Preview

Memo to Chiquita Brands International

Powerful Essays
Open Document
Open Document
1746 Words
Grammar
Grammar
Plagiarism
Plagiarism
Writing
Writing
Score
Score
Memo to Chiquita Brands International
MEMO
To: Chiquita Brands International

Introduction: For the subject choosing a strategy to overcome effects of EU’s banana policy, I have gone through the whole issue of EU’s banana policy and its effects on the banana business of Latin America in general and Chiquita Brands International in particular. I have also analyzed the way the whole issue has been approached by the company and tried to formulate a plan that may prove successful for the company. Since the present problem is a serious nature threatening the existence of a big player in the banana market, I have tried to go back to history of the company of highly political nature of the international policy making in this trade. I have tried to understand the role of protectionism in the global banana market as it has created a lot of problems for players like Chiquita Brands International. After a careful evaluation of the whole issue threatening the existence of our company, I have tried to find the way out.

Politics and Chiquita Brand International
It appears that Chiquita Brands International and politics have been intertwined with the birth of the company. The history of the company that dates back to 1870 has seen involvement of the company in trades to far off places. Right from the very first sale to North American markets the company seemed to move farther and farther to cater to newer markets and make big profits. Doing business in a foreign country brings in certain degree of uncertainty as the business has to work foreign legal framework governing business there. The company enjoyed a position of unchallenged power in Latin American region where it produced banana crops on its own land. Through banana trade, the company virtually controlled economies of the nations in Latin America. The company owned not only vast expanses of land in these countries but also owned roads, rail tracks, transportation networks as these were very crucial in banana business. The sheer size of business

You May Also Find These Documents Helpful

  • Good Essays

    Cerujugo Hr Case Analysis

    • 1050 Words
    • 5 Pages

    From the assigned reading it becomes clear that there are a number of symptoms which suggest that beverage manufacturer and distributer Cerjugo SA is a company in crisis. The main signal that Cerjugo is not living up to its expectations is that its forecasted sales and profit targets, for its juice division, have not been met for two consecutive years this is especially troubling for a company which in the past boasted a 98% share of the beer market in Latin America. Beyond the lack luster sales numbers there are many other symptoms that Cerjugo’s juice division is ailing, such as reports that potential customers are not aware of the “freshness” and high quality of the product and the brand reputation is suffering accordingly, this is particularly problematic because the “freshness” of Cerjugo’s juice is their main value proposition. Fault lines are also starting to show on the personnel front, with increased turnover rates in their sales force as well as stresses between top executives at the company, which often has them battling one another. Recently, Cerjugo President Manuel Perreria heard that his Manager of Juice Manufacturing, George Novedads will be resigning to take a position with a rival company, a clear sign that things have gone amiss.…

    • 1050 Words
    • 5 Pages
    Good Essays
  • Good Essays

    Intb 300 Portfolio Essay

    • 656 Words
    • 3 Pages

    The article titled “Brazil Seen Beating US in Soybean Trade as China Buys” discusses the rising production of soybeans in Brazil. The US is currently the largest grower of the product and therefore holds a comparative advantage in trade amongst nations. Rising supply from Brazil will create competition for the business of the largest demand which is held in China. “Production in Brazil climbed 53 percent in the past decade, compared with 7 percent in the US” (Javier, Chanjaroean, 2012). In 2012-2013, Brazil is said to produce 81 million tons of soybean as compared to 77.84 million tons in the US which portrays Brazil’s comparative advantage (Javier, Chanjaroean, 2012). China has imported 59.2 tons of soybean in the year ended September 30th of which, 45 percent were produced in Brazil and 39 percent were from the US. China utilizes soybeans to create meal for livestock and fish, and to produce cooking oil. It is clear that the US is losing its competitive edge on the production and distribution of soybeans mainly because it no longer possesses the comparative advantage in production. This analysis will discuss what enables a country to rise above its competition via the creation of comparative advantage in trade.…

    • 656 Words
    • 3 Pages
    Good Essays
  • Satisfactory Essays

    Through the Banana Republic, we see the transformation of old mercantilism methods of periphery-core resource extraction, into a form of liberal economic imperialism that retains many of the same principles of…

    • 246 Words
    • 1 Page
    Satisfactory Essays
  • Powerful Essays

    SA IBL TB8e Ch09

    • 2493 Words
    • 16 Pages

    In the dispute regarding the European Union's importation of Latin American bananas, the dispute panel found no…

    • 2493 Words
    • 16 Pages
    Powerful Essays
  • Good Essays

    -The United Fruit Company invested and gained political influence in some Central American nations. These…

    • 2074 Words
    • 9 Pages
    Good Essays
  • Powerful Essays

    We at Belco Global Foods are an international food distribution company. We export to 125 countries across the globe and are nearing $1 billion in annual sales. 40 to 50% of our sales are done on open account terms. We thoroughly examine any customers’ financials before allowing them to purchase from us on open terms. It is important for us to maintain a strong financial position as our gross margins are very low (typically 2 to 4%). For this reason, any time a customer cannot make payments on time, it becomes very troubling and is an issue that must be dealt with immediately to keep our company in a strong financial position. We sell on terms of 30 days, and of our $100 million in average receivables, only 0.0001%, or $10,000 is usually written off as bad debt for our insurance to cover in a year. Our customers come to us because we have proven over many years that our products are the best, and as such we can exercise strict terms to keep our financials tight.…

