He narrowed the horizontal scope of business (the lines of products and services) to focus on broadening geographic scope. Strong commitment to safety, with a zero4life mindset, investing in and implementing a formal, measurable safety program. CEMEX, by far the most profitable of the multinationals in the cement industry, seemed like the ideal case to study to understand this anomaly. We are always looking ahead and constantly innovating. At CEMEX, we recognize that fostering innovation alongside our suppliers, is fundamental. SCA&C (South and Central America & the Caribbean). By expanding, CEMEX benefitted from economies of scale as well. It also explains the ways in which the leaders of CEMEX are planning to use its distinctive capabilities to build an increasingly distinctive company. Supply-Side Economies of Scale . New entrants are less likely to enter a dynamic industry where the established players such as CEMEX, S.A.B. What comes next will depend on how well they face up to them. Cement is generally considered a commodity business, but Cemex has focused hard on differentiating itself. The minimum efficient scale in the cement industry is approximated around 1 million tons of capacity per year. This case study is primarily useful for analysing the costs associated with globalisation and debating over the possible alternatives for a company caught in financial troubles after committing significant amount of debt on global expansion. The minimum efficient scale in the cement industry is approximated around 1 million tons of capacity per year. The item has been saved. But given the company’s high market share there, the expansion possibilities within Mexico are clearly limited. Mexico, like many other developing economies, still hadn’t generated much outbound foreign direct investment (FDI). CEMEX acquired companies to grow rapidly, took advantage of economies of scale, and used the Internet to lower its cost structure. In CEMEX’s view this means that geographic markets can be larger than the 30 mile radius typically adopted in previous decisions. The main strategy of companies, especially CEMEX is the merger and acquisition of companies and plants as expansion mechanism and in turn as a means to strengthen its presence which generated economies of scale. Perhaps most crucial to its international expansion success was foreseeing the shifts in distribution technologies that would … Outstanding performance in the introduction of new products or services to meet CEMEX's current and future business needs. Equally, there are times when an acquired company has management or production techniques of its own that can be … Use a replicable set of standard policies, processes and tools for our supply planning, negotiation, purchasing and inventory management functions. And the bulk of its investment was concentrated in the United States — the destination for more than 80 percent of Mexican exports. CEMEX, unlike its top competitors, was also an early example of a multinational from an emerging market. The minimum efficient scale in the cement industry is approximated around 1 million tons of capacity per year. One remarkable illustration of this work ethic is CEMEX’s noteworthy success with postmerger integration (PMI). ... in the existing and new market and develop the sustainability plan on the economies of scale. Over the years, CEMEX’s management has demonstrated continuous commitment to its identity as a high-value, knowledge-intensive solutions provider, even as it shifted to meet changing market demands and conditions. Zambrano deliberately sought to have the entire enterprise create value. CASE STUDY CEMEX (A):BUILDING A GLOBAL LATINA MASTER IN BUSINESS ADMINISTRATION 2014 MANAGERIAL FINANCE (FIN 745) ANALYZING CASE STUDY CEMEX (A) : BUILDING A GLOBAL LATINA Prepared by: FARAH NADIAH IBRAHIM 2013812912 Prepared for: DR NIK NAZIMAN pg. Cross border activities will add value to an industry like Cement on following grounds:- Economies of Scale: - Given the access to local supplies, local markets and increased MES as a result of global expansion CEMEX and its competitors have been able to … The Supplier of the Year Award is the most distinguished award for the supplier with outstanding results in more than one category mentioned above. We invite our suppliers to participate in the open ideation challenges implemented in our several business units: Economic/Cost Drivers Nature of the industry – The fragmented nature of this industry explains the inherent appeal to globalize. Many companies expand into areas where they are unlikely to thrive, because they lack the capabilities needed in their new locales and because the parameters of their home country constrain them. There definitely is a “CEMEX Way.” The senior leaders of the company dedicate themselves to fostering and maintaining the CEMEX culture. By expanding, CEMEX benefitted from economies of scale as well.