Acer Inc. (/ˈeɪsər/; Chinese: 宏碁股份有限公司; pinyin: Hóngqi Gǔfèn Yǒuxiàn Gōngsī, lit. Hongji Corporation) is a Taiwanese multinational hardware and electronics corporation headquartered in Xizhi, New Taipei City, Taiwan. Acer's products include inexpensive desktop and laptop PCs, tablet computers, servers, storage devices, displays, smartphones and peripherals. It also provides e-business services to businesses, governments and consumers. In 2012 Acer was the fourth largest personal computer vendor in the world.[2]
In the early 2000s, Acer implemented a new business model, shifting from a manufacturer to a designer, marketer and distributor of products, while performing production processes via contract manufacturers.[3]
In addition to its core business, Acer also owns the largest franchised computer retail chain in Taipei, Taiwan.
Acer was founded by Stan Shih (施振榮), his wife Carolyn Yeh, and a group of five others as Multitech in 1976, headquartered in Hsinchu City, Taiwan.
It began with eleven employees and US$25,000 in capital. Initially, it was primarily a distributor of electronic parts and a consultant in the use of microprocessor technologies. It produced the Micro-Professor MPF-I training kit, then two Apple II clones; the Microprofessor II and III before joining the emerging IBM PC compatible market, and becoming a significant PC manufacturer. The company was renamed Acer in 1989.
In 1989, Shih hired Leonard Liu away from a 20-year career with IBM, making him president of the Acer group and chairman and chief executive officer of Acer America Corp. Liu's managerial style reflected his experience at "Big Blue": in contrast with Shih's traditionally progressive corporate culture, Liu tried to centralize control of Acer. At the same time, the computer industry quickly matured, shifting from a high profit margin business to a low margin commodity practically overnight. Price wars pushed component prices down so rapidly, and a strong New Taiwan dollar made the country's goods so expensive, that it became difficult to make a profit on the finished product.
In the early 1990s Acer experienced a decline in sales and profit. The US operations in particular were at loss due in particular to price war in this market dominated by Compaq, IBM, and HP. The autonomous management of US executives made things worse. Stan Shih undertook a series of immediate restructuring initiatives such as downsizing non-profitable operations, laying-off low performers, and tightening internal cost control. But in addition he redesigned completely the global organizational structure around three major business units and three managerial innovations.
Instead of creating a series of centrally controlled foreign subsidiaries, Acer established a network of virtually autonomous affiliates, much like a fast food franchise system. Each of these affiliates was managed by a group of locals who determined product configurations, pricing strategies, and promotional programs based on national or regional preferences. The affiliate would usually have just one Taiwanese person on staff to facilitate interorganizational communications. Sales & Marketing Management characterized the system as a "revolutionary departure from the traditional hierarchical model of worldwide branches and subsidiaries reporting to a head office". Instead, it was "a commonwealth of independent companies, united only in their commitment to a common brand name and logo".[5]
In 1993, Acer posted record profits of $75 million; 43 percent of that year's net was generated by the DRAM joint venture, considered "the most efficient in the DRAM industry" by some observers. Total sales grew to $3.2 billion in 1994, and net income increased to $205 million, as Acer America turned its first annual profit in the 1990s. From 1994 to 1995, Acer advanced from 14th to ninth among the world's largest computer manufacturers, surpassing Hewlett-Packard, Dell, and Toshiba.
Acer increased worldwide sales while simultaneously reducing its labor force by identifying and using marketing strategies that best utilized their existing distribution channels. By 2005, Acer employed a scant 7,800 people worldwide. Revenues rose from US$4.9 billion in 2003[8] to US$11.31 billion in 2006.
Acer's North American market share has slipped over the past few years, while in contrast, the company's European market share has risen.[9]
In the mid-2000s years, consumer notebooks have been almost the sole growth drivers for the PC industry, and Acer's exceptionally low overheads and dedication to the channel had made it one of the main beneficiaries of this trend.[10] Acer grew quickly in Europe in part by embracing the use of more traditional distribution channels targeting retail consumers when some rivals were pursuing online sales and business customers. In 2007 Acer bought Gateway in the USA and Packard Bell in Europe and became the Number 3 world provider of computers and number 2 for notebooks, and achieved significant improvement in profitability. Acer has been striving to become the world`s largest PC vendor, in the belief that the goal can help it achieve economy of scale and garner higher margin.[11] But such a reliance on the high-volume, low-value PC market made Acer exposed when buying habits changed.
