Roca Case Study
Roca Case Study
Roca Radiadores S.A. is an entirely Spanish-owned company which has achieved extraordinary international expansion.To answer the question what motivated Roca to start internationalization we need to pay attention to the history and further expansion of Roca. Roca began its activities in 1915 as Compañía Roca Radiadores S.A, a company that exclusively made cast iron radiators for domestic heating at its factory in Gavà, near Barcelona. Over the course of about 60 years, Roca established its first foreign subsidiary in France because by that time, all the possibilities of further expansion in the Spanish market were extremely limited. Roca’s capital is wholly owned by the family group arising from its founders. The shareholders currently comprise over 50 members of the Roca family. The total turnover has been increasing steadily, reaching now over 800 million euro, with profits over 35 million euro per year. Roca has a stable financial statement. Roca makes decisions very slowly, evaluating the risks involved. It hardly uses bank loans, thus financing its growth mainly on reserves.
Roca sells its products in over 70 countries in the six continents. Roca began increasing its international commitments as exports volumes rose. It was extremely difficult to start up exports in different countries. It faced technical barriers, varying national customs in different countries, trading limits, social differences in different countries, but there were several factors which motivated Roca to start its expansion and thus gain from internationalization:
1. All the possibilities of further expansion in the Spanish market were extremely limited. So, it explains desire to grow
2. Stable financial statement (Its growth is based mainly on reserves, not on loans)
3. Higher profitability after entering the international market
4. Obtain prestige in the domestic market
5. There is no information in the case study about competitors, but clearly there are always
Roca Radiadores S.A. is an entirely Spanish-owned company which has achieved extraordinary international expansion.To answer the question what motivated Roca to start internationalization we need to pay attention to the history and further expansion of Roca. Roca began its activities in 1915 as Compañía Roca Radiadores S.A, a company that exclusively made cast iron radiators for domestic heating at its factory in Gavà, near Barcelona. Over the course of about 60 years, Roca established its first foreign subsidiary in France because by that time, all the possibilities of further expansion in the Spanish market were extremely limited. Roca’s capital is wholly owned by the family group arising from its founders. The shareholders currently comprise over 50 members of the Roca family. The total turnover has been increasing steadily, reaching now over 800 million euro, with profits over 35 million euro per year. Roca has a stable financial statement. Roca makes decisions very slowly, evaluating the risks involved. It hardly uses bank loans, thus financing its growth mainly on reserves.
Roca sells its products in over 70 countries in the six continents. Roca began increasing its international commitments as exports volumes rose. It was extremely difficult to start up exports in different countries. It faced technical barriers, varying national customs in different countries, trading limits, social differences in different countries, but there were several factors which motivated Roca to start its expansion and thus gain from internationalization:
1. All the possibilities of further expansion in the Spanish market were extremely limited. So, it explains desire to grow
2. Stable financial statement (Its growth is based mainly on reserves, not on loans)
3. Higher profitability after entering the international market
4. Obtain prestige in the domestic market
5. There is no information in the case study about competitors, but clearly there are always