"ASI" LTD case study.

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                                                                           Prof. Tsaliki Persefoni, Dr

B U S I N E S S    E C O N O M I C S

Course Assignment

“ASI” LTD

                                                

CONTENT

  1. Abstract
  2. Description of the company – “ASI” LTD
  1. History
  2. Activities
  3. Structure
  1. Microeconomic Analysis

3.1 Description of the media and advertising market

3.2 Description of the construction industry

3.3 Direct and indirect competition

        3.4 Pricing and distribution policy

        3.5 PR and advertising

  1. Macroeconomics
  1. 4.1The macroeconomic environment in Bulgaria

           4.2.What is the cost of making legal business in Bulgaria?

  1. Competitive strategy for “ASI” Ltd.

5.1 SWOT Analysis

5.2 Setting short term and Long term objectives

5.3 Proposing ways for implementation

  1. Attachments
  2. References

ABSTRACT

“ASI” Ltd. is a privately owned company that publishes a newspaper for construction and architecture, a business style magazine and consults construction trade companies in their PR and marketing strategies.

As following the positive trends in the macroeconomic indicators and the development of the construction business, it becomes obvious that there is a room for enlargement of the business of “ASI” Ltd.  The bases for the development of the company as well as the concrete objectives that stay in front of the company as well as the steps in the implementation process are subject of the following  paper.

The following analysis is made mostly on the bases of official data cited with referred sources. Exact data however about the size of the advertising market in Bulgaria is not available. There is data for the press market and TV market only, however the specialised publications /as the newspaper published by “ASI” Ltd./  are not included in the monitoring of the press market.

Bulgarian market economy is in its teenage years. Bulgarian managers most often are self -educating themselves on the principle of the “probe and the mistake”. In the process of the European integration Bulgaria is relying on the Western know-how. Information is of value. Thus the information and consulting business in Bulgaria has its future. If it learns how to benefit from the opportunities.

Business Economics

Course Assignment

Part 1

Description of the company – “ASI” LTD

History:

The company “ASI” Ltd. has been found in November 1997. It is a fully privately owned enterprise. Two partners, share the ownership as each of them possess 50 % of the firm. The first headquarter of the firm was in Plovdiv, which is the second biggest town in Bulgaria after the capital Sofia. Soon after the start of its activities the company opened corresponding offices and advertising bureaus in Varna, Bourgas, Rousse, Pleven, and a headquarter in Sofia.

Activities:

The main activity of the company was to publish a national weekly specialised newspaper for construction, architecture and investments, called “Construction & City” The subject of business came from the background of the owners, one of which was a construction entrepreneur, and the other editor in chief of other publication. The two of them combines their knowledge and experience and started their business, which developed and became successful.

“Construction & City” weekly is a specialised national newspaper about construction, architecture and investment. It is published every Monday on 32 or 40 A3 format colour pages in circulation of 8 000 copies 4000 of which go to subscribers. The edition works in close co-operation with the Minister of Regional Development and Public Works and all its institutes and structures, with the Union of Bulgarian Architects, Bulgarian Building and Construction Chamber and the professional building organisations at central and regional level.

The audience of the newspaper is highly specialised, including: manufacturers, dealers and tradesmen of building materials and products applicable through the whole construction process, construction specialists – architects, designers, civil engineers, building companies, state, municipal and public bodies in the sector – the State Directorate for Building Control and its regional inspectorates, Architectural and Town Planning authorities, etc.

The topics that the publication cover are: normative documents in the construction sector; hot issues of Bulgarian towns development; covering of all national and regional specialised construction and architecture fairs, exhibitions, presentations, seminars, etc.; infrastructural problems, public projects, cadastre, city planning and more; architecture – a specialised section and “Architecture News” monthly supplement – designs, projects, professional issues; direct offers of materials and prices from manufacturers, distributors and wholesalers as well as up-to-date information about prices of main building materials in the cities Sofia, Plovdiv, Varna, Bourgas, Rousse and Pleven.

