Family Business Roundup: Samsung, Benetton, and Hyundai
Samsung launches screen division for Apple
South Korea's Samsung has created a standalone team of 200 employees that will work exclusively on screens for their largest competitor Apple, according to Bloomberg.
Apple is currently the biggest customer for Samsung components and relations between the two companies have improved since they dropped all lawsuits against each other outside of the US.
“The new exclusive team for Apple implies that the relationship between Samsung and Apple has improved,” Jerry Kang, an analyst at Englewood, Colorado-based researcher IHS, said in the report. “This also suggests that Samsung Display will win screen orders from Apple, such as for the Apple Watch.”
Samsung was founded by Lee Byung-chul in 1938, and has made the Lee family one of the wealthiest in the world, with today's family members worth a reported $12.6 billion (€9.3 billion).
The Chaebol posted revenues of $208 billion in 2013 and controls approximately one third of the global smartphone market, although it recently forecast a 37% drop in quarterly profits.
Benetton Group falls short on factory disaster fund
Italian clothing empire Benetton has contributed $1.1 million to the Rana Plaza Trust Fund after coming under fire from activists for failing to support the victims of a Bangladeshi garment factory collapse in 2012.
The contribution will be formally announced today and brings the total to $23 million of a $30 million target. However, Benetton's contribution is likely to disappoint some labour unions after falling far short of Primark's $14 million.
“If you ask me if I am comfortable, I am more than comfortable,” Benetton's chief executive Marco Airoldi told the Financial Times. “I am sure we are doing something which is absolutely fair. Not only fair. We have decided to double our contribution.”
PwC estimated that Benetton sourced less than 2% of the building's total output and recommended that Benetton make a $500,000 contribution. They are the last major western brand associated with Rana Plaza to make a donation.
Benetton was founded in 1965 by Luciano Benetton and his siblings Giuliana, Gilberto, and Carlo. The half-a-century old company posted revenues of €1.82 billion in 2012, but is thought to have experienced a loss of €66 million the following year.
Hyundai to revamp outdated wage system
Hyundai Motor Corporation, the Korea-based car company controlled by the Chung family, has revealed it will update its existing wage system to reward employees based on merit rather than seniority.
The move comes as the manufacturer loses its competitive edge in South Korea as a result of high labour costs and a culture that respects seniority.
"Our wages have reached a critical limit as a manufacturing company," Hyundai chief executive Yoon Gap-han said in a letter to workers. "I am concerned that Hyundai may face a situation where it is impossible to produce vehicles at domestic factories anymore."
The revamp is not expected to reduce current wages or save the automaker any money in the near future, as an agreement that satisfies union representatives could take years.
Many of Hyundai's competitors already operate on performance-based pay scales.
Hyundai Motor is headed by 76-year-old chairman Chung Mong-koo, son of Hyundai founder Chung Ju-yung. The Hyundai conglomerate split into two in the late nineties, with Hyundai Group being taken over by Chung's fourth son Chung Mong-hun.
