Dilemma: How Best to Enter the Organic Food Market?
G&H Foods is a large dairy food producer, specializing in milk, butter, cream, yoghurt and ice cream. There is a lot of interest now in healthy food products and many consumers want to buy organic food, produced in a traditional way without the use of chemicals. G&H’s directors want to have a share in the organic food market and they believe that the best way to enter the market is to take over (buy) a company that already produces organic products. They plan to create a new subsidiary which, they hope, will quickly become the market leader in the organic dairy food sector. G&H is looking for an organic producer which has created a popular brand with excellent products and offers good opportunities for growth. The company they choose should be profitable and well run, but it may need financial help to be able to grow. G&H is considering three organic producers with the idea of making an offer to the most suitable one. These options are:
A. Happy Farm: a farm that makes its own organic ice cream. B. Betty’s Kitchen: a small producer of organic ice cream and yoghurt.
C. Green Valley: a farm cooperative that produces organic milk, butter, cream and a range of different yoghurts.
Task 1 Read about the three organic producers on page 2 and think about the following:
1. The company’s history. 2. The company’s strengths and weaknesses. 3. Why you think the owners of the company may agree to a takeover.
Task 2
You need to decide which orzanic oroducer G&H Foods should offer to bu . Your decision should be based upon which or;anic oroducer offers the best 0: cortunit . Use the attached discussion sheet (pages 3 & 4) and identify the good things (+) and bad things (-) about each of the organic producers. ldentif 1 our decision at the bottom of
WW‘WM“ w' the sheet and eXo'laintheHreasons for our decision. Be prepared to discuss your decrsnon
with your group.