Ben & Jerry's Stakeholders
Ben & Jerry’s Homemade
Ben & Jerry’s Homemade, which was founded in 1978, becoming the leading distributor that engaging in super-premium ice-cream, frozen yogurt and sorbets across the United States, as well as in selected foreign countries, in supermarkets, grocery stores, convenience stores, franchised Ben & Jerry’s scoop shops and restaurants.
Stakeholder and stockholder’s role and motivation
Stakeholders are the parties that have interests or affected by a corporation. Analyzing Ben & Jerry’s, there potentially exists several stakeholders, including management, employees, customers, suppliers, stockholders, community etc. * Management
Actually speaking, management plays a vital role in the organization and usually …show more content…
acts in self interest theory. * Customers
Ben & Jerry’s have consistently used their brand humor to engage their customers in the serious business of the environment. Besides, they make delicious ice cream in a variety of flavors which commands customer loyalty and encourages experimentation and repeat purchasing. In this circumstance, consumers are even willing to pay a premium for its products because of its quality reputation. The company keeps hold of consumer interest by keeping trying to innovate with new flavors and new concepts, such as its twisted ice cream. * Suppliers
Organizational management even pursuit of social gain to scarify its profit and benefit suppliers.
Moreover, it is really quite beneficial for suppliers that get many opportunities to establish business relationship that provided by Ben & Jerry’s. * Community
As cases mentioned, Ben & Jerry’s possess high reputation that emphasis on socially causes and community. Ben & Jerry's has collaborated with a large number of organizations, including many NGOs. Recently, the company has worked with the World Wildlife Fund and explorer Marc Cornelissen to open the Climate Change College.
In the case, there shows a classic example, which they ingeniously make use of the disposal of wastewater to create value for the local resident, in the meanwhile, achieve win-win target. * …show more content…
Stockholders
Ben and Jerry’s issued three types of shares, which are class A common (CAC), class B common (CBC), and class A preferred (CAP).
Jerry Greenfield, who has 130,000 shares (1.9%) in CAC and 90,000 shares (11.2%) in CBC, is the Chairperson and Director. Ben Cohen, who has 413,173 shares (6.1%) in CAC and 488,486 shares (60.9%) in CBC, is the Vice Chairperson and Director. Ben and Jerry are the biggest stockholders of the company, also they are stakeholders. Business must be profitable to survive and the company must earn high return. So it is no doubt that as the largest shareholders, Ben and Jerry want to make profits to maximum their own wealth. However, as stated in the case, Ben and Jerry also dedicate plenty money and activities to the society. We can know this from the conversation between Cohen and Twst. Cohen said he did not know whether the company can attain a 15 percent increase or the capital spending will be. He apparently expressed that he was not so concerned about the benefit which he could gain from the business. The company doesn't just support major causes, but also helps the community where the business started. It offered a share option deal to the people of Vermont, only allowing the community that had supported the company at the beginning to be the first to benefit from its need to grow and expand. The company has also held drive-in movie evenings at its local factory and projected films onto the factory wall which is very
praiseworthy.
On the other hand, what the stockholders really concern is whether their money is deposited on a no-risk account or not. Henry Morgan, director and dean emeritus of Boston university school of management, holds 5,845 shares of CAC. Despite his concern for Ben & Jerry’s social interests, as a member of the board, he must guarantee the shareholders earn higher return. The motivations of the shareholders are to maximize their interests.
According to the case, it is obvious to know the firm runs the business on the basis of nonprofit oriented policy, which transfers their mission to gain more social gains. However, it is irrelevant with interest of shareholders, failing meeting the shareholders requirement definitely. In order to realize social reputation, Ben & Jerry’s set up many restrictions on corporate control. Therefore, it is reasonable to understand why shareholders are dissatisfied. Shareholders of the company do not care so much about the charitable donations as Ben and Jerry do.
