Internationa Business Audit Avery Dennison in Chile

Global Business

Management Audit

Avery Dennison

Corporation

Module 1: Indentifying Global Business Opportunities

Company Name: Avery Dennison Corporation (Classification: 20201060)

Company Sector: Industrials

Industry Group: Commercial Services & Supplies

Industry: Commercial Services & Supplies

Sub Industry: Office Services & Supplies

Avery Dennison Corporation is a diversified company that produces pressure-sensitive adhesives and materials for industrial and consumer uses. Avery Dennison's products include pressure-sensitive labeling materials; graphics imaging media; retail apparel ticketing, branding systems; RFID inlays and tags; office products; specialty tapes; and a variety of specialized labels for automotive, industrial and durable goods applications. Since its humble beginning in 1935 from a 100-square-foot loft in Los Angeles, California the company has grown to become a global enterprise with about 31,300 employees in over 200 facilities in more than 60 countries and product sales in 89 countries worldwide. Avery operates under a global area division structure because through regional presence of its divisions the company can better respond to local variances in demand and product differentiation within each area while still taking advantages of the economies of scale that a company of the caliber of Avery Dennison has been able to create.

I have identified Chile as a country in which Avery can invest its resources and secure expansion in a business environment with minimal risks and optimistic outlook. Chile is a country with strong projections for industrial growth, well-established governmental institutions and a promising destination for foreign direct investment (FDI). Chile stands as one of the most powerful economies in the region and according to a study by the World Economic Forum (WEF) Chile has the most interconnected web economy in Latin America with outstanding Macroeconomic conditions that continue to place Chile in the top-ranking nations for growth and prosperity.

Avery Dennison can bring its expertise in optimizing industrial identification processes to booming industries in construction, automotive, fleet transportation, retail, education, healthcare, food processing and many other markets in Chile. The establishment of local manufacturing and converting plants may also allow Avery to export and serve markets in the neighboring countries of Ecuador, Bolivia, Peru and Argentina in which demand for specialized labeling, media and identification systems is also growing.

Module 2: Analyzing International Competitors

The diversified nature of Avery Dennison business includes many competitors to each one of its three well-defined divisions in the Pressure-sensitive Materials, Retail Information Services, and Office and Consumer Products areas. I will concentrate in naming those competitors that can offer diversifies products at the same scale and specialization as Avery does:

* Bemis Company, Inc. (NYSE: BMS ): Is a multinational company that manufactures and sells flexible packaging products and pressure sensitive materials in the United States, Canada, Mexico, South America, Europe, and Asia. Bemis operates 81 facilities in 13 countries and employs about 20,400 people worldwide. Bemis posted net sales of $4.8 billion in 2009.

* 3M (NYSE: MMM): A diversified technology company serving customers and communities with innovative products and services. The following business units compete with product lines from Avery: Consumer and Office, Display and Graphics, Industrial and Transportation. 3M posted global sales of $ 23 Billion in 2009. It runs operations in 65 countries with 74,835 employees worldwide and 3M products sold in nearly 200 countries.

* Pitney Bowes (NYSE:PBI): A $5.6 billion company that employs 33,000 worldwide. It competes with Avery in the mailing and labeling system segment. It operates in over 130 countries.

Among the many competitive advantages that Avery can bring to the Chilean market the manufacturer should undertake a strategic imperative focused on quality. Avery can do this by offering its Enterprise Lean Sigma (ELS) approach which empowers Avery's employees to be innovative in finding new ways to solve customer problems, meet their needs and create value through their supply chain. Manufacturers around the world count on Avery's solutions to streamline their identification operations in the areas of branding, logistics, packaging, anti-counterfeiting, data-tags, RFID inventory control management and more. Avery's promise of quality encompasses: reducing product sample response times, enhancing customer service and accelerating the rate of new product introductions. A promise focused on process excellence that has been transmitted throughout all business units and levels of the organization.

Learn more about Avery's Enterprise Lean Sigma Here http://www.youtube.com/watch?v=2gyKxK2Mspc&feature=channel_page

Module 3: Assessing the Economic-Geographic environment:

Chile is located in southern South America, bordering the South Pacific Ocean, between Argentina and Peru. Chile's total land area is 743,812 sq km. The climate varies by latitude being temperate; desert in the north; Mediterranean in the central region; cool and damp in the south. The terrain of the Andean nation is comprised of low coastal mountains to the west; fertile central valley and the rugged longest continental mountain range, the Andes Mountains, to the east. Chile enjoys a strategic location relative to sea lanes between Atlantic and Pacific Oceans (Strait of Magellan, Beagle Channel, Drake Passage). Chile has a developed mining industry concentrated on copper, gold, silver, coal, iron ore, nitrates, precious metals, molybdenum; copper exports alone stand for more than one third of government income. Other major industries that contribute to the Chilean economy include: wood, processed food, seafood and wine. Volcanic and earthquake activity are natural occurrences in Chile and the incidence of such activity may cause setbacks in the economy; However, Chilean authorities are prepared to handle catastrophic situations effectively. They demonstrated so