Global Expansion Strategy: A Case Study of Ashley Furniture Company

This case study analyzes Ashley Furniture Company's potential globalization strategy, focusing on the rationale, target geographic locations (specifically South East Asia and the Sub-Continent), and the decision's impact on overall growth and expansion. It discusses the benefits of globalization for Ashley Furniture, including new market penetration, increased profitability, and efficient resource utilization. The study supports the choice of South East Asia due to lower production costs, growing economies, and readily available resources. It also addresses potential concerns about political instability and offers counterarguments based on economic growth and resource availability. The balance scorecard states about the reputation of the company which is very strong among the customers and also states about the aspects such as the business process that are superior and efficient.

Running head: CASE STUDY QUESTION ANSWER
CASE STUDY QUESTION ANSWER
Name of the Student
Name of the University
Author Note

1CASE STUDY QUESTION ANSWER
Table of Contents
Introduction................................................................................................................................2
1. Is globalization a good move for the company?................................................................2
2. What is your rationale behind this decision?.....................................................................3
3. What geographic location should be a target for global expansion?.................................3
4. What background information can you provide to support this decision?.........................4
5. How will this decision support the overall goal of growth and expansion?......................5
6. How would you refute someone with the opposing perspective?......................................5
Conclusion..................................................................................................................................6
References..................................................................................................................................7
Appendix....................................................................................................................................8

2CASE STUDY QUESTION ANSWER
Introduction
Ashley Furniture Company is a reputed furniture company in the US. They are
associated with the manufacturing and retailing of the furniture. The company is associated
with providing the goods with the quality and also engaged in customer support for their
furniture. This study incorporates the aspects of the analyzing the past and answers the
questions that are related to the growth of the company.
1. Is globalization a good move for the company?
Globalization is a major factor that have contributed to the expansion of any
organization. This has been one of the key attributes for the organizations that are involved in
the process of increasing the profitability. Globalization can be a good step for the company
in order to expand to the various market and it is a major factor that will be liable for the
contribution to the development of the aspect that are related to the growth of the
organization (Hanson et al., 2016). Globalization can be a feasible if the attributes such as
increasing the cash inflow of the company. This has been a key factors that can contribute to
growth of the organization. Other than cash inflow there has been significant aspects that are
associated with the globalization is the new market penetration (Cramer, 2017). Ashley
Furniture Company being one of the reputed company, globalization can be a good step
towards reaching the new customer base and increase the profitability of the company.
Another significance of the globalization is that it can help the company to reach the new
markets that will be impacting the profitability of the company. There is another significance
of the globalization is that it is involved in the process of developing the new market which
helps to get the attention of the new customers. Globalization can help Ashley Furniture in
increasing the trade at the international level. The globalization can also help the company in
providing them with efficient resources that can help the company to grow.

3CASE STUDY QUESTION ANSWER
2. What is your rationale behind this decision?
Ashley Furniture is one of the most competitive company in the US furniture market.
They have all the resources that will be required for the globalization of the company such as
strong financial resources, human resources and technological advancements. The step of
globalization can impact their growth positively. Their positive approach with the
development of the factors that will be liable for the development of the factors that will be
liable for the growth of the company. Their major strength is the affordability which can
attract the new customer which is one of the strategic consideration. The cultural
considerations will be liable for the development of the areas that will be impacting product
mix. However, this can be adopted by the company as there have been significant aspects that
will be liable for the expansion of the company in a global stage. The balance scorecard states
about the reputation of the company which is very strong among the customers. It is has also
stated about the strong financials and the internal process of the company. This is one of the
major factor that have contributed to the development of the path that can help the
globalization of the company. The balance scorecard also states about the aspects such as the
business process that are superior and efficient.
3. What geographic location should be a target for global expansion?
Geographic locations are major factor that contributes to the development of the
factors such as competitive advantage and also helps the organization in terms of knowing the
availability of the resources. This is one of the most significant aspect that contributes to the
development of organizational growth and help in determining the future of the company in
the market. The geographic location that the company can choose to enter is the South East
Asia and the Sub-Continent. This is a resourceful location. This is one of the major locations
where the production cost is lower compared to other areas in the world (Brown, 2016).
However, there are challenges such as the political instability in the subcontinent. Still south-

4CASE STUDY QUESTION ANSWER
east Asian province is one of the most influential geographic location that can serve all the
required resources such as financial, human and materials. The culture of the geographic
location also incorporates furniture that will be helpful for the growth of the organization.
This geographic location can help the organization to incorporate cultural values and the
sustainability of the organization (Burton & Wurfel, 2016). Globalization in this area is a
beneficial aspect that will be liable for the development of the organization. Countries such as
India, Bangladesh and China can be a significantly efficient production hub for the company
with their numerous resources. The company can also enjoy the diverse culture of the
province and incorporate such culture in their products.
4. What background information can you provide to support this decision?
The decision for choosing the South East Asian province has a significant impact on
the production of the company (Chow, 2017). The financial status is a major contributor
towards the selection of the province. With growing economies such as India, Bangladesh it
can be one of the most significant choice for the globalization (Asher & Novosad, 2017). The
production cost of these province is also competitive as the growth in the population is
significantly high. The growth of the population can also impact the organization in a positive
way. This can enable the organization to have a big customer base that will be beneficial for
the organization who are already a reputed brand in the furniture industry. The income level
of the consumers will be also helpful for the organization as pricing of Ashley Furniture is
very competitive. An important part for the organization is to incorporate the diverse culture
which will be beneficial for the organization in terms of developing the product. This is a
major contributor in terms of developing the key areas that will be responsible for the
organizational growth.

