History Palliser Furniture Ltd Essay Example

the shipments of the Canadian industry.

Their keys to success also differed, as they believed the factors were:

• quality of raw materials
• quality of showrooms
• product design
• extent of marketing activity
• location
• price.

Expansion Opportunities: Since the Free Trade Agreement (FTA), later referred to as North American Free Trade Agreement (NAFTA), between the U. S. and Canada, a couple of things have happened in the Canadian furniture industry to make both Asia and Mexico attractive expansion possibilities. Exporting from Canada increased dramatically between 1997 and 1998 •Labor intensive industry; workers make CDN$ 16. 83/hour in Canada Palliser in particular felt pressure to lower prices, and decrease its product line, in order to maximize the production efficiency by concentrating on bedroom and living room markets.

Palliser should definitely consider making an immediate investment before any of their competitors. However, that does not necessarily mean that should rule out expansion into China. The quality of Chinese furniture products is continuing to improve, and soon Palliser’s consumers would be purchasing them.

Perhaps Palliser could compete with the Chinese competitors by increasing their leather products, since that is where they have a competitive advantage. They could also enter into joint ventures with Chinese manufacturers for making leather products and other lower cost products for exporting to other markets, such as Europe, Japan, Australia, etc. Mexico appears to be the best investment in the present time, but Palliser should continue to consider China in their mid to long term plans.