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Business Decision Strategy

The Chinese Fireworks Industry

You have been hired as a consultant by businessman Jerry Yu. He is considering entering into the fireworks industry, and wants your advice on how he should proceed. Evaluate this opportunity and present your recommendations to him by answering questions below:

1. Tell Mr. Yu what you think about his situation and what he has going for him (good and bad) as relates to becoming a businessman investing in the fireworks industry.

2. Tell Mr. Yu what you think about the Fireworks industry and where there are profits to be made in this industry. Think about which segments/participants in the fireworks industry are in the best and worst positions to thrive and make profits.

3. Should Jerry Yu invest in a Chinese fireworks factory - Yes or No? Why/Why not? Think both about Jerry Yu's situation, and your industry analysis.

4. If Jerry Yu insists on entering the fireworks industry in some way, how would you recommend that he do it? What part of the industry should he get involved in? Selling what, to whom? Why would this be a good strategy for Jerry?

5. If Jerry Yu agrees with you and wants to follow your advice and proceed, what are the top 3-5 action steps that he could follow to make this happen? Explain.

Solution Preview

1. What you have going for you is the fact that you are a highly experienced businessman, you have an established customer base, and you have access to cheap raw materials that are needed to produce fireworks. On the negative side is that you know very little about the fireworks industry, as well as the fact that it would be time-consuming to gather the necessary experienced staff members and material resources for this business venture.

2. The fireworks industry ...

Solution Summary

This response details the strategic components of making an effective business decision.