitimate on-line music services in more than 40 countries by the beginning of 2007, with $2 billion in digital music sales in 2006. Despite the rise of legally downloaded music, the global music market continued to shrink due to the rapid decline in physical sales. Nielsen SoundScan noted that total album units sold (excluding digital-track equivalents) declined almost 25% from 2000 to 2006.5 IFPI optimistically predicted that digital sales would compensate for the decrease in physical sales in 2006, yet in early 2007, IFPI admitted that this â€Å"holy grail† had not yet occurred, with 2006 overall music sales estimated to have declined by 3%.6 IFPI now hoped digital sales would overtake the decline in physical sales in 2007. Credit Suisse’s Global Music Industry Forecasts incorporated this view with a relatively flat music market in 2007 and minor growth of 1.1% to 1.5% in 2008 and 2009.7 The Credit Suisse analyst also noted that the music industry’s operating margins were expected to rise as digital sales became more significant and related production and distribution costs declined.8 Lehman Brothers was more conservative, assuming a flat market for the next few years and commenting that the continued weakness in early 2007 implied that the â€Å"market could remain tough for the next couple of years.†9 Many in the industry feared that consumers’ ability to unbundle their music purchases— to purchase two or three favorite songs from an album on-line versus the entire album at a physical retail store—would put negative pressure on music sales for the foreseeable future. A Bear Stearns research report noted: While music consumption, in terms of listening time, is increasing as the iPod and other portable devices have become mass-market products, the industry has still not found a way of monetizing this consumption. Instead, growing piracy and the unbundling of the album, combined with the growing power of big retailers in the physical and iTunes in the digital worlds, have left the industry in a funk. There is no immediate solution that we are aware of on the horizon and in our view, visibility on sales remains poor.10 Recent Developments at EMI The last few years had been incredibly difficult, particularly within EMI’s recordedmusic division, where revenues had declined 27% from GBP 2,282 million in 2001 to GBP 1,660 million in 2006. (Exhibits 4 and 5 show EMI’s financial statements through FY2007.) Fortunately, downloadable digital audio did not have a similar ruinous effect on the publishing division. EMI’s publishing sales were a small buffer for the company’s performance and hovered in a tight range of GBP 420 million to GBP 391 million during that period. CEO Eric Nicoli’s address at the July 2006 annual general meeting indicated good things were in store for EMI in both the short term and the long term. Nicoli stressed EMI’s exciting upcoming release schedules, growth in digital sales, and success with restructuring plans. EMI’s digital sales were growing and represented an increasingly large percentage of total revenues. In 2004, EMI generated group digital revenues of GBP 15 million,  which represented just less than 1% of total group revenues. By 2006, EMI had grown the digital revenue to GBP 112 million, which represented 5.4% of total group revenues. The expected 2007 digital sales for EMI were close to 10% of group revenues. Given the positive expectations for its 2007 fiscal year, financial analysts had expected EMI’s recorded-music division to see positive sales growth during the year. EMI’s surprising negative earnings guidance on January 12 quickly changed its outlook. EMI disclosed that the music industry and EMI’s second half of the year releases had underperformed its expectations. While the publishing division was on track to achieve its goals, EMI’s recorded-music division revenues were now expected to decline 6% to 10% from one year ago. The market and investor community reacted swiftly to the news. With trading volume nearly 10 times the previous day’s volume, EMI’s market capitalization ended up down more than 7%. EMI further shocked the investment community with another profit warning just one month later. On February 14, the company announced that the recorded-music division’s FY2007 revenues would actually decrease by about 15% year-over-year. EMI based its new dismal forecast on worsening market conditions in North America, where SoundScan had calculated that the physical music market had declined 20% in 2007. The investment community punished EMI more severely after this second surprise profit warning, and EMI’s stock price   dropped another 12%. British newspaper The Daily Telegraph reported shareholders were increasingly disgruntled with performance surprises. One shareholder allegedly said, â€Å"I think [Nicoli]’s a dead duck. [EMI] is now very vulnerable to a [takeover] bid, and Nicoli is not in any position to defend anything. I think the finance director [Martin Stewart] has also been tainted because it suggests they did not get to the bottom of the numbers.† EMI analyst Redwan Ahmed of Oriel Securities also decried EMI management’s recent news: â€Å"It’s disastrous †¦ they give themselves a big 6% to 10% range and a month later say it’s 15%. They have lost all credibility. I also think the dividend is going to get slashed to about 5p.