We can know that Ben & Jerry’s Homemade stock-price was much lower than the stock-price of industry portfolio and average market stock price when observing from Exhibit 2. As a company which has great brand name and possesses 45 percent share of the super-premium ice cream market, the returns should be better. We have to admit that compares with some other companies of the same trade, Ben and Jerry’s indeed need pay more attention to enlarge its traction in the international ice cream market and maximize the profit.
Takeover issue
Because of the substantial pressure of competition, declining financial operation of Ben and Jerry’s and lack of money for exploiting the aboard market, plenty of takeover offers was triggered, such as Dreyer’s Grand offered $31(stock) and Unilever bid $36(cash). In my point of view, the current takeover offers are justifiable for Ben & Jerry's.
From the perspective of quantity analysis, it is easy to calculate that stock price of Ben & Jerry’s, which is $20.998 (P/E * Earning/Per-Share). Compared with the bid-prices, it seems fair and feasible. Among the bidders, Unilever provides the highest price, which should be elected by management assuming they stand at the point of shareholders.
However, based on the qualitative analysis, Unilever still have unavoidable problems.. If thinking in a profound level, we will find that some main proposal of Unilever are not unconscionable, at least there are some divergences with Ben and Jerry’s willingness. The most important thing is Unilever will restrict social commitments and interests, which undoubtedly departs from the purpose and mission of Ben and Jerry. They've consistently used their company to contribute the society, just as they said “We believe in milking happy cows and not the planet.” Unilever will also integrate B&J and just retain select members of B&J management team. All of these changes will lead B&J into another way which is different from its original management philosophy. It is too difficult that let Ben and Jerry give up their ideals.
As for, Dreyer’s Grand offers a lower bid-price than Unilever’s, Dreyer's, which has long lusted after Ben & Jerry's, proposed a friendly, all-stock offer that would preserve the South Burlington, Vt., company's unique identity, maintain a presence in Vermont, and offer shareholders an ownership stake in the combined company. All of above can ensure that B&J can reserve most of the initial management philosophy. The all-stock offer can also assure that B&J may take part in the joint venture.
The last issue is concerned on some reasons that B&J is worth to the bidders. First of all, Ben & Jerry’s has successfully held onto its key brand values , which is helpful for acquirer to get horizontal integration, even to some extent, realize diversification.
Secondly, Ben & Jerry’s developed from niche consumers to mass market appeal, expanding market scale to international level. Moreover, this firm get strong organizational culture and influence that be learned by Unilever.
As for Unilever, acquiring Ben & Jerry’s making itself become more competitive advantages. Previously, Ben & Jerry’s acted as a fierce competitor, turning to harmonious group member that will definitely get mutual benefit in certain industry.
--------------------------------------------
[ 2 ]. http://www.fundinguniverse.com/company-histories/Ben-amp;-Jerrys-Homemade-Inc-Company-History.html
[ 3 ]. http://www.valuebasedmanagement.net/faq_shareholder_stakeholder_perspective.html
[ 4 ]. http://en.wikipedia.org/wiki/Ben_%26_Jerry%27s
[ 5 ]. Ben & Jerry's Case Study: Developing Premium Food Brands Through Innovative Marketing, Aug2004, p1-13, 13p;
[ 6 ]. Wills, Amanda. Travel Trade Gazette UK & Ireland, 9/12/2008, Issue 2833, p22-22, 1p, 1
[ 7 ]. Deogun, Nikhil; Hechinger, John. Wall Street Journal - Eastern Edition, 12/03/99, Vol. 234 Issue 109, pA3, 0p, 1 graph
Ben & Jerry’s Homemade, which was founded in 1978, becoming the leading distributor that engaging in super-premium ice-cream, frozen yogurt and sorbets across the United States, as well as in selected foreign countries, in supermarkets, grocery stores, convenience stores, franchised Ben & Jerry’s scoop shops and restaurants.
