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On December 1, 2017, TomWriter88 commented on Exporting Entertainment: Can CJ E&M Rely on the Chinese Market? :

A fascinating and well-written piece, thank you.

CJ E&M may have hope now that President Jae-in Moon is endeavoring to normalize relations with China. However, I agree that they must act to protect themselves against political risk while aggressively pursuing international expansion. Like Toby Johnson, I believe the Chinese market is too large to forgo, and CJ E&M possesses the significant advantage of knowing the Chinese audience’s tastes and behaviors. For these reasons, they should try to expand again in China.

That said, they do need risk diversification. Governments always value employment and increased economic opportunities for their citizens. CJ E&M could link themselves to Chinese companies in such a way that communicates clearly how they are enriching the Chinese economy. Select joint ventures and partnerships with media companies, producers, and platforms could be worth exploring. If the benefits of CJ E&M exceed the costs (political and economic), the government will be more inclined to allowing them to stay in operation.

On December 1, 2017, TomWriter88 commented on Enjoy that cup of coffee, it may be your last… :

Without coffee, this comment would not have been typed, so this topic is near and dear.

I completely agree with your assessment that Nestle should focus on production: improving yields and reducing waste. While helping their suppliers improve sustainability and yields is noble and likely effective, Nestle must also put its money where its mouth is and demonstrate to its suppliers that it is similarly investing in sustainability and yield improvement.

Longer-term, perhaps Nestle could look to consumer education and new product development. The coffee industry experienced its second year of supply deficit in 2015/2016 [1]. Therefore, coffee drinkers must be educated to reduce usage waste. Every drop counts. Additionally, Nestle could explore new products that require fewer beans for an equally strong coffee. Nestle would never want to sell less coffee or lessen demand, but they could reduce the raw materials necessary to make each beverage.

[1] International Coffee Organization, October 2016. Accessed November 2017.

On December 1, 2017, TomWriter88 commented on Escaping to Tasmania :

As Clare and Francesca mention, most wineries do not have the luxury of relocating in the face of climate change. This is simply not a trend they can outrun. Additionally, region is so closely associated with the wine’s reputation that most well-known vineyards do not have the ability to move without impairing their reputations.

You mention shifting grape varietals to grow grapes that grow in warmer weather. A risk there is that wineries become known for wines that require certain grapes. Abandoning a “famous” wine could irreparably damage sales. However, I wonder if shifting product mix could be a near-term solution, before Isabel’s longer-term R&D suggestion. If climate change has caused red grapes to ripen earlier so they now compete for the white grapes’ space in steel fermenters, could wineries shift their mix of red vs white to alleviate space pressures? While the simple solution is buying more fermenters, that would require substantial investment and decrease utilization. A more cost-efficient solution would be to shift the product mix in the short-term, abandoning wines with subpar sales to give room to the ones that sell well. A long-term solution would still need to be found for vineyards that cannot relocate, however.

On December 1, 2017, TomWriter88 commented on Trouble Brewing – Beer Imports from South of the Border :

Kudos on this paper, and especially the headings.

This case is wrought with uncertainty on both sides of the border. As Jason raised previously, proactively diversifying production by producing in the U.S. would insulate Constellation from some risk. It does, however, present the risk of bad PR if beer drinkers rebel against an American-made Mexican beer. Although, I wonder how many people know where Corona is made versus simply assuming its Mexican production and heritage.

Perhaps this is a rare instance in which marketing departments can assist in supply chain decisions. A market research study could quantify the importance of Mexican beers being produced in Mexico and the potential consumer reaction to learning it was made in the USA. After all, the worst-case scenario is investing in USA production facilities only to incur backlash and sales declines.

On December 1, 2017, TomWriter88 commented on Caterpillar: Building the Supply Chain of the Future :

In your closing, you mention Caterpillar integrating more closely with its customers. Companies that purchase Caterpillar equipment are likely quite brand loyal. Therefore, tracking a piece of equipment’s usage and efficiency over time could deliver Caterpillar valuable insights into when a customer will need to reorder spare parts and replacement heavy equipment. Essentially, Caterpillar would gain a clearer picture of demand and so be able to more efficiently schedule its production.

On December 1, 2017, TomWriter88 commented on Building the Future at GE, One Layer at a Time :

Fascinating piece, thank you.

Financially, the spare parts business certainly appears to be an attractive, high-margin opportunity. It also aligns well with the promise of additive manufacturing: faster production cycles and lower inventory costs. In capital-intensive industries such as airlines, I would imagine spare parts inventories represent a significant investment – one that 3-D printed parts could hopefully reduce.

However, for GE, I wonder if there is an inherent tension between additive manufacturing capabilities and the need for spare parts. If additive manufacturing reduces the number of parts in an engine from 855 down to 12, as in the ATP Turboprop referenced above, will the spare parts market still be profitable in a few years? Put another way, if GE uses additive manufacturing to reduce the number of parts in an engine, will they need to produce spare parts at all?