Published by:
Harvard Business Publishing
Length: 7 pages
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Abstract
Many Western business people believe that the companies now being formed in the former Soviet Union won''t compete in the West for another 15 to 20 years. But in the raw-materials sector, a competitive threat exists today partly because the economies of the NIS are in such disarray. As a result of huge structural changes such as the radical shrinkage of the Soviet defense industry, vast quantities of nickel, zinc, aluminum, magnesium, potash, and other critical materials are now being sold in the West at fire-sale prices. One company, Reynolds Metals Corp., has decided to establish itself in the NIS as a maker of aluminum consumer goods for NIS markets. It is attempting to divert the flow of aluminum to the West by rebuilding domestic NIS demand--without reestablishing the gigantic Russian defense industries that were previously the main customers.
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Abstract
Many Western business people believe that the companies now being formed in the former Soviet Union won''t compete in the West for another 15 to 20 years. But in the raw-materials sector, a competitive threat exists today partly because the economies of the NIS are in such disarray. As a result of huge structural changes such as the radical shrinkage of the Soviet defense industry, vast quantities of nickel, zinc, aluminum, magnesium, potash, and other critical materials are now being sold in the West at fire-sale prices. One company, Reynolds Metals Corp., has decided to establish itself in the NIS as a maker of aluminum consumer goods for NIS markets. It is attempting to divert the flow of aluminum to the West by rebuilding domestic NIS demand--without reestablishing the gigantic Russian defense industries that were previously the main customers.