5CASE STUDY QUESTION ANSWER
5. How will this decision support the overall goal of growth and
expansion?
The primary goal of globalization is one of the significant aspect that will be liable for
the increase in the profits of the company. The decision of adapting the globalization as a
strategy to expansion is the most profitable factor that will be contributing to the profitability
of the organization. The decision of the choosing the south Asian province for the
globalization can impact the organization in minimizing the costs that are related to the
production of the company. The inexpensive resource can help the organization will be
helpful for the minimization of the cost and help the company to increase the profitability.
This is one of the major contributor towards the developing the market and creating a
perception among the consumers. The key strengths of Ashley Furniture can be utilized in
full. The key areas that will be impacting the company by expanding to these areas will
enable the company to achieve their operational goal of providing an exceptional shopping
experience.
6. How would you refute someone with the opposing perspective?
There has to be doubts about the decision to expand to the global market and
specifically expand to the Asian province despite being a politically instable area for decades.
The areas of doubts can be cleared in a below stated form:
 Growing Economies: These areas are one of the most growing economies in the world.
This is a key benefits for the company. The growth in the economy is an important part
for the company that will be helpful for the development of the factors related to the
organizational growth. The growth of the economies will be helpful for the organization.
 Resources: Sub-continent is one of the most resourceful area in the world. The key
resources that are required for the growth of the organization are readily available along

6CASE STUDY QUESTION ANSWER
with the minimized cost (Agnihotri, 2015). Skilled human and inexpensive capital is one
of the major contributor to that. These resources can help the company to have a
competitive advantage against the other brands such as IKEA.
 Technological Resources: China is also known for its resources. The technological
advancement are most positive attribute that will be liable for the growth of the
organization. The technological advancements can also impact the organization in
minimizing the costs that are associated with the production.
Conclusion
To summarize the study it can be stated that it is important for the organization to
incorporate the globalization. However, there are challenges associated with it. Thus, it
becomes important to assess the key areas. From the study it has been found that choosing the
South East Asia is going to benefit the company in terms of globalization.

7CASE STUDY QUESTION ANSWER
References
Agnihotri, A. (2015). Low-cost innovation in emerging markets. Journal of Strategic
Marketing, 23(5), 399-411.
Asher, S., & Novosad, P. (2017). Politics and local economic growth: Evidence from
india. American Economic Journal: Applied Economics, 9(1), 229-73.
ashleyfurniture. (2019). about-us. Retrieved from ashleyfurniture:
https://www.ashleyfurniture.com/about-us/
Ashleyfurniturehomestories. (2019). our-mission-vision-and-values. Retrieved from
ashleyfurniturehomestories: https://ashleyfurniturehomestories.com/our-mission-vision-
and-values/
Brown, R. A. (2016). Capital and entrepreneurship in South-east Asia. Springer.
Burton, B., & Wurfel, D. (Eds.). (2016). Southeast Asia in the new world order: the
political economy of a dynamic region. Springer.
Chow, G. C. (2017). Capital formation and economic growth in China (pp. 1186-1221).
BRILL.
Cramer, J. (2017). Corporate Social Responsibility and Globalisation: an action plan for
business. Routledge.
Hanson, D., Hitt, M. A., Ireland, R. D., & Hoskisson, R. E. (2016). Strategic
management: Competitiveness and globalisation. Cengage AU.

8CASE STUDY QUESTION ANSWER
Appendix
Ashley Furniture company balance scorecard
Objectives Measures Targets Initiatives
Financial  Increase in the
Cash Inflows
 Decrease the
production cost
 Revenue
 Production
Cost
10%-30%
increase in
profits
 Application
of Cost
Accounting
Customer  New Customer
Base
 Increased
Sales Figures
5%
increase
 Marketing
Activities
Business
process
 Better production
quality
 New Production
Hubs
 Assessment
of the
Process
7%-10%
increase
 Implementin
g Supply-
Chain
Management
Learning
and
growth
 Globalization of
the Business
 Incorporating
New Culture
 Dynamic
Organizational
Behavior
 Business
Growth
 Employee
Productivity
 Ability to
adapt to
change
7%,
13%, and
17%
 Strategizing
and
implementin
g the plan
for
globalization
 Training and
development
initiatives
 Incorporate
the changes
in the
organization