†11 Exhibit 6 contains information on EMI’s shareholder profile. As its fiscal year came to a close, EMI’s internal reports indicated that its February 14 forecast was close to the mark. The recorded-music division’s revenue was down, and profits were negative. The publishing-division revenue was essentially flat, and its division’s margin improved as a result of a smaller cost base. The company expected underlying group earnings before interest, taxes, depreciation, and amortization (EBITDA), before exceptional items, to be GBP 174 million, which exceeded analysts’ estimates. Digital revenue had grown by 59% and would represent 10% of revenue. EMI management planned to make a joint announcement with Apple in the next few days that it was going to be the first major music company to offer its digital catalog free from digital-rights management and with improved sound quality. The new format would sell at a 30% premium. EMI management expected this move would drive increased digital sales. Management was pleased with the progress of the restructuring program announced with the January profit warning. The plan was being implemented quicker than expected and, accordingly, more cost savings would be realized in FY2008. The program was going to cost closer to GBP 125 million, as opposed to the GBP 150 million previously announced. Upon completion, the program was expected to remove GBP 110 million from EMI’s annual cost base, with the majority of savings coming from the recorded-music division. The plan reduced layers in the management structure and encouraged the recorded-music and publishing divisions to work more closely together for  revenue and cost synergies.12 One headline-worthy change in the reorganization was the surprise removal of the recorded-music division head, Alain Levy, and Nicoli taking direct responsibility for the division. The Dividend Decision Since the board had already declared an interim dividend of 2p per share in November 2006, the question was whether to maintain the past payout level by recommending that an additional 6p final EMI dividend be paid. Considering EMI’s struggling financial situation, there was good reason to question the wisdom of paying a dividend. Exhibit 7 provides a forecast of the cash flow effects of maintaining the dividend, based on market-based forecasts of 11 Alistair Osborne, â€Å"Nicoli ‘a dead duck’ as EMI issues new warning,† Daily Telegraph, February 16, 2007. Restructuring efforts over the previous three years had collectively saved the company GBP 180 million annually; however, the result was a one-time implementation cost of GBP 300 million. Omitting the dividend, however, was likely to send a message that management had lost confidence, potentially accelerating the ongoing stock price decline—the last thing EMI needed to do.13 (Exhibit 9 depicts trends in the EMI share price from May 2000 to May 2006.) Many believed that music industry economics were on the verge of turning the corner. A decision to maintain the historical 8p dividend would emphasize management’s expectation of business improvement despite the disappointing recent financial news. Forecasts for global economic growth continued to be strong  (Exhibit 10), and reimbursements to shareholders through dividends and repurchases were on the upswing among media peers (Exhibit 11). As Stewart navigated his way home, the radio played another hit from a well-known EMI artist. Despite the current difficulties, Stewart was convinced there was still a lot going for EMI. Historically, there was strong evidence of significant negative stock-price reactions to dividend cancellations (see Balasingham Balachandran, John Cadle, and Michael Theobald, â€Å"Interim Dividend Cuts and Omissions in the U.K.,† European Financial Management 2:1 (March 1996), 23–38, for a study using only British firms, and Roni Michaely, Richard Thaler, and Kent Womack, â€Å"Price Reactions to Dividend Initiations and Omissions: Overreaction of Drift?† Journal of Finance, 50, 2 (June 1995), 573–608, for a larger study using U.S. firms. Both academics and practitioners vigorously debated the impact of dividend policy. In fact, Nobel laureate economists had argued that dividend policy should maintain little relevance to investors. Exhibit 8 contains a summary of Modigliani and Miller arguments.

Book Report Fault in Our Stars - 1243 Words

The Fault in Our Stars The Fault in Our Stars is a novel written by John Green. This book was published in 2012 by â€Å"The Penguin Group† with 313 pages. The Fault in Our Stars is a work of fiction, everyone/everything is this book is made up by the author’s imagination. â€Å"The Fault in Our Stars† is a #1 New York Times Bestseller, award winning, and motion picture romance. The reader will follow Hazel and Augustus as these extraordinary teenagers go on a journey that soon turns into a long lasting relationship. Hazel Grace Lancaster has cancer, thyroid cancer that has gotten in her lungs and now it has affected her body. Hazel doesn’t had a lot of time to live, but she’s okay with that. Hazel just want to be a regular teenager just like me†¦show more content†¦Hazel tells Peter to get help and sober up so he can write another book. Hazel eventually learns that the ending Augustus wrote to Imperial Affliction he sent it to Peter so he could put that in Hazel’s eulogy when she dies. Peter sent the words that Augustus wrote to her and it stated that this world is inevitable, but we choose who we allow to hurt us. Augustus states he’s happy with it and hope Hazel is too. Hazel says she is too. In my opinion, the author really does achieve his purpose. John Green wrote this book because he worked at a children’s hospital where he saw many children trying to fight for their life. At the children’s hospital the kids were fighting life threatening illnesses and it just inspired him. Another reason John Green wrote this book was because he had a friend that died from cancer. Just like in the book, Hazel had thyroid cancer and so did the author’s friend. John Green purpose was proven when he wrote this book. The Fault in Our Stars was very effortless to read. I caught on very easy, because the author had it setup for young adults’. This book showed a lot of happiness that cancer patients could have and the love each one had for each other. This novel was so POWERFUL because Hazel didn’t let her cancer define her, she didn’t let her cancer stop her from walking up stairs at the Anne Frank house, and she didn’t let her cancer stop h er from loving Augustus. I think there were manyShow MoreRelatedEssay The Fault in Our Stars by John Green1722 Words   |  7 Pages In John Green’s The Fault in Our Stars, cancer possess every character in distinctive ways, yet this isn’t the standard cancer book, because according to the protagonist, â€Å"cancer books suck† (Green 3). Or as Gwynne Ellen Ash views the novel as a, â€Å"learning to trust, and to love, while dying [†¦] there is no sap here, no melodrama, no maudlin schmaltz.† This is about being able to cope with existence. 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