Stakeholder and stockholder’s role and motivation
Stakeholders are the parties that have interests or affected by a corporation. Analyzing Ben & Jerry’s, there potentially exists several stakeholders, including management, employees, customers, suppliers, stockholders, community etc. * Management
Actually speaking, management plays a vital role in the organization and usually …show more content…
acts in self interest theory. * Customers
Ben & Jerry’s have consistently used their brand humor to engage their customers in the serious business of the environment. Besides, they make delicious ice cream in a variety of flavors which commands customer loyalty and encourages experimentation and repeat purchasing. In this circumstance, consumers are even willing to pay a premium for its products because of its quality reputation. The company keeps hold of consumer interest by keeping trying to innovate with new flavors and new concepts, such as its twisted ice cream. * Suppliers
Organizational management even pursuit of social gain to scarify its profit and benefit suppliers.
Moreover, it is really quite beneficial for suppliers that get many opportunities to establish business relationship that provided by Ben & Jerry’s. * Community
As cases mentioned, Ben & Jerry’s possess high reputation that emphasis on socially causes and community. Ben & Jerry's has collaborated with a large number of organizations, including many NGOs. Recently, the company has worked with the World Wildlife Fund and explorer Marc Cornelissen to open the Climate Change College.
In the case, there shows a classic example, which they ingeniously make use of the disposal of wastewater to create value for the local resident, in the meanwhile, achieve win-win target. * …show more content…
Stockholders
Ben and Jerry’s issued three types of shares, which are class A common (CAC), class B common (CBC), and class A preferred (CAP).
Jerry Greenfield, who has 130,000 shares (1.9%) in CAC and 90,000 shares (11.2%) in CBC, is the Chairperson and Director. Ben Cohen, who has 413,173 shares (6.1%) in CAC and 488,486 shares (60.9%) in CBC, is the Vice Chairperson and Director. Ben and Jerry are the biggest stockholders of the company, also they are stakeholders. Business must be profitable to survive and the company must earn high return. So it is no doubt that as the largest shareholders, Ben and Jerry want to make profits to maximum their own wealth. However, as stated in the case, Ben and Jerry also dedicate plenty money and activities to the society. We can know this from the conversation between Cohen and Twst. Cohen said he did not know whether the company can attain a 15 percent increase or the capital spending will be. He apparently expressed that he was not so concerned about the benefit which he could gain from the business. The company doesn't just support major causes, but also helps the community where the business started. It offered a share option deal to the people of Vermont, only allowing the community that had supported the company at the beginning to be the first to benefit from its need to grow and expand. The company has also held drive-in movie evenings at its local factory and projected films onto the factory wall which is very
praiseworthy.
On the other hand, what the stockholders really concern is whether their money is deposited on a no-risk account or not. Henry Morgan, director and dean emeritus of Boston university school of management, holds 5,845 shares of CAC. Despite his concern for Ben & Jerry’s social interests, as a member of the board, he must guarantee the shareholders earn higher return. The motivations of the shareholders are to maximize their interests.
According to the case, it is obvious to know the firm runs the business on the basis of nonprofit oriented policy, which transfers their mission to gain more social gains. However, it is irrelevant with interest of shareholders, failing meeting the shareholders requirement definitely. In order to realize social reputation, Ben & Jerry’s set up many restrictions on corporate control. Therefore, it is reasonable to understand why shareholders are dissatisfied. Shareholders of the company do not care so much about the charitable donations as Ben and Jerry do.
We can know that Ben & Jerry’s Homemade stock-price was much lower than the stock-price of industry portfolio and average market stock price when observing from Exhibit 2. As a company which has great brand name and possesses 45 percent share of the super-premium ice cream market, the returns should be better. We have to admit that compares with some other companies of the same trade, Ben and Jerry’s indeed need pay more attention to enlarge its traction in the international ice cream market and maximize the profit.
Takeover issue
Because of the substantial pressure of competition, declining financial operation of Ben and Jerry’s and lack of money for exploiting the aboard market, plenty of takeover offers was triggered, such as Dreