名古屋大学大学院留学生側のインフォメーション    戻る

Information for Fruits & Nuts Inc.

You have been assigned to negotiate on behalf of Fruits & Nuts, Inc., a corporation formed under the laws of the country of Laputa (F&N), for the formation of a joint venture with the Springtime Cooperative, a legally recognized farmers' cooperative located in the country of Camelot. Laputa is a developed country. Camelot is a developing country.
F&N has expanded rapidly, in part because of its reputation for good service and good food, and in part because of the public reaction to news of Mad Cow Disease and recent reports on the health effects of a fast-food diet. From a single restaurant in 1990, F&N grew to 300 in 1995 and boasts 900 restaurants today. The company is now contemplating expansion into overseas markets.
Although the company has managed this expansion of its operations successfully, the same success that fuelled its expansion is expected to threaten its profitability. Currently, an F&N restaurant spends, on average, $200,000 per year on foodstuffs, against gross sales of $1,000,000. The ratio is high by industry standards, and changes in the cost of produce accordingly has a greater impact on the profit margin of F&N. A typical F&N branch consumes 1,300 kilos of potatoes per month, 300 kilos each of bell peppers and aubergine, and 75 kilos of lettuce. A wide variety of other produce is also used in preparing the F6N menu.
For better or for worse, the demand for organic food products among the public has driven up the price of organic produce. While the company can withstand moderate price rises in the short term, it is not certain that it will be able to retain its customer base if it is forced to raise its prices significantly. Since the company has built its entire image around the theme of organic food, switching to lower-cost non-organic sources of produce is not an option.
The bottleneck for F&N is the strict guidelines imposed by the Harvest Association, a highly respected institution in Laputa that certifies produce as being genuinely organic. To certify the produce of a farm as organic, the Harvest Association's guidelines require that no pesticides, herbicides or chemical fertilizers be used in growing crops, and that none be stored on the premises of the farm to be certified. Few farms are able to satisfy its strict requirements. Until now, F&N has served only produce from Harvest Association certified farms. This fact is included in its advertising in the Laputa market. The Harvest Association is active only in North America.
The president of F&N, Alan Anderson, recently made a trip to Camelot, during which he visited the Springtime Coop. He was impressed by the interest of the farmers in organic agriculture, and learned of a "Green Tag" scheme, sponsored by the Camelot national government, for certifying organic foods. Green Tag is the most widely recognized certfication scheme in Camelot, but unfortunately the certification standard is lower than that imposed by the Harvest Association (it permits the use of pesticides, herbicides and chemical fertilizers, so long as testing reveals no trace of these products in finished produce). There have also been some reports of cheating and corruption in the scheme.
Nonetheless, Alan Anderson has a strong interest in pursuing a supply contract with Springtime Coop for vegetables to be served by F&N. He has asked you to visit the coop and begin negotiations for a joint venture agreement. Before your departure for Camelot, your team was given the following instructions:
F&N wants to use vegetables grown by the Springtime Coop in its restaurants, because they are of high quality for the price, and because dealing with a developing country may have a positive impact on F6n7s image over the long term, if the arrangement works out well.
On the other hand, F&N is worried about the generally excessive use of agrochemicals in Camelot, and the impact that this could have on F&N's image and sales if it makes the evening news in Laputa. F&N therefore wants strict monitoring and the power to control agricultural practices at Springtime Coop for all crops. F&N sees this as the only way to establish persuasive proof of the safety of F&N's imports in the event of bad publicity.
In addition to control, F&N is concerned about cost. A supply contract at favorable prices would ease the financial squeeze that F&N expects to experience soon. The ideal result would be a long-term supply contract at modest prices that is terminable immediately in the event of evidence that Springtime Coop foods do not meet F&N's high standards of quality and purity.
For the same reason, in the short term, F&N does not want to include the use of Camelot products in its advertising material, beyond disclosures required by law. Five years of proven good practice would be required to make such a move safe for the company, according to the F&N's Marketing Department.
It is of utmost importance that F&N avoid the use of genetically modified crops. The government of Camelot is known to be negotiating over technology transfer of genetically modified grain and corn seed.
**Sample research links:**

Balance sheet of a typical restaurant:
http://www.sampleplans.com/spv/3259/7.cfm

Report of fakery in the organic food industry:
http://english.people.com.cn/200503/15/eng20050315_176860.html
Report on a scheme in China that is similar to "Green Tag"
http://www.rioa.or.kr/serve/16-8.htm

戻る