Taiwanese Golf Equipment Imports from the United States   Term Paper ID:27537 Click to get this paper

Essay Subject: Analyzes the market for imported U.S. golf equipment in Taiwan. Discusses Taiwanese demographics, costs, competition, & distribution.... More...

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Paper Abstract: Analyzes the market for imported U.S. golf equipment in Taiwan. Discusses Taiwanese demographics, costs, competition, & distribution. Paper Introduction: Golf Equipment Imports from the United States Country Market: Statistical Discussion Taiwan comprises 86 islands. The island of Taiwan is 60% mountainous with only one-quarter of the island arable, of which most lies along the west coast. The population at the end of 1995 was estimated at more than 21 million. It is the second most densely populated nation after Bangladesh (Tyson, 1996). Life expectancy at birth in 1990 was 71 years for men and 77 years for women. The birth rate has fallen steadily to 16 per 1,000 in 1993 from 35 per 1,000 in the 1960s. The death rate fell steadily in the 1950s and 1960s and more slowly afterward. At the end of 1992, 25.8% of the population was under 15 years of age and 6.8% was over the age of 65, so that 32.6% of the Text of the Paper: The entire text of the paper is shown below. However, the text is somewhat scrambled. We want to give you as much information as we possibly can about our papers and essays, but we cannot give them away for free. In the text below you will find that while disordered, many of the phrases are essentially intact. From this text you will be able to get a solid sense of the writing style, the concepts addressed, and the sources used in the research paper. Capital inflowscombined with current-account surpluses resulted in the large build-up offoreign exchange reserves, which reached $87 billion at the end of May 1994(Economist Intelligence Unit, 1994). Until 1988 Taiwan's trade and current-account surpluses had risen eachyear since 1986, peaking respectively at $2 .3 billion and $18 billion in1987. In 1994, the total sporting goods market in Taiwan was USD 74 millionwith 4 % of that supplied by imports (Heng, 1995). It is also estimated that new inductees to the game are likelyto increase by 1 percent per year. This fitness trend is attracting more and more middle income peopleto the sport of golf (Wei, 1995). He or she must besensitive to cost considerations among the new middle-income players whoinitially may not opt for the most technically-advanced equipment but aregood potential customers for the future. For years exports haveaccounted for a lion's share of local production. In addition theU.S. Golf equipment isdistributed through outlets such as golf speciality stores (92) percent,sporting goods stores (2 percent) department stores (2 percent),hypermarkets (2 percent), and golf course pro-shops (2 percent).Financing Importers are usually responsible for arranging their own financing.Most accounts for payments are settled by bank-to-bank Letters of Credit.The most common payment term is 8 /2 . Because the country is highly dependent on importsof raw materials, especially energy, it is vulnerable to external priceshocks. Far Eastern Economic Review,37-43. Even though local golf players would acknowledge the quality oflocally made golf clubs to be compatible to imported golf equipment, theystill seem to prefer to purchase imports. (1996 July 1). tournaments through TVand golf magazines. Taiwan's economy is dominated by foreign tradeon the demand side and manufacturing on the supply side. A U.S. Department of Commerce. 1 Taiwan firms areengaged in manufacturing golf equipment--divided between 3 shaft and 7 golf head manufacturers. Taiwan imports ofgolf equipment totaled USD 46.9 million which was 51% of the Taiwan golfequipment market. Imported golf clubs and balls face duties and other taxes, including aharbor tax ( .5 percent), import duties (for golf clubs and balls, (5percent of the CIF value), and value added taxes (5%) (Wei, 1995).Promotion As local end-users believe imported golf equipment is better designedand of higher quality than locally-made equipment, local agents should beaware of the importance of promoting a reputable "brand" image, which maybe the key to successful marketing. Golf Digest and Golf Magazine are popular in Taiwan(Wei, 1995). Reasons for these preferencesappear to be two-fold: first, as living standards improve people can affordto indulge; secondly, local golfers equate the quality and material offoreign-made golf clubs with high performance and product safety. Taiwan reportedly has had virtually full employment for overa decade with most of the labor force concentrated in manufacturing.Taiwan, during the past ten years, has also meet with considerable successin battling inflation. Participants new to the sportgenerally purchase locally-made golf clubs which range in cost from USD 2 to USD 8 per set. As the number of female players isincreasing steadily, local distributors and retail outfits are