Korean electronics giant Samsung, has increased its investment in Samsung South Africa by R130 million, following a decision to further strengthen its base for Sub-Saharan operations.
Partly as a result of the major battering taken by the Korean economy in the last eight months, Samsung Korea is concentrating even more strongly on exports and is determined to underpin and increase its strong market position in South Africa.
"The success we have had in building the Samsung brand in South Africa in a very short space of time, has set an example to our subsidiaries throughout the world," says Mr. Jang-Hwan Oh, newly appointed chief executive officer of Samsung South Africa.
"This further investment by Samsung into South Africa, is a vote of confidence not only in our company here, but also in the South African economy as a whole."
In April 1995, Samsung took over local electronics company Etron and has since grown turnover dramatically from R149 million, to well in excess of half a billion Rand, enjoying major market shares in colour TV, VCR and fax as well as rapidly increasing market shares in audio and microwave ovens.
"Our market research indicates that positive opinion towards our products in South Africa, places us on a par or even ahead of other major Asian and European brands competing in this country," says Mr. Oh.
"At the same time, a number of measures have been taken to translate our dominant market share into a more equitable return," he says.
Spearheaded by their recent capital inflow, the major measures currently being implemented are:
- Consolidation of company offices and warehouse
- Reduction of inventory levels
- Increased investment in IT systems
- Focus on core product categories
- Rationalisation of personnel, bringing staffing costs in line with international Samsung standards
"The consumer electronics business generally, has taken a profit battering in South Africa in the past year. However, we feel confident that with our increased capitalisation and the measures we have in place, we can make this an extremely profitable market for our products and an advantageous and strategic base for our operations in the rest of Africa," says Mr. Oh.
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