1. Waaha Case Study
Wahaha is the largest soft drink producer in China, competing with the big players including Pepsi
and Coca Cola. It was founded in 1987 when the company began selling soda water, ice cream, and
stationary to children. The founder, Zong Qinghou, found that there are 38 companies in the nation
producing nutritional drinks but none of them were targeted to children. The idea became an instant
success and increased the revenue to RMB400 million by 1990. However, management soon
realized this growth would be difficult to sustain and they would have to act fast in order to expand
market share and increase the company growth. One advantage for Wahaha is that they had a solid
cash position without any long term bank debt which isn't company for Chinese companies of their
size. They also set specific goals to achieve like establishing subsidiaries in provinces which ended
up being a very successful endeavor. Wahaha underwent many brand extensions which sparked a lot
of debate about whether or not it would dilute the brand. Zong argued that extended the brand into
categories that didn't have a dominant brand yet would benefit Wahaha overall. This ended up being
a very successful idea. They also had a strong brand known for "health, wholesomeness, happiness,
quality and reliability, and just a brand for children's nutritious drinks". The company was able to
growth further due to acquisitions. This helped the company expand to different regions and
provinces while growing brand recognition and share of the markets. One of Wahaha strongest
competitive strategies was their ability to lead the market by having strong management within the
company. Competitors would follow close on their heels but none were able to surpass because of
poor company management this included larger companies as well. Zong attributed the company's
success to its superior understanding of the Chinese market: "Market research reports in China are
not reliable. You pay the market research firms large amounts of money and you don't know where
the money was spent. However, our own marketing people are market research staff since we are
always collecting information about the market, and we make decisions based on their understand of
the market." The
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2.
3.
4.
5. Case Study of Danone
Entry mode dynamics 2: strategic alliance partners Case 12.1 Danone's affair in China As of 2007,
Danone, the French multinational food company, was in a fierce battle with China–based Wahaha
Group (the largest beverage producer in China) to win control of their joint ventures (JVs) in China.
The fight is reported to have started in 2005 when Danone uncovered some unusual financial figures
at the JVs, but this did not become known to the public until 2007, when Danone and Wahaha
Group failed to resolve their disputes on the selling price of Wahaha–related non–joint ventures
(non–JVs). The quarrel between Danone and Wahaha Group has escalated. It involves disputes on
brands, as well as on perceived unequal commitments to the JVs. Lawsuits have ... Show more
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Moreover, Danone 'lacked the management depth and size to grow quickly'.16 The cooperation
between Danone and Wahaha started in 1996. Danone and Peregrine Group set up a Singapore–
based firm called Jinja. Jinja and the Wahaha Group then set up five JVs in 1996, with Wahaha
controlling 49 per cent of the shares, Danone 41 per cent and Peregrine 10 per cent.17 Jinja invested
$45 million in the JVs, while the Wahaha Group gave the JVs the assets from five of its subsidiaries.
All three parties agreed to let the Wahaha Group take full control of the everyday operations of the
JVs. Even after Danone took the position of majority shareholder in 1998 (when Peregrine Group
sold its shares in Jinja because of Peregrine's financial problems during the Asian crisis), Danone did
not have a single executive in the joint ventures and Zong ran the joint ventures with a high degree
of autonomy. 329 International Business Strategy The cooperation appeared to work well. The
new cash from Jinja enabled Wahaha to invest in both marketing and advanced production lines. In
2003, Wahaha had 15.6 per cent of China's total beverage production, and its income reached $1.24
billion. Since 1997, Wahaha had been China's number one domestic, nonalcoholic beverage
producer in both production volume and sales revenue. With annual sales of around $1.35 billion,
the JVs accounted for 75 per cent of
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13. Tale of 2 [Ppl
C O M M E N TA RY
A Tale of Two Companies
The Danone–Wahaha partnership once seemed ideal, but the companies' relationship has
deteriorated. What lessons can be learned from the dispute?
Jingzhou Tao and Edward Hillier
T
he Danone–Wahaha dispute is a story of the relationship between two very different entities against
a backdrop of incredible change. The dispute reveals many questions that China faces as it integrates
into the world economy, such as what to do when rule of law leads to an unpopular result or harms a
valued Chinese company.
