Arjun Tamhane- 11020241005 Ashwin Singh Chadha- 11020241007 Garima Upadhyaya- 11020241009 Juned Parkar- 11020241012

Concepts covered
1.

New set of macro environmental factors, constraints and conflicts.

-Multicultural environment with differing expectations.

2. 3. 4.

International specialization & cross-sourcing. Trade Blocs Network of global linkages.

Contd
5. Evolution in Commodities Exchanged 6. Firms operating in a market space rather than a market place. 7. Awareness of global developments & developments of capabilities. 8. Lengthening or rejuvenating product life cycles. 9. High productivity in light of stiff international competition.

How are the Concepts Relevant to AI

New set of macro environmental factors, constraints and conflicts. - Re-opening of AI after Peso Devaluation - Different Demands from USA, Japan & Europe 2. International specialization & cross-sourcing. - AIs venture into Fruit Business - Agreement with Congeladora de Samora - Never growing their own produce
1.

3. Trade Blocs

Mexico a Part of NAFTA giving Tax Benefits to AI - Barrier to other Countries entering NAFTA 4. Network of global linkages. - US market dropping PPM rate for strawberries. - Long term relationship to sustain high quality for prices offered.
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5. Evolution in Commodities Exchanged - Change from primary to manufactured goods - Cucumbers in Brine Solution for Direct Pickling 6. Firms operating in a market space rather than a market place. - Different Country requirements for AI products - Facilitate certification in additive levels.

7. Awareness of global developments & developments of capabilities. - Japan visit for Grapefruit - Canning Plant Problems 8. Lengthening or rejuvenating product life cycles. - Increasing supply to Japan - New products sent to USA

9. High productivity in light of stiff international competition. - Advance Contractual Buying - Picking of right-size as per Japan Requirement - Different quality standards

Profile of AI
Earlier Stage Founded in 1973 as a labour intensive food processing unit AI were not into growing of agricultural produce. Had to close down operations for a while due to adverse economic scenario Later Stage Revived in 1986 by largely focusing on exports Developed multiple fruit lines to keep them busy all round the year US food broker World Food Sales Exporting to US, Japan, Canada, Europe
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Major Events
1987
Availability of chillies due to opening of markets made AI venture into new line product line

1987-90

Ventured into Japan Lack of technology lead to production problems and extension of deadlines

1990

They started importing packaging materials(cans) from the US.

1992

Their production line included Grapefruit, Oranges, Lemons and Strawberry as well. They had started to export to Japan, Europe and Canada.
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Decisions
Getting into a labour intensive activity Being in Mexico the labour was cheap Stationing of AI quality controllers on growers fields Maintained quality for their quality conscious clients AI was also supplying chemicals and fertilizers They could meet the trade barrier requirements. Benchmarking the product quality Brine solution for Cucumbers - Evolved their product for special needs of customer
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Decisions
Selecting Grapefruit as an export product for Japan Had a huge demand in Japan. AI was not well prepared for it. Started importing cans from the US This resolved their production problem. Empty cans were imported. Exporting on an exclusive basis They were able to establish a relationship. They became totally dependent on their distributor
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Decisions
AI did not use private labeling They initially saved the cost of branding. Their product was being sold at twice the FOB cost. They developed World Food Sales as a brokerage

subsidiary
Acted as a supportive arm to AI. AI could have lost their current growers.

They were not producing products they sold They were able to provide the best food processing. This model could have backfired.
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Decisions
Huge investments were made by the owners Less of working capital loans Reduces the risk appetite of the owners Choosing Middleton They got a cheap deal. Their efficiency was suffering Lemon case
Product Strategies Product lines that were not chosen by its competitors.
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Suggestions
1.
2. 3. 4. 5.

While selecting Grapefruit as a product they should have done a thorough research. They could have imported raw materials instead of cans. Initially they could have contacted more number of distributors in Japan. They should have selected their transport partner based on its capabilities. To bring down their working capital requirements they could have explored domestic markets.
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Suggestions
6. Subscribe to LIBOR loans since exports are also in

foreign currency. 7. Leverage to information received from WFS wrt current products. 8. Partner with a distributor to sell to Companies directly. 9. Contingency contracts for growers.

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