respondingto their needs by stocking new lines of ladies' equipment and apparel (Wei,1995). It is estimated that there are 55 , golf enthusiasts in Taiwan, 15percent of whom are women. The population at the end of 1995 was estimated at more than21 million. (1996 October 1 ). Lifestyles. The climate in Taiwan has been described as sub-tropical. Vittachi, N. Hottestmonths are in July with the coldest month in February. As a set of inexpensive locally-made golf clubs have a life span ofless than one year, the novice turned intermediate golfer would purchase anew set of golf clubs after one year (Wei, 1995). The sport of golf has become an increasinglypopular leisure activity and is attracting greater numbers of young andmiddle-income people (Vittachi, 1996). This would include golf clubs and golf clubswith stainless shafts as well as carbon shafts. It is the second most densely populated nation afterBangladesh (Tyson, 1996). This group constitutes about .5 percent of thepopulation. Exports accountedfor 45.2% of current price GDP in 1993 while imports were 43.5%. 38% of households were in the highest quintile, 22% inthe next highest quintile, 17.5% in the next highest, 13.25% in the secondlowest, and 7.76% in the lowest quintile (Taiwan Statistical Data Book,1994). The sporting goods market in Singapore. Generally, Japanese golf equipment isconsidered to be of advanced design, good quality, and fine workmanship.Furthermore, the similarity in physical build between the people of Taiwanand Japan appears to give the Japanese an advantage in manufacturing design(Wei, 1995).Product Room for growth exists for U.S. Advertising should be placed in sportsand golf magazines. Taiwan golfers learn about U.S. (1994). Such growth is primarily attributed to rising per capita GNP and theincreasing number of golfers and golf courses. As new people to the sport are increasing by about 1 percent per year, there is room for sales growth of locally made golfshafts. Taiwan: Country Profile. A goal of a 2% market share after a period of 3- 5 years would seemreasonable.Summary/Recommendation Overall, Taiwan consumers seem to prefer to purchase imported golfequipment. Market ResearchReports. Themajor supplier of golf clubs were Callaway, which enjoyed 15 percent of theTaiwan market, Spalding (6 percent), Wilson (3 percent), and Cobra (2-5percent. By 1993 the trade surplus had shrunk to US$11.4 billion and thecurrent-account surplus to $6.2 billion.Until 1984, when it prepaid some of its external medium- and long-termdebt, Taiwan also had positive long-term capital flows. made golf clubs ranged from USD 4 to USD 2, . GNP per capita is estimated $12,439 in 1995 (Tyson, 1996). Life expectancy at birth in 199 was 71 years for men and 77 years forwomen. The game is considered as much a tool of diplomacy and negotiationfor government and marketing leaders as a form of recreation. High performancegolf equipment with advanced design features seem to represent the bestsales prospects in Taiwan. Tyson, L. U.S. Recently Taiwan has been attempting to expand its tradewith mainland China which in 1992 was estimated at 7.5% of total trade.Taiwan's government is also attempting to cut its deficit on trade withJapan, which by far remains the largest source of imports (EconomistIntelligence Unit, 1994). There are also individual small showsheld by firms which might serve as useful vehicles to generate greaterbrand awareness.Distribution A Foreign manufacturer or importer should hire local agents ordistributors to represent them in the Taiwan market. increased 78.4% fromthe pervious year to USD 13.2 million. The ratio ofdependents to people of working age at the end on 1992 was 48.3%, what hadsteadily fallen from 94% in 1962 (Taiwan Statistical Data Book, 1994). Bowling equipmentranked at the top with golf equipment ranked second. Taiwan statistical data book. In 1995 domestic production of golfing equipment is expected toincrease from USD 51 .4 million to USD 517 million. Taipie: Council for EconomicPlanning and Development. The major local producers selling their products in Taiwan areMitsusiba, Osprey, Dynacast, and Prokennex. based importer offering high performance golf equipment withsome advanced design features should do quite well. Department of Commerce. Japanesegolf clubs ranged from a price of USD 6 to USD 2, . The U.S. This historical association helps account for the ready acceptanceof Japanese brand golf products. Despite attempts to diversify into Europe, Japan and even EasternEurope and Russia, Taiwan's export market remains heavily dependent on theUS which took 27.6% of exports by value in 1993 and accounted for 85.5% ofthe trade surplus. Foreignmanufacturers supplied about 48.8 percent of these sales. In 1993 8.7 million civilians were employed, representing 98.5% of thelabor force. Generally, when it comes time to purchase a new set of golfclubs, golfers will tend to buy foreign made equipment. FinancialTimes, 11-12. There are also a number of "noname brands" with low prices in the country. Imports