Case Scenario 2: Heartsong LLC

question 3

Essay

Case Scenario 2: Heartsong LLC.
Heartsong LLC is a designer and manufacturer of replacement heart valves based in Peoria, Illinois. While a relatively small company in the medical devices field, it has established a worldwide reputation as the provider of choice of high-quality, leading-edge artificial heart valves. Most of its products are sold to large regional hospital systems and research hospitals around the world, though primarily to customers in the United States and Europe. Specialty heart centers are another emerging, but fast-growing market for its valves. Heartsong has recently embarked on an expansion strategy that requires it to increase its volume, which in turn will demand more component parts than it can source domestically- both from an economic and volume standpoint. The firm has determined that such growth is only viable if it produces these parts itself overseas for a lower cost, or outsources the production entirely to a joint venture it establishes with a local manufacturer, which could both produce the parts more cheaply and in higher volumes. It is considering starting up an owned production facility in Luxembourg, or seeking a joint venture with a precision manufacturer in China.
-(Refer to Case Scenario 2). What opportunities and threats might Heartsong be exposing itself to via the
Luxembourg expansion proposal?

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Definitions:

Government Control

Government control refers to the mechanisms, regulations, and actions taken by a government to oversee, direct, or manage its country's economic activities, industries, or individual behavior.

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Government spending or expenditure, including costs on public services, infrastructure, and social welfare programs.

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Naturally occurring materials or commodities valuable for their intrinsic properties and used by humans for production, such as minerals, forests, and water bodies.

United Arab Emirates

A federation of seven emirates on the eastern side of the Arabian Peninsula, known for its oil reserves, modern architecture, and vibrant economy.