Source: Wikipedia
In the early 2000s, Acer implemented a new business model, shifting from a manufacturer to a designer, marketer and distributor of products, while performing production processes via contract manufacturers.[3]
In addition to its core business, Acer also owns the largest franchised computer retail chain in Taipei, Taiwan.
Acer was founded by Stan Shih (施振榮), his wife Carolyn Yeh, and a group of five others as Multitech in 1976, headquartered in Hsinchu City, Taiwan.
It began with eleven employees and US$25,000 in capital. Initially, it was primarily a distributor of electronic parts and a consultant in the use of microprocessor technologies. It produced the Micro-Professor MPF-I training kit, then two Apple II clones; the Microprofessor II and III before joining the emerging IBM PC compatible market, and becoming a significant PC manufacturer. The company was renamed Acer in 1989.
In 1989, Shih hired Leonard Liu away from a 20-year career with IBM, making him president of the Acer group and chairman and chief executive officer of Acer America Corp. Liu's managerial style reflected his experience at "Big Blue": in contrast with Shih's traditionally progressive corporate culture, Liu tried to centralize control of Acer. At the same time, the computer industry quickly matured, shifting from a high profit margin business to a low margin commodity practically overnight. Price wars pushed component prices down so rapidly, and a strong New Taiwan dollar made the country's goods so expensive, that it became difficult to make a profit on the finished product.
In the early 1990s Acer experienced a decline in sales and profit. The US operations in particular were at loss due in particular to price war in this market dominated by Compaq, IBM, and HP. The autonomous management of US executives made things worse. Stan Shih undertook a series of immediate restructuring initiatives such as downsizing non-profitable operations, laying-off low performers, and tightening internal cost control. But in addition he redesigned completely the global organizational structure around three major business units and three managerial innovations.
Instead of creating a series of centrally controlled foreign subsidiaries, Acer established a network of virtually autonomous affiliates, much like a fast food franchise system. Each of these affiliates was managed by a group of locals who determined product configurations, pricing strategies, and promotional programs based on national or regional preferences. The affiliate would usually have just one Taiwanese person on staff to facilitate interorganizational communications. Sales & Marketing Management characterized the system as a "revolutionary departure from the traditional hierarchical model of worldwide branches and subsidiaries reporting to a head office". Instead, it was "a commonwealth of independent companies, united only in their commitment to a common brand name and logo".[5]
In 1993, Acer posted record profits of $75 million; 43 percent of that year's net was generated by the DRAM joint venture, considered "the most efficient in the DRAM industry" by some observers. Total sales grew to $3.2 billion in 1994, and net income increased to $205 million, as Acer America turned its first annual profit in the 1990s. From 1994 to 1995, Acer advanced from 14th to ninth among the world's largest computer manufacturers, surpassing Hewlett-Packard, Dell, and Toshiba.
Acer increased worldwide sales while simultaneously reducing its labor force by identifying and using marketing strategies that best utilized their existing distribution channels. By 2005, Acer employed a scant 7,800 people worldwide. Revenues rose from US$4.9 billion in 2003[8] to US$11.31 billion in 2006.
Acer's North American market share has slipped over the past few years, while in contrast, the company's European market share has risen.[9]
In the mid-2000s years, consumer notebooks have been almost the sole growth drivers for the PC industry, and Acer's exceptionally low overheads and dedication to the channel had made it one of the main beneficiaries of this trend.[10] Acer grew quickly in Europe in part by embracing the use of more traditional distribution channels targeting retail consumers when some rivals were pursuing online sales and business customers. In 2007 Acer bought Gateway in the USA and Packard Bell in Europe and became the Number 3 world provider of computers and number 2 for notebooks, and achieved significant improvement in profitability. Acer has been striving to become the world`s largest PC vendor, in the belief that the goal can help it achieve economy of scale and garner higher margin.[11] But such a reliance on the high-volume, low-value PC market made Acer exposed when buying habits changed.
Source: Wikipedia
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