of sporting goods from the U.S. Washington, D.C.: U.S. Nearlyall exports are manufactures and the manufacturing sector accounted for31.6% of GDP in 1993. Taiwan's consumers arepaying greater attention to health and fitness, which is leading toincreased outdoor activity. The birth rate has fallen steadily to 16 per 1, in 1993 from 35per 1, in the 196 s. Popular Japanese brands of golf clubs were Mizuno (15-2 percent), Honma (16-2 percent), Maruman (5-6 percent), and Daiwa (3-5percent) (Wei, 1995). Since the198 s, as living standards rise, health and fitness are more and more thetrend. In 1991the distribution of total personal income in Taiwan was divided into 5separate quintiles. Sales prices for aset of U.S. Product quality and brandimage are important.Price Those golf participants who are new to the sport generally purchaselocally-made golf clubs at USD 2 to USD 8 per set. The Japanese introduced the sport of golf to Taiwan while the islandwas under Japanese rule. Private enterprises have increased their share ofindustry so that in 1992, 82% of total industrial production originatedfrom the private sector with small and medium-sized firms dominatingindustry (Economist Intelligence Unit, 1994). The death rate fell steadily in the 195 s and196 s and more slowly afterward. After the oil price started to fallTaiwan had minimum inflation in either consumer or wholesale prices(Economist Intelligence Unit, 1994).The Target Market As incomes rises in Taiwan, so does the desire to take part in leisureactivities and improve one's quality of life. reached USD165.9 million or 56% of the import market in 1994. The driest month isNovember and the month with most rain is August (Economist IntelligenceUnit, 1994).Economic Statistics and Activity The total GNP in Taiwan in 1995 was $263.6 billion with GNP per capitaat $12,439 (Tyson, 1996). The Economist Intelligence Unit.United Kingdom. exports in a range of areas, includinggolf clubs, balls and personalized equipment (i.e. A new generation comes to fore. In 1994 imports of golf equipment from the U.S. In the 197 s those in the upper-income bracket began to playgolf. Golf Equipment Imports from the United StatesCountry Market: Statistical Discussion Taiwan comprises 86 islands. (1994). areexpected to reach USD 18.1 million up 37 percent over 1994. golfequipment suppliers have enjoyed brisk sales in the Taiwan market. Consequently inflation has been highest in those years withsubstantial oil price increases. Sponsoring golf tournaments, organizingdemonstrations and classes by American pro golfers coupled with acommercial advertising campaigns could also help to promote sales and builda product's reputation and image. Japan was theleading supplier of the import market with 5 .3 percent of 1994 imports.The U.S. In 1994 imports of golf equipment increased 29.6 percent. Bibliography Heng, S. About 7 percent of golf head manufacturers haveset up branch facilities in mainland China to ensure low cost production(Wei, 1995). At the end of 1992, 25.8% of thepopulation was under 15 years of age and 6.8% was over the age of 65, sothat 32.6% of the population was of a dependant age. are impressed with facilities andamenities offered at U.S. supplied 28 percent of imported golf equipment(Wei, 1995) Sales of golf equipment jumped from USD 86.4 million in 1993 to USD96.2 million in 1994 and was expected to expand to USD 1 9.4 million in1995. Taiwan: Golf equipment. (1994 July). A U.S. was the second largest supplier, with an import share of 28.1%.Other minor foreign suppliers include mainland China and Hong Kong (Wei,1995). The United States ledthe import market for sporting goods for the past two years followed byJapan and Germany. importer could further enhanceits market share by participating in promotional activities with otherlocal agents and distributors. (1995 August). The outlook forforeign-made items continues to appear bright, as imported products aregenerally perceived to be superior to domestic brands. is the most popular destination for Taiwan tourists and Taiwan golfenthusiasts who travel to the U.S. Washington D.C.: U.S. In 1914 the Japanese built Taiwan's first golfcourse. In 1995 imports from the U.S. Golf equipment is also exhibited at general sporting goods shows. The island of Taiwan is 6 % mountainouswith only one-quarter of the island arable, of which most lies along thewest coast. Wei, J. Domestic manufacturersprimarily cater to markets in Japan and the U.S. golf courses, and are further attracted to U.S.golf equipment and products. Themost important is the Taipei International Sporting Goods Show which isheld annually in April (Wei, 1995). During the 195 s and 196 s the sport of golf was reserved for highranking officials, military officers, foreign embassy people and the verywealthy. bags caps embossed withcompany logos or personal names as well as golf apparel. MarketResearch Reports. If this paper is not what you are looking for, you can search again: Search for: or Click here to request an essay written just for you.