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Market Entry: A Steel Giant Expands its Horizons
China Concept Research
Market Entry: A Steel Giant Expands its Horizons

Our Challenge: Recommend if and how our client could expand its China business by conducting a market entry analysis in a short timeframe
  • Client: "EuroSteel", a world leader in the steel industry, with committments in China of over US$1 billion when it hired China Concept.
  • Our Mission: Conduct a fast market analysis of a steel product in the construction sector, identify if a market opportunity existed, and, if so, create a market entry plan.
Research: Identify market opportunities
  • Analyzed Policy Environment
    • Interviewed industry policy makers and regulators
    • Identified import duty issues
    • Analyzed differing construction policies and requirements in major provincial markets
  • Examined Current Market Situation
    • Domestic production quality and capacity
    • Import and export situation
    • Market size
    • Major competitors
      • Product type
      • Substitute materials
      • Production quality
      • Geographical markets
      • Development plans
    • Major product users
  • Assessed Market Trends
    • Interviews
      • Industry policy makers and regulators at the central and provincial levels
      • Procurement officers, developers and competitors
      • Major product users
Strategic Recommendations: China Concept concluded that a market opportunity existed and entry should be conducted through local manufacturing
  • Overall Assessment: Market has considerable potential for correctly positioned products
  • Local Manufacturing: The cost sensitivity of the market, combined with the importance of building direct contats with long-term buyers, suggested that the most effective long-term strategy is local manufacturing.
  • Location would be a key issue in the market entry decision
  • Marketing: As part of any long-term marketing effort, it would be important to promote the product as more sophisticated and efficient than versions of the product that were currently available in China
Results: Go-ahead with market engry
  • Based on China Concept's recommendations, EuroSteel was able to identify a long-term opportunity and proceeded with full market entry planning for the product
  • EuroSteel clinched a JV contract with a Chinese company to build a US$1.4 billion steel products plant in eastern China, using China Concept's analysis as part of its overall strategic planning