The players
Group Danone SA, a Paris–based multinational corporation (MNC), is a giant in the global dairy
product and bottled water markets. The MNC employs roughly 90,000 staff across ... Show more
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¥1.04 billion ($147.2 million). highlights the intersection of Since many JVs created in the 1990s
may After negotiations failed, Danone public opinion, nationalism, and face similar problems,
perhaps a more relrequested arbitration in Stockholm, the rule of law in China. evant question is,
what else could or Sweden, and filed lawsuits in Los Angeles s Disputing companies should should
Danone do to manage the situaand other cities, mainly over trademark pay close attention to their
public tion now and regain control of the JVs? infringement and non–compete obligarelations
efforts. First, Danone should have a clear pubtions (see Table). s In disputes with Chinese lic
relations strategy to manage how it Zong and his supporters responded in companies, foreign
companies appears in the Chinese media. Danone kind, requesting arbitration in should be careful to
avoid sparking risks jeopardizing its future in China if Hangzhou, Zhejiang, to confirm that a
nationalist backlash. Chinese consumers turn against it– Hangzhou Wahaha Group–not the Chinese
nationalism should not be Danone–Wahaha JV–owned the underestimated. Though Danone holds a
Wahaha
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14.
15.
16.
17. Essay On Danone
The strategy Danone employed in China was the traditional capital investment method. This was a
strategy that helped Danone succeed in many other markets. Thus, Danone chose to apply the same
strategy in China, ignoring the changing demands of the Chinese buyers and their patriotism
towards their country. Danone's ultimate goal is to take over the Chinese beverage industry.
Therefore it needed to acquire or merge with competition. Danone remained quiet and turned a blind
eye when it knew of Wahaha Group's use of the trademark and breach of the non–compete
agreement. This could be in part due to the fact that Danone was acquiring other companies such as
Wahaha's direct competitor, Robust. I consider this a "give and take" strategy used by Danone.
Danone did not want to rock the boat with Wahaha as it was pursuing its own interests separately
too. Therefore, rather than confront Wahaha Group about the ... Show more content on
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Danone accepted his resignation and chose to appoint a French to replace him. Danone was forced
to file arbitration in Hangzhou as dictated by Wahaha Group. When it lost the suits in China, it
decided to use its exit strategy of selling its shares of the WJV to Wahaha Group, cutting its losses
short. This was the best Danone could do as it was not gaining support from both its employees (in
China) and the public in its fight with Wahaha Group. Analysis of Zong's / Wahaha's Point of View
Zong and Wahaha took offense when Danone took over 51% control of the WJV. They viewed
Danone as a sly foreign partner who used underhanded means to gain control of Wahaha Group.
Zong and Wahaha employees were upset when the WJV made Wahaha a privatized company. They
felt cheated by Danone and wanted to take back control of the trademark. Zong also resented the
way Danone ran the business. He felt that Danone was full of arrogance and was constantly pushing
him
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18.
19.
20.
21. Case Study of Danone
Entry mode dynamics 2: strategic alliance partners Case 12.1 Danone's affair in China As of 2007,
Danone, the French multinational food company, was in a fierce battle with China–based Wahaha
Group (the largest beverage producer in China) to win control of their joint ventures (JVs) in China.
The fight is reported to have started in 2005 when Danone uncovered some unusual financial figures
at the JVs, but this did not become known to the public until 2007, when Danone and Wahaha
Group failed to resolve their disputes on the selling price of Wahaha–related non–joint ventures
(non–JVs). The quarrel between Danone and Wahaha Group has escalated. It involves disputes on
brands, as well as on perceived unequal commitments to the JVs. Lawsuits ... Show more content on
Helpwriting.net ...
This initial setback with dairy products drove Danone to copy in China the alliance strategy used
with great success to expand into Italy and Spain in the 1980s. Danone decided to capitalize
successful local businesses rather than build its own businesses from scratch, resulting in a strong
focus on joint ventures and acquisitions. Unlike most multinationals, Danone gave these acquired
local businesses a great deal of autonomy. The joint ventures and acquired firms continued to sell
their products under their own brands. Until late 2002, 80 per cent of Danone's sales in China were
under local brands. Furthermore, Danone let the former executives run the businesses and didn't get
involved much in daily operations. In fact, Danone functioned more like a capital investor, linking
its joint ventures through capital investment rather than joint products. This expansion strategy in
China worked very well. In 2001, Danone had become one of the largest food concerns in China,
with $1.2 billion in sales, more than 50 plants and around 25,000 employees.14 Accounting for 9 per
cent of Danone's international sales in 2003, China became Danone's third largest
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22.
