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 …show more content…
Protectionism in global banana market – Good or bad?
The present crisis being faced by the company seems to be a result of protectionism in the global banana market. Ideally there should be no restriction for free flow of goods and services but this is not true. There is hardly any field where restrictions are not present in trade as the nation/region imposing those restrictions wants to protect local economies from tough international competition. Banana industry is no exception to this general rule. The world is still in a transition phase as regards real integration of the world trade into an ideal single market. Undoubtedly the protectionism has played a spoil sport for big players in banana market but at the same time provided much needed support to developing nations especially ACP region that formed former colonies of Britain and France. The trade barriers proved successful for the less-efficient producers as they got protection against bigger players. Such a strategy can provide control to smaller entities in growing bigger and providing tough competition in the market.
Despite the protectionist policies of European region as regards banana trade the US companies and those from other parts of the world have made good money out of it. The trade has been quite profitable through all these years and has rather stopped this industry from becoming a home-ground for one or two big players only. The fact that this business needs a
John Soluri 's Banana Cultures: Agriculture, Consumption and Environmental Change in Honduras and the United States, (Which for spatial and repetitive purposes, I will refer to as Banana Cultures for the remainder of the paper), introduces the reader to a world of corporate greed, consumption, and environmental change using the history of the common, everyday fruit, the banana. He explores the various political occurrences, health problems, and changes in mass media through the rise of the consumption of the banana in the United States, and around the globe.
We eat bananas almost every day; however, most of us do not really know where these fruits come from. In Banana Cultures, John Soluri focuses on the relationship between banana production in Honduras, especially in the North Coast between roughly 1870 and 1975, and banana consumption in the U. S.. He focuses on growing, protecting, transporting, and mass marketing of bananas. John Soluri integrates Agroecology, anthropology, political economy, and history in order to trace the symbolic growth of the banana industry. The author admits that his work is highly interdisciplinary, as a desirable trait in the academic world. The study incorporates a wide range of sources, including manuscript census data from Honduras, fruit company records, published scientific records, Honduran and U.S government correspondence, oral testimonies, and ephemera from U.S mass culture. Throughout his work, he combines elements of geography, biology, social history, foreign affairs, and environmental history. Soluri also looks at labor practices and worker’s lives, changing gender roles on the banana plantations, and the effects of pesticides in the Honduran environment and people. His central argument is that United States consumption of bananas causes major social, political, and environmental change in Honduras. In addition, he looks at the banana pathogens, the ways the United States treated these fungal diseases, and the terribly detrimental effects these new treatments had on the farmers on
In today’s world, every person in every country has a similar image in mind when they think of the United States. Common words that come to mind are ideal, lazy, superior, and consumer. These words are associated with the United States due to American consumerism, or the practice of an increasing consumption of goods. In Martín Espada’s “Coca-Cola and Coco Frío,” he criticizes American consumerism by relating the people of Puerto Rico to ignorance due to the level of power the United States has over them. American consumerism is dangerous because it not only influences people worldwide, but also makes people forget about all of the wonderful aspects about where they live.
Exchange rate gains or losses are brought to account in determining the net profit or loss in the period in which they arise, as are exchange gains or losses relating to cross currency swap transactions on monetary items. Exchange differences relating to hedges of specific transactions in respect of the cost of inventories or other assets, to the extent that they occur before the date of receipt, are deferred and included in the measurement of the transaction. Exchange differences relating to other hedge transactions are brought to account in determining the net profit or loss in the period in which they arise. Foreign controlled entities are considered self-sustaining. Assets and liabilities are translated by applying the rate ruling at balance date and revenue and expense items are translated at the average rate calculated for the period. Exchange rate differences are taken to the foreign currency translation reserve.
By 1993, the Banana Empire ceased to exist due to Panama Disease, ongoing labour issues, the rise of new competition and the increased assertiveness of host country governments all contributed to the growing intricacy of the industry. Nowadays, the modern banana farmer has been exposed to many pesticides, which have led to adverse health conditions for the majority of workers but working conditions and wages are on the rise currently. The introduction of fair trade bananas in 2004 was fundamental in bettering the working conditions for farmers and labourers.
