1. How has Arcelik’s home country location influenced its internationalization strategy ?

Faced with increasing competition in its home market and from major global brands in the export arena, Arcelik embraced change so that it can respond quickly to market requirements for new and innovative products, better value, and enhanced customer service.

To meet its competitor’s acquisition strategy, Arcelik looked to acquire foreign brands as well. The first big success for Arcelik was to establish the Beko brand of white goods and TV sets in the UK at the beginning of 1990s, extended to France, Germany, and Spain. By the late 1990s, the company had set up sales offices in France, Germany and the UK and identified specific strategies to enter each market.

The 2000s saw the flowering of Arcelik’s internationalization strategy, aimed to expand its brand portfolio, market penetration and product mix in Europe. Building on the experience acquired while bidding unsuccessfully for Brandt, Arcelik made major purchases of brands in 2002 – Blomberg (a subsidiary of Brandt) in Germany, Elektra Bregenz and Tirolia in Austria, and Leisure (cookers) and Flavel (appliances and TV sets) in Britain. In 2004 Arcelik acquired the brand name Grundig, after the German firm went bankrupt. In Romania, Arcelik acquired Arctic; it immediately invested to modernize the company’s operations and doubled its productive capacity. Arctic made washing machines and ranges as well as TV sets; it now has 50% domestic market share in refrigerators and exports close to 40% of its output. In June 2005 Arcelik launched the construction of a refrigerator and washing machine greenfield plant in Russia.

Arcelik embraced internet technology as a key weapon in its drive to become a global force. For example, Cisco aided Arcelik’s e-transformation by supplying the underlying networking technology that