23.
24.
25. Strategies for Competing in a Changed China
Strategies for Competing in a Changed China
Magazine: Summer 2004Research Feature July 15, 2004 Peter Williamson and Ming Zeng
This paper presents the results of the authors' detailed research into competition between
multinationals and local Chinese companies in 10 industries over the past five years. They conclude
that local companies are now threatening multinationals' plans to conquer the China market. They
analyse this new competitive game in terms of a dynamic battle of competencies. Multinationals
start off with better industry–specific technology and know–how, and a higher level of competence
in key functions like marketing and financial management. Chinese companies enjoy a better
understanding of the local market, lower ... Show more content on Helpwriting.net ...
Our research over the past five years into the battles between multinationals and local Chinese
companies reveals that while market dominance by local champions is far from universal, it's
becoming ever more frequent. In industries as different as beer brewing, mobile–phone
manufacturing and laundry–detergent production, Chinese companies – often seeming to appear
from nowhere – are forcing multinationals to rethink their strategies and their hopes for explosive
growth in the China market.
1
The message is clear: Multinationals must factor in the existence of robust local competition,
while considering the new opportunities that have opened up as a result of China's WTO
membership. To understand the way competition between multinationals and local champions is
evolving and to pinpoint the keys to success, we traced the evolution of competition in China in 10
industries over the last 10 years.2 We conducted more than 100 interviews with dozens of leading
companies operating in China, both multinationals and locals, and reviewed thousands of pages of
secondary data. The picture of competition that emerged from our research can best be described not
in terms of traditional market positioning, but as a battle of competencies between multinationals
and local players.
Constraints on Multinationals Multinationals generally start off with clear advantages in two areas:
They have
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26.
27.
28.
29. Case Analysis Of Danone
However, there are several drawback of joint venture which is potential risk. Danone, as a global
multinational cooperation, may concerned about the risk of technology transfer and intellectual
property management to the local Chinese ambitious company. The merging different management
style due to the culture diversity and the priority to the outcome. Indeed, the conflict with each
partner of their interest ratio. The interest ratio has changed during their period of joint venture. At
first, the Wahaha Group owned 40% of the share of the JV as the biggest shareholders. Jinjia
belongs to both Danone and Baifu which is 51% in total. However, two years later, the interest ratio
changed which reverse the position of the two partners in the JV. Since Danone acquired Jinjia, they
can establish firm with known revenue and profit stream. Hence, the direct influence to the JV is
that Danone owned the entire 51% of the share of the JV and become the majority share of the JV.
Therefore, the potential conflict and suspicion has risen stealthily from the Wahaha Group party.
After 2000, Zhong had created the non–joint venture without the permission of Danone. When
Danone found the exist of the non–join ... Show more content on Helpwriting.net ...
However, since Danone emerge Jinjia, the status of Wahaha Group in the JV has been challenged
and threaten by a foreign company. As usual, joint venture should hold the share as 50 to 50 percent
in order to balance the power of two parties. Nevertheless, Danone hold more than a half of the
share which directly declare the majority right of the JV and threaten the Wahaha Group and Zhong.
. As a result, Wahaha Group was suspected Danone of their initial motivation with Baifu since then.
Accoding to Hamel(1987), distrust will spoil and threaten the survival of the other partners. Due to
lack of the communication, the suspicion and break the trust bridge between the
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34. Poor communication channels lead to misunderstandings; look into improving communications
within the department, e.g. regular team briefings.
Lack of promotional opportunities; perhaps investigate the possibility of delegating responsibility to
allow subordinates to gain valuable experiences.
Given the culture, the new HOD might be expected to be more democratic in his/her approach to
conflict management, e.g. perhaps by using forms of empowerment.
Conflict may also arise if the Principal uses external recruitment to appoint the new HOD.