Some of the biggest advertisers and most loyal partners of the publication are: Knauf Bulgaria EOOD, Ytong Bulgaria EOOD, Rigips Bulgaria EOOD, Onduline SM EOOD, Alumil Bulgaria EOOD, Team Co Ltd., representing Borner in Bulgaria, Fibran Bulgaria, Schneider Electric Bulgaria EOOD, Hilti Bulgaria EOOD, Kirov EOOD, representative of Bosh for Bulgaria Yvel Iv Ltd. represenative of Henkel Ceresit for Bulgaria and many others. /Construction & City weekly, 1998-2001/

The second and very young product of the company is the luxury magazine “Business Style” which the company started to issue in March 2001, the magazine is published once in two months and  is not for sale, it goes as a direct mail to all the subscribers of “Construction & City” newspaper. The sixth issue of the magazine is in the process of production. The magazine is created especially for the loyal readers – the subscribers of the newspaper, who receive it for free. The magazine covers management and marketing information, life style interviews with interesting people in the construction and architecture spheres, presentation of interior designs, as well as latest news in automobile industry, fashion, luxury accessories, alcoholic beverages, health care and travel – offers for business travel and vacations. At the beginning the magazine has been subsided 100 % from the newspaper however, the attractive audience – 4 000 well off businessmen and companies gathered substantial number of advertisers into the magazine so the goal now is the magazine to become self financing.

The third activity of the company is actually not a product rather a service – it is the PR consulting  business that “ASI” Ltd. started to develop in 2001. This activity includes organisation of architectural saloons and exhibitions, seminars and discussions on hot issues in the construction industry. “ASI” Ltd. provides also assistance to newcomers in the industry to established trade companies and representative offices that plan to launch a new product or construction technology. The company as publisher of the specialised newspaper possess a lot of relevant information in the sphere. The information is being gathered and structured, so it can be used later on for marketing researches and analysis of the industry. The data base that the company possess is also very valuable resource which can be provided with a price to companies that are interested. The most simple example can be given with the data base with contacts of architects that can be provided to trade companies which to contact by direct mail the architects and offer them their products, because first the architect and then the investor decide on the materials with which certain building will be constructed.            

Structure:

See Attachment 1

There is no separate department for the PR and consulting activities for the moment. The PR and consulting endeavours  are performed by the Marketing Department of the company. If this activity is successful in the future, the need for enlargement of the team will be inevitable. It is a question of strategic human resource planning.  

Part 2

Microeconomic Analysis

  1. Media and Advertising market in Bulgaria

After 10th of November 1989 when the communist regime fell the media market in Bulgaria passed through dramatic development. During the totalitarian regime there was one national television BNT/Bulgarian National Television/with two channels – Channal 1 and Efir 2, one national radio – BNR with two national stations – Horizont and Hristo Botev as well as regional programs in the biggest towns in the country. The newspaper with the highest circulation was the newspaper of the Communist Party – “Rabotnicheski delo”, all the members of the party have been obliged to subscribe to the edition. There have been several other publications – national and local, however all of them have been censored and manipulated by the ruling party. The situation changed dramatically in the years after 1989. In 1996 for example there have been 920 newspapers and 722 magazines, after this boom there was certain tendency for closing of newspapers and magazines mostly because of lack of finances but even in the end of  2000 there are over 600 newspapers and 500 magazines on the market./data provided by the Statistical Yearbook of National Statistical Institute 2000, pg.40./

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Who are the big players on the Bulgarian press market at the moment? Here it is better to raise the question in Singular. The answer unconditionally is  Westdeutche Algemaine Zaitung or WAZ – the German media group which possess the two most read daily newspapers in Bulgaria – “24 Hours” and “Trud”.  The WAZ publications possess at about 50% of the advertising press market./50% of the advertisements in the press for 2001 is in their newspapers. The size of the advertising market for the press for the year 2001 in Bulgaria equals 77 216 760 DM. The increase from the ...

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