A-1 lanes, a manufacturer of bowling lanes, has grown and expanded greatly since its beginning in 1985. The company has dealt with much throughout the years, and it was recently forced to reevaluate based on the economy in its overseas countries, particularly the baht being devalued by 11% in 1997. During this reevaluation, A-1 must look at many important aspects of the company in order to make the correct move towards the future. They need to look at the external and internal environment to discover what potential and options that they have. The business-level strategy also needs to be assessed and possibly restructured. Lastly, being mainly in the Asian market, they need to discover the risks and the proactive measures that they can take.
External Environment
The issues that A-1 seemed to be facing during this time were not only affecting them, but many other companies as well. As for A-1 though, 80% of their sales as well as one million dollars in accounts receivables were from Asia. A-1 was able to compete up until this point, but looking into the future, it was impossible to tell what was in store. There are many factors that can be examined in order to propose possible actions that A-1 could take.
The government is possibly one of the largest issues for A-1, as it seems they potentially caused the entire economical issue. They enacted policies that allowed certain banks to make loans in different currencies through the Bangkok International Banking Facilities. This policy caused an issue because interest rates were still high for baht-denominated loans so people would just take out loans in other currencies with a lower interest rate. The economy of Thailand was apparent to be doing well, but underneath it was supported too much by foreign capital. Politically, the government had the interest rates far to high and the banks were unable to maintain the baht’s value so the government had to devalue it.
Obviously the foremost problem that A-1 is dealing...