Any conflict between subordinates will most likely to be dealt with by the HOD, i.e. conflict is
resolved within the department.
The new HOD will therefore need to have good interpersonal and communications skills. S/he may
also need to develop situational management styles with clear goals and objectives for the
Department.
[5 – 6 marks]
There is a thorough examination of the various ways in which different sources of conflict can be
handled by the Head of Department. Appropriate terms are used with good application.
[3 – 4 marks]
The examination
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35.
36.
37.
38. A Joint Venture Company
From the point of view of a general manager in a JVC there are many things to take into account
during the day–to–day management. It is likely to be different from normal organization since
employees are formed by people from different countries which have different tradition while at the
same time the manager has to face possible divergent requirements from the patent companies.
Some issues could happen during the short to long run and may have huge impact on the JVC.
Therefore solutions and suggestions will be given in order to minimise the impact they have on the
long–term survival of the JVC.
2 Employee performance challenges
2.1 Culture differences
The creation of a joint venture company (JVC) is to combine forces from two or ... Show more
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2.1.1 Building the team
Tuckman (1965) suggested that there are 4 stages of development that a team will go through which
are forming, storming, norming and performing. The first stage forming is when people come
together to get to know each other and try to avoid conflict at the same time. During this stage there
should be no obvious issues for the manager because people are just trying to get to know each other
and trying to learn what to do next. On the other hand the situation on the following stages could be
more challenging. During the storming stage employee will start to have conflict with each other.
These conflicts could be caused by differences in culture and working style in previous company
where employee may find hard to adopt. If the problems were not fix properly then it is possible that
the team can stay together any longer. The third stage is when team members had overcome all the
conflicts and members started to bind together where they will be supportive and respect each other.
The general manager should be alerted at all times even at this stage because may be people
compromise only due to the fear of losing their job. They will then reluctant to share ideas that
might improve the performance because it might just create another possible conflict.
2.1.2 Employee relation
Good employee
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39.
40.
41.
42. Oreo and Pt Danone Biscuit
TUGAS
MANAJEMEN INTERNASIONAL
STRATEGIES FOR INTERNATIONAL COMPETITION
&
ANALYZING AND MANAGING FOREIGN
MODES OF ENTRY
FOR
FOOD INDUSTRY (BISCUIT)
Oleh :
Kelompok 5
Margaretha Pink Berlianto (19090054)
Diana Permana (19090062)
PROGRAM STUDI MASTER OF MANAGEMENT
UNIVERSITAS PELITA HARAPAN
JAKARTA
2010
DAFTAR FOREIGN DIRECT INVESTMENT DALAM BIDANG FOOD INDUSTRY (BISCUIT)
DI INDONESIA
1. PT Kraft Foods Indonesia. 2. PT Arnott's Indonesia. 3. PT Ceres Meiji Indotama.
DAFTAR IMPORTIR DAN DISTRIBUTOR DALAM BIDANG FOOD INDUSTRY (BISCUIT)
DI INDONESIA : 1. PT Pandurasa Kharisma (Wernli, Famous Amous) 2. PT Nirwana Lestari
(Toblerone, Guylian, Ritter Sport, Toffifee, Merci, Werthers Original, Pez, Fisherman Friends,
Riesen, ... Show more content on Helpwriting.net ...
Both children and adult people like snacks.
The types of biscuits as snacks grow fast both in taste, packaging and form. Biscuit snacks have
wide market with market targets including children, boys and girls. The competition, therefore is
tight among the products of biscuit snacks marked with aggressive advertising by producers.
Investors are more interested in the market of biscuits for snack in the country.
43. Production capacity growing
Capacity utilization of the country's biscuit industry is high despite price hikes of basic materials.
Production capacity of Indonesian biscuit industry has increased from year to year reaching 232,762
tons in 2003, and 246,728 tons in 2004 and 299,035 tons in 2006.
The increase in production capacity followed expansion by some of the many producers and the
operation of new producers.
Producers of biscuit and production capacity
Most major producers in the country such as PT Khong Guan, PT Mayora Indah, PT Arnott's
Indonesia and PT Nabisco Foods produce wafer, cookies and crackers.
