March 27, 2001 in Social Responsibility News

SAMSUNG Electronics Mobile Phones in the Mediterranean Air

Barcelona, Spain - March 27, 2001 -Samsung Electronics is stepping up its efforts to make inroads into the European mobile phone market, a relatively difficult region to penetrate given the strong positions of local makers Nokia and Ericsson. The successful localization of operations at Samsung Electronics Iberia S.A. (SESA), a Spanish subsidiary, has helped to spread the reputation of Samsung mobile phones among discriminating European consumers.

SESA began to mass-produce wireless handsets in January of last year and now has an annual output of 1.5 million units. Two production lines work three shifts a day, turning out a full lineup of GSM phone models. As such, the company can respond immediately to market changes and plays a front line role in Europe.

SESA is following three core strategies for 2001. Sales and marketing efficiency is being enhanced through the establishment of an e-commerce network. Plant productivity is being increased and lead times are being decreased, and support functions are being linked to the production system. Basic processes for localization are also being improved to give the operation a new growth surge.

Samsung Electronics' Spanish subsidiary was established in 1989 and began making VCRs in 1990. Production lines were subsequently added for TV/VCR combination units, mobile phones and DVD players. Sales last year came to 540 million Euros, a 69% increase year on year.
This impressive sales growth is due to several factors. Brand image has been improved significantly since 1997, enabling Samsung to command higher retail prices for its products. SESA has also secured competitiveness by being able to respond quickly to changing markets, and inefficiencies in management have been eliminated.

According to Managing Director Park Jong-won, head of SESA, "Our localization effort has focused on improving processes in our production, sales and support units, and the result has been high customer satisfaction. We now plan to bolster our brand recognition even further so that the notoriously hard-to-please Europeans will seek out and believe in products with the 'made by Samsung' label."

According to Actualidad Economica 2000, the Samsung Electronics brand move up to the second highest in terms of recognition in Spain last year, thanks to a concerted effort to localize and expand marketing.

About Samsung Electronics
Samsung Electronics Co., Ltd., with 2000 sales revenue of US$30 billion is a world leader in the electronics industry. The Korea-based concern has operations in about 50 countries with 54,000 employees worldwide. The company consists of three main business units: Digital Media, Semiconductors and Information & Communications Businesses. For more information, please visit our website http://www.samsungelectronics.com


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