Write a 5 page essay on Blood banana: Chiquita in Columbia.Download file to see previous pages... 50 employees of Chiquita had already been killed to signal what would befall the company if it continu

Write a 5 page essay on Blood banana: Chiquita in Columbia.

50 employees of Chiquita had already been killed to signal what would befall the company if it continued defying the guerrilla demands. Strategic Analysis Industry dynamics Chiquita originally engaged in banana growing, but later shifted from farming activities and focused on profitable and less nature dependent marketing and distribution activities. The company established a long-term relationship with independent banana growers who were to be their source of products. The idea was to avoid risks, including natural disasters, environmental and social problems. The company wanted to transfer every production cost to local producers. However, Chiquita was credited with transforming banana trade by packaging, labeling and transportation by use of refrigerated ships. Value chain Bananas are inexpensive perennial fruits that grow repeatedly from the same root system. However, they were the main products that earned Chiquita’s significant revenues. Bananas grow all around the year and needs to be harvested daily. Once harvested, they were separated into bunches, cleaned, sorted, labeled and packed in cardboard boxes from where they were transported in refrigerated containers to the nearest port and loaded on to refrigerated ships. The cool atmosphere could prevent bananas from ripening as they were transported to their destinations, which included United States of America (USA), China, Russia, and Germany among others. Mostly, they were sold to large supermarket chains that had ripening rooms in which small amount for ethylene gas was introduced to hasten the ripening process. Upon ripening, they were sold as fruits to various customers. Industry attractiveness Banana is a fruit not popular among many people. However, Chiquita’s sought to add value to this product by proper packaging, labeling and transporting it to final consumers. Even though its major markets were in USA and European countries, the company owned and leased large tracks of land in Caribbean lowlands such as Guatemala, Costa Rica, Honduras, Panama, Nicaragua and Ecuador among others where it grew the crop in large scale. This led Chiquita’s to emerge as the world biggest exporter of bananas. Moreover, there were no other major competitors and the company controlled the industry. Global/general environment context Chiquita’s banana business did not operate without some challenges. Although the company was accused of numerous unethical malpractices, it also encountered some legal challenges, particularly with EU imposition of “onerous tariffs” on bananas imported from Latin America. Chiquita’s was widely known of its market influence wherever is had investments. This did not go well with members of the Europe Union who sought to impose barriers to prevent the Chiquita’s from entering their market. In 2004, Chiquita’s Cambodian subsidiary was found by the US courts guilty of paying bribes to terrorist groups in return for protection. This caused the company a fine of USD 25million dollars. Other notable disasters that have faced the company include natural disasters such as plant diseases. Resource requirements Large scale banana farming is both capital and labor intensive investment. Chiquita’s had to employ thousands of people to work in its farms. In addition, more resources were needed to buy and lease large tracks of land. Further, the company had to put more investments on social amenities such as hospitals and schools for those working in its farms.