    • 1148 Words
    • 4 Pages
    Powerful Essays
  • Good Essays

    Before entering a new market a country analysis must be prepared in order to assess the likelihood of success or failure. Just like it is impossible to understand any sport without first learning its rules, country analysts must recognize the written and unwritten rules of conduct in order to evaluate national systems (country analysis pg. 5). In this case, Coe’s has prior experience in entering a new market abroad; which can be beneficial for further expansion. Coe’s expansion into Canada was successful but failed in Puerto Rico. Examining the success and defeat of these expansions can aid in the strategy development of expanding into Mexico.…

    • 222 Words
    • 1 Page
    Good Essays
  • Good Essays

    Blood Banana Case

    • 999 Words
    • 4 Pages

    As learned in class, the advantages of international business are great, but so are the risks. Some of the risks involve ethical issues as the ones Chiquita faced doing business in Columbia. Chiquita was the first to successfully internationalize banana trade; Chiquita did so by paying special attention to retail development and followed industry trends. Their competitive advantage was acquired when the company revolutionalized the banana trade by using refrigerated ships for the first time.…

    • 999 Words
    • 4 Pages
    Good Essays
  • Powerful Essays

    Perhaps more than any other agricultural product the banana reflects the colonial, neo-colonial, economic nationalism and contemporary stages of the evolution of the world economy.2 The banana was introduced to the North Americas in the late 1800’s because of the invention of the refrigerated ship.3 The influence of technology is evident even in these early stages of banana globalization. Since then, the banana has remained popular worldwide but has faced its share of problems. Between 1993-2001, there were disputes between America and the European Union (EU) due to a complex problem involving banana licensing. The stages of production, transportation and consumption all create a complex and important story to the most consumed fruit worldwide because its history intertwines with political and social trends.…

    • 1780 Words
    • 8 Pages
    Powerful Essays
  • Good Essays

    Blood Bananas

    • 1370 Words
    • 6 Pages

    Chiquita Brands International and its leaders learned a very hard lesson about paying off terrorist groups to protect their employees. Over the past 25 years, no place has been more perilous for companies than Colombia, a country that is finally beginning to emerge from the effects its Colombian banana subsidiaries had made protection payments to terrorist groups from 1997 through 2004. The Justice Department began an investigation, focusing on the role and conduct of Chiquita and some of its officers in this criminal activity. Subsequently, Chiquita entered into a plea agreement that gave them the dubious distinction of being the first major U.S. company ever convicted of dealing with terrorists, and resulted in a fine of US$25 million and other penalties. To make matters worse, the industry was facing pressure from increasing retailer purchasing power, major changes in consumer tastes and preferences, and Europe’s imposition of an “onerous tariff” on companies that sourced bananas from Latin America. With this in mind, Fernando Aguirre, Chiquita’s CEO since 2004, reflected on how the company had arrived at this point, and what had been done to correct the course so far. He faced major challenges to the company’s competitive position in this dynamic industry. What would it take to position the company on a more positive competitive trajectory? Would this even be possible in this industry and in the business climate Chiquita faced?…

    • 1370 Words
    • 6 Pages
    Good Essays
  • Satisfactory Essays

    The purpose of this paper is to refer to the case Kinshasa Abroad – African Cuisine and Culture, define the problems that appear regarding this case, and trying to find answers and solutions to these problems. As it can be noticed in the case, there are marketing problems regarding this business. There are two questions that need to be addressed. The first question is about the type of information that needs to be collected to help diagnose the marketing problem in this case. The second question, however, it is interesting because it asks to create a list of probing questions that should be asked…

    • 656 Words
    • 3 Pages
    Satisfactory Essays
  • Good Essays

    Garcia Marquez Strikes

    • 1059 Words
    • 5 Pages

    The latter of the issues can lead to deadly consequences. In the novel, One Hundred Years of Solitude, the banana manufacturers decided to take the issue into their own hands and eliminate the threat through the use of force. While…

    • 1059 Words
    • 5 Pages
    Good Essays
  • Powerful Essays

    Letter To Taco Bell

    • 1362 Words
    • 6 Pages

    Sixteen years of Speech Therapy ingrained a personal, unique hatred of the letter "R." If you had sixteen years of audio recordings, worksheets, and homework just saying every word in the English language with an "R"-you'd be sick of it too!…

    • 1362 Words
    • 6 Pages
    Powerful Essays
  • Satisfactory Essays

    According to their webpage, Chiquita is the only global banana company to have met the strict standards for Rainforest Alliance certification for 100% of their farms. This means that they meet the strict standards of the Sustainable Agriculture Network (a coalition of environmental…

    • 346 Words
    • 2 Pages
    Satisfactory Essays
  • Good Essays

    As one of well know coffee producer, Colombia has successfully increased its competitiveness via sophisticated marketing strategies of the FNC. It applies trademark and certification mark to protect Colombian coffee. Since registered GI it has increased consumer’s awareness and creates better advantage against other competitors.…

    • 406 Words
    • 2 Pages
    Good Essays