Entrusted with the task of studying in the strategy and organization of a large French company in detail, we chose the Danone Group as our subject.
Groupe Danone is one of the finest French companies, and we are all witness to its strong presence on French territory as well as worldwide, since the Danone Group is present on all continents of the world (North America, Latin America, Europe West Africa and the Middle East, Eastern Europe and Asia-Pacific).
It specializes in the sale of dairy products, biscuits and mineral water. The Danone Group is one of the greatest leaders on the world food market, a position that it has gained by devoting much effort to research and development and based strong local sales positions which are its main key to success.
Groupe Danone has repeatedly demonstrated that it has successfully adapted to the changing economic and competitive environment, particularly in developing its international market while trying to balance its sales geographically. However, the question we will study is whether the business specialist is now able to deal with the risks generated by the market in a changing global economy, with appropriate changes in its strategy and its organization. How does Danone manage the different risks associated with its business and what means does it employ to limit their influence?
In an attempt to address these issues, we present the company throughout its history, its activities, its results, its organization, its research and development, and investment etc. in the first part. In order to understand the risks facing Groupe Danone, it is important to have an overview of it.
In the second part, the group's strategy will be outlined in an attempt to highlight its strengths and weaknesses, but also by deducting the risks associated with implementing this strategy.
February 25, 1966:
Two glass companies, Verrerie Souchon-Neuvesel and Ice Boussois, announced their merger. The first, whose center of activity lies in the Lyon region, produces bottles, industrial jars, and glassware (glass containers). The second, located in the north, manufactures glass for buildings and automobiles (flat glass). With this merger Boussois-Souchon-Neuvesel (BSN) was created with Antoine Ribous as president, with the aim of responding to market developments and creating a company big enough to compete in the Common Market.
1970: BSN entered the food segment
BSN took control of Evian (which, in addition to Badoit brought Jacquemaire and Fali), Kronenbourg and the European Society of Brewing. The company thus built obvious complementarities between drinks and bottles, baby food and jars and so on. At once BSN became the number one French beer, mineral water and baby foods manufacturer
1973: the largest French food group
After several months of negotiations, BSN and Gervais Danone announced their merger to become the largest French food group.
October 1973: introduction of a new strategy
The Yom Kippur War that broke out between Israel and the Arab countries, and the following oil shock, forced BSN Gervais Danone to divest its glass plate activities which had no real consistency with the food sector, and were less profitable . Its withdrawal from this sector was completed in 1981, with the sale of Boussois. The Group then focused completely on the food segment.
Early 80s: ubiquitous in Europe
As Europe was rapidly developing into a single market of 320 million people, BSN Gervais Danone decided to expand its business to continue its development.
Tags: BSN Gervais Danone, French food group, Groupe Danone,
[...] Food is an area where understanding and respect for local cultures are essential, and collaboration with local actors in the form of partnerships or joint ventures, is very often a prerequisite for successful implantation and development. In Mexico, for example, Danone bought a stake in the company Bonafont, the leader in bottled water in Mexico. The company also executed Joint venture agreements with some local companies such as Argentina Mastellone, the group's largest producer of dairy products in this country. [...]
[...] The strength of the Danone brand supported by advertising efforts helped increase the capillary distribution system that was in place, and locally enabled the Group to record growth in sales volume, thus consolidating its leadership position. ϖ Risks facing the Group's growth strategy. The Group's strategy is to become a leader in every market in which it operates. Against a background of continuing concentration of the food and beverages, this strategy involves the pursuit of external growth through acquisitions or alliances. [...]
[...] Due to an essentially local exchange risk related to export products the scale of Groupe Danone remains very limited. They mainly concern Evian and Volvic, for sales in the United States, the United Kingdom and Japan. ϖ Risks related to competition. The markets where the Group operates are highly competitive markets on which major international and many local actors operate. In Western Europe, the markets where the Group operates are relatively mature markets and the competition to gain market share is particularly intense. [...]
[...] Ownership and Capital of Group Danone The composition of the capital of Groupe Danone shows a strong presence of institutional investors of whom are foreigners, which implies a strong international company. We also note the significant role played by individual shareholders as their share reached 20%. I. With respect to the evolution of Title Danone, we note that the period of the early 2000s was a little difficult in 2001 and - in 2002). However, efforts by the giant food manufacturer allowed it to be better valued on the stock market, because the share price rose in 2003 0.9 but especially in 2005 with a growth of 30%. [...]
[...] ϖ Favor a model of sustainable development The DANONE Way is an original approach that reinforces what has always been the strength of Groupe Danone: economic performance which is inseparable from respect for people and the environment. The DANONE Way should enable the Group to reconcile globalization and proximity while respecting their culture and values. Over the years, DANONE has been formalized in texts, and we now have the Fundamental Social Principles, Principles of Business Conduct, and the Charter of the Environment, Food, Nutrition and Health Charter, Global Policy for the protection of groundwater resources. [...]
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