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China Doll Essay

739 words - 3 pages

Issues

The main issue of the case is the fact that Jeffrey Cheong is not sure whether to move the HCF operations to China or just manufacturing its own label for the Malaysian and Asean Market. Since he got the letters from KiKi and Houida, he needs to review his strategy quickly as both of the company are their best clients since its inception.

STAGE 2

PART I: Decisions

Key player | Jeffrey Cheong |
No. | Main decision | Decision criteria | Alternatives |
1 | Decide whether to move HCF operations to China or not. | 1. if expand to china, HCF need to either operate their own factory or they can joint venture with Chinese manufacturer2. If they are going to stay in ...view middle of the document...

| Alternative | Decision criteria |
| | Resale Value | Compensation | Cost or Profit | |
1 | close down factory in Chieng Mai and Jitra | Both factory have low resale value as they are located in rural areas and hard to sell them | May require cost since many of its employees had specialised skills and difficult to seek employment elsewhere- lose human capital | High cost of pulling down | |
2 | produce their own label | No resale value as they only need to improve the current Malaysian factories | No compensation incurred as they don’t need to retrench their employees | Required high cost since it’s very hard to survive in producing own label | |
3 | outsourcing to reduce cost | No resale value involve | No compensation incurred | Additional fees being imposed | |

Preferred alternative & predicted outcomes:
Preferred alternative is to disobey the shredding policy, which applicable to all documents and disclose related facts and evidence of the material misstatement regarding Enronaa’s company and to prepare a modified report of financial statements. Androids may decline the offer of being the auditor in future time and is going to lose Enronaa as its main client. Android is expected to suffer from a huge loss if this alternative is taken....

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