backtop


Print 25 comment(s) - last by mavricxx.. on Apr 4 at 4:53 PM

Will focus on increased profit margins instead of sales volumes

Now that Gianfranco Lanci is no longer the CEO and President of Acer Inc., the company can follow the vision of its board of directors -- by being more like Apple and HTC. 

Lanci's goal -- and, by extension, Acer's -- in the past was to sell more laptops than anyone else, including Hewlett Packard. Despite some successes, the strategy wasn't working for Acer's bottom line, with the company facing its second straight losing quarter. 

The rift in ideology caused Lanci to resign abruptly yesterday. According to Bloomberg BusinessWeek, Acer will name a new president -- one with experience in smartphones and tablets -- later this month. Company chairman, J.T. Wang, will fill the spot in the interim.

"For Acer, and other PC makers in general, the way to create value is to innovate and find new markets and opportunities, and that’s a big challenge," Simon Ye, a Gartner analyst, told Bloomberg. "Acer’s problem is that it is commonly perceived as a brand that competes on price, and that doesn’t help profitability." 

Acer's focus going forward is to maximize profitability instead of sheer sales volumes, spokesman Henry Wang told Bloomberg. This will require, among other things, an increase in spending on research and development.

Apple's business model is certainly one the Taiwanese company will be looking to emulate. According to Bloomberg, the iPad maker had a 21.5 percent profit margin in its last fiscal year, while Acer had a mere 2.3 percent. 

One major focus of the future is the tablet market, which has proven its worth over the last few quarters in particular. "There is good consensus among the board members that the tablet is the way to go," Acer CFO Tu Che-min told Bloomberg.



Comments     Threshold


This article is over a month old, voting and posting comments is disabled

duh
By invidious on 4/1/2011 12:52:17 PM , Rating: 2
They are bleeding cash and they want to be more like one of the more profitable tech corporations in the world? Who could have figured that?

Unfortunately for Acer there really isn't room for more than one "Apple" in the market. So unless they think they can beat Apple at their own game it would probably be wiser to try to be like one of the more conservative business model tech corporations.




"Paying an extra $500 for a computer in this environment -- same piece of hardware -- paying $500 more to get a logo on it? I think that's a more challenging proposition for the average person than it used to be." -- Steve Ballmer














botimage
Copyright 2014 DailyTech LLC. - RSS Feed | Advertise | About Us | Ethics | FAQ | Terms, Conditions & Privacy Information | Kristopher Kubicki