According to Heizer, Render & Munson there six reasons domestic business operations decide to change to some form of international operation are:
a.Improve the supply chain
Ans.- Fonterra acquired local dairy units across 50 countries and managed to form collaboration and increase sells, availability of products to the consumer.
b.Reduce costs and exchange rate risk
Ans.
c.Improve operations
Ans. Managed to collab with multinational company like Nestle, which manufactures dairy consumer product in various countries.
d.Understand markets
Ans. The aimed of Fonterra’s food service business to developing “out of home eating” market and at the present time the worth revenue is 1 billion. This worldwide business operates in fifty countries with cream, butter, yoghurt, pastries, and beverages. there are many customers include large restaurant chain in the global and also include cafe, airlines, hotel, entertainment venues, workplace and institutions.
e.Improve products
Ans. In the world, Fonterra has provided world largest dairy research facility and registered world’s largest pilot plants. Fonterra has 400 employs which including engineers, scientists and technologist. It has more than 600 patents.
f.Attract and retain global talent
Ans.
Identify an example of each reason (a-f) at Fonterra. Provide justification for each reason
(2 marks each).
Sample Solution