significant portion of the tomorrow’s world GDP. There could be an increase in demand in these countries for Kao products. Downfall of Communism In the 1990, the world saw the downfall of communism. The Soviet Union broke up and China began to open up its economy to the world. New countries such as Slovenia, Ukraine and China are new markets whereby Kao can market its product. Previously under communism it was hard for Kao to penetrate these markets but now that communism has fallen and capitalism is taking over, Kao can capitalise on this opportunity to expand its operation an a global scale. Liberalisation and Free Trade Currently the world is progressing towards free trade. Much of the efforts are being carried out by the World Trade Organisation (WTO). Free Trade would mean less trade barriers among countries. When tariffs and quotas have been removed, Kao Corporation will be able to operate more profitably. E-commerce All around the world, the Internet is gaining popularity. The latest development in the Internet is E-commerce. Many believe that E-commerce will be the future way of the business world. By selling product directly to the consumers through the Internet Kao Corporation can significantly reduce its distribution cost. Changing Age Structure In many countries, the population is said to be getting older. There is a slow down in birth rate but more importantly, Baby Boomers who were born just after the World War II are now ageing. Taking over, as consumers of the future are the Generation Xers. The generation born between 1965 to 1976 and are poised to have a big impact on the workplace and marketplace of the future. Population Growth in Developing Countries Developing countries like Malaysia is expected to experience population growth over the next few decades. As such increase in population would translate into increase demand for Kao’s products. Potential Environmental Threats Increase Power of Buyer Today, t...
