CASE STUDY
Megahertz Communications
Submitted To,
Professor Framarz Byramjee,
Pes-IUP.
Submitted By,
Abhilash.Kotte,
@04179163,
Cohort: 17
PES-IUP.
1) What was the motivation for Megahertz’s shift toward strategy of export-led
growth? Why do you think the opportunities for growth might be greater in
foreign markets? Do you think that developing countries are likely to be a
major market opportunity for Megahertz? Why?
Megahertz saw that there was money to be made in foreign markets. The
opportunities were greater because they were able to be a turnkey company.
The need was there. Megahertz has a great chance to do well in developing
countries because there is always a need for broadcasting companies, especially
when the nation is still growing.
2) Does Megahertz’s strategy for building exports make sense given the
nature of the broadcast industry? Why?
Yes, the broadcast industry was booming in the United Kingdom. This cued
Megahertz to looking into foreign markets.
3) Why do you think Megahertz found it difficult to raise the working
capital required to finance its international trade activities? What does
the experience of Megahertz tell you about the problems facing small
firms that wish to export?
The banks did not trust that Megahertz’s clients would be able to pay. Yes, small
firms face the fact that they cannot raise capital on their own and that banks do
not trust them because their customers might not pay them.
4) Megahertz solved its financing problem by selling the company to
AZCAR of Canada. What other solutions might the company have
adopted?
Megahertz could have tried bartering or trading on good for another. They could
have done switch trading which involves a third-party.
5) What is happening today with Megahertz Communications?
Amsterdam, the Netherlands, and September 10, 2010 (IBC 2010, Stand 11.F20):
Megahertz (MHz), an international independent systems integrator, has
appointed Alan Pimm to join its management team. Pimm will support the
growth of MHz’s international business with a particular focus on expanding the
company’s systems integration offering for file-based workflow solutions and
extending its reach into the Asia Pacific market.
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