There are few producing biscuits in tin but they have large market shares especially on certain
occasions like Idul Fitri, Idul Adha and Christmas and new year when many people give, send or
exchange gifts.
The country has more than 200 producers of biscuits––medium and large producers. Among the
large producers are PT Khong Guan Biscuit, PT Mayora Indah, PT Nabisco Foods, PT Arnott's
Indonesia, and
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44.
45.
46.
47. Walmart Management
entRECHACHE Khaled Oualid EBS Paris Student Shanghai University
Marketing Report
Example of Wal–Mart
Summary
I.The Chinese Retail Market A. Analysis of the Chinese Retail Market
B. A picture of China's Retail Market : facts & figures
II. Wal–Mart in China
III. Wal–Mart suggested business model in China
A. General Analysis
B. Suggestions
I.
The Chinese Retail Market
China is first of all a demographic power: 1 human being out of 5 is living there. It is a permanent
member of the United Nations Security Council is in possession of the nuclear weapon and recently
shoots down its own space satellites: this makes from it also a military power. As a matter of fact,
China is replacing Japan as the diplomatic ... Show more content on Helpwriting.net ...
Even if foreign retailers do not need the approval from one central authority anymore, they have to
run after much necessary permission to open new stores. Besides, under this strong competition
context, the government is hardly to bring in new laws to calm the situation. Obstacles are quite
numerous. Let's summarize this analysis into a graphic to have a better representation of the
procedure how to penetrate this market.
B.
48. A picture of China's retail market: facts and figures
After this analysis, we are going to take a look at the characteristics of the Chinese retail
market. The typical Chinese consumer purchases grocery products very often. Traditional retailers
seem to be adapted to this Chinese consumption habits
These all are still well–established above all in the rural area but today the consumer can go either
in supermarket, in open–air markets, or in hypermarkets. And since the introduction of
hypermarkets, sales through this format have grown at a far higher rate than any other outlet type.
Hypermarkets do not stop in gaining market shares and represent today the most important modern
format. The hypermarket is characterized by a large selling area with a wide choice, the presence of
food and non food items, and it offers advantages that other formats are not able to offer. To achieve
this goal, they launched a new format: the discount outlets. What is of real significance, is that the
goods sold through these
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49.
50.
51.
52. Case 11 Mabindra Mabindra B
www.ib.cdc.org
Case 11 Mahindra & Mahindra
(B):
An Emerging Global Giant?
"I have been on record to say that my philosophy of going global is because if you don't succeed
abmad or don't have the capacity to succeed abmad and to carve out some turf abroad you are not
going to be safe at home [. . .}. If you want to compete with multinationals you have to be a
multinational.
So that is the logical rationale for going abmad.HI
–ANAND G. MAHINDRA,
Vice Chairman and Managing Director,
Mahindra & Mahindra Ltd., in 2010.
In 20 II, India–based automotive giant Mahindra & Mahindra
Ltd. (M&M) was featured on the Forbes Global 2000 list,2 a ranking of the biggest and most
powerful companies in the world. Besides M&M, some of the other Indian ... Show more content on
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The group of Brazil ,
Russia, India, China, Mexico, and South Korea are commonly referred to as the Big Six ("B6") by
global management consulting firm Accenture, as they are the leading developing economies.
Earlier, owing to their low–cost structures, the developing economies served as mere outsourcing
locations for the MultiNational Companies (MNCs) of the West. However, the changing global
economic scenario had brought down trade and investment barriers and integrated global supply
chains, thereby paving the way for the development of emerging markets. Some of the developing
countries were witnessing rapid growth and thus the nomenclature Rapidly Developing Economies
(RDEs) was assigned to them. The term "Rapidly Developing Economies" was used to denote
emerging markets such as China, India, Mexico, Brazil,
Russia, South Africa, Poland, Indonesia, Turkey, and South Korea.
Moreover, the importance of the emerging markets to the global economy came into sharp focus as
the world came out of the global economic recession. Experts said that the importance of emerging
economies to world trade had been steadily increasing. Between
1990 and 20 I0, the annual growth rate of exports and imports from emerging and developing
economies averaged around 7.5% compared to the figure of around 5% for developed economies.4
53. It was reported that the share of the RDEs in global trade was growing significantly. Notably, ROEs
were
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