Problem Statement. Under What Conditions Should Schomer

1679 WordsMay 4, 20177 Pages
Problem Statement Under what conditions should Schomer and Clark suggest that Gerber walk away from the Alima Deal? Introduction Since Gerber’s founding in 1928, they have continued to grow to over the years with increased market share. As a company they are committed to providing children with nutritional food. In 1991, Gerber represented 72% of market share in the United States since it introduced processed baby food. Gerber was always focusing on quality and it paid off when it came to their bottom line. Even though birthrates within the United States had begun to fall off, sales increased 11% which brought total sales to over 1.2 billion. Another interesting statics was during the same time period 4% of U.S. homes had babies…show more content…
Gerber has done this by taking their resources and transferring them to the business side of the triangle efficiently, creating a corporate advantage. Starting with the central piece of the triangle, the core ideology, Gerber’s mission is to do everything they can to deserve and maintain the confidence mothers have in their products. A vital step towards this goal is maintaining tight relationships and a close proximity to their suppliers. This forwards them the ability to have great influence on what is grown and the processes to do so. This is a very specific resource and something that would not be easily transferable to a new business ventures, limiting their options of expansion. This could explain why they had such a hard time diversifying into baby clothes and toys eventually scaling their operations back into predominantly baby food and now forcing global expansion. When looking at the Alima plant it is a fortunate situation where the location of the plant is extremely comparable to their location in Fremont, MI. The Alima plant is within a close proximity of its suppliers but the relationships with the farmers are missing. As the case stated the farmers decided what they wanted to grow and the manufacturing plant would process whatever was sent to them. This is something that Gerber would have to change if they wanted to sustain their competitive advantage of having tight control of their suppliers. This would include convincing farmers to change their

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