Chipotle Mexican Grill, Inc. is a “fast-food service restaurant” under limited service category. It was formed in 1993 and went public in 2006. It has the largest market share in the Mexican-type food segment with a net income of more than
The author of the book, “The Fate of the Fruit that Changed the World” (2008), Dan Koeppel, who is a famous journalist describes in a fascinating way banana’s cultural importance, threats associated with the crops of banana in the future and banana’ history. Banana is a very delicious fruit and is eaten all over the world. Banana is one of the world’s fourth largest harvests in the world. Dole and Chiquita are eminent American based distributors and producers of banana. They are claiming to produce the banana on low price. In this book, Koeppel discusses the risks associated to the plantation of banana around the world. He also discusses the fact that due to blight, the plantation of banana is destroyed (Koeppel, 2008). He points out that the farmers and the producers have no insight at all regarding this matter (Koeppel, 2008).
The fast food, or quick service restaurant industry (QSR), represents approximately 200,000 restaurants and $155 billion in sales in the U.S. alone, they are one of the largest segments of the food industry (Hoovers, 2011). This segment of the restaurant industry is “highly competitive and fragmented… number, size and strength of competitors vary by region, market and even restaurant. All of these restaurants compete based on a number of factors, including taste, quality, speed of service, price and value, name recognition, restaurant location, customer service and the ambience and condition of each restaurant” (Chipotle, 2010).
“Historically, the banana trade symbolized economic imperialism, injustices in the global trade market, and the exploitation of agriculture-dependent third-world countries”(2). However, they remain to be one of the most profitable items in grocery stores. Making bananas crucial to economic and global food stability for countries all over the world. They are the third largest staple crop, coming only after wheat and coffee. Since bananas are such a sought after fruit, many companies have gone to extensive lengths in the to fight for a share of the market. Chiquita Brands International was one of the pioneer companies to try and globalize bananas. They took a risk and made some very critical mistakes along the way.
While globalization is a relatively new phenomenon in theory, but not necessarily in history, as of 2009 it has created transnational corporations linked to government, international economic institutions, and non-government organizations. (Steger 67). With this definition bananas are a textbook example of the globalization of tropical fruit commodities. The transnational corporations of the United States, most notably Chiquita, Dole and Del Monte, have been linked to the governments of Latin and South America, the World Trade Organization, and the “organic” fruit movement. By tracing the path from banana plantations to supermarket it becomes clear how the “morals” of capitalism have permeated
* Some of the objectives of creating this union is to create a better flow on the circulation of goods, capital, people and services within the union. Once a good or service is accepted within the union it is protected from customs, taxes and import quotas as long as they remain within the union.
This report details several international management problems that Chiquita has been faced with over the past two decades. Many of these problems are to do with the company’s previously poor image when it came to Corporate and Social responsibility. Over the years Chiquita faced many accusations about the conditions workers were faced with at many of their facilities in Latin America and have also had their environmental policies questioned many times in the press. The company has made great strides in recent years in improving their public image with regards to corporate and social responsibility. In particular Chiquita’s commitment to the Better Bananas Project has helped improve their public image along with the
Coca-Cola was invented by John Pemberton the Coca-Cola Company began in 1886. With more than 1.9 billion consumers a day, in more than 200 countries, Coca-Cola is dedicated to being the world’s largest beverage company by maintaining and gaining customers. Customer preference is a core value to coke. Coke has dedicated itself to meet the thirst needs of every customer. They engage with their customers at home, restaurants, sporting events. Almost everywhere customers go, they can find a coke product. They build their top line growth and capital efficiency through investment in FIFA World Cup, “Open Happiness” global campaign, and have many worldwide partners, increasing their business nearly 5% every year by creating a diverse customer base.
Six firms dominated the banana industry in the early 1990’s, three from Europe and three from the United States. In 1994, the three United States producers, Chiquita, Dole, and Del Monte, accounted for approximately 72.4% of world banana sales. Chiquita accounted for 48% of worldwide banana sales and 66.4% of banana sales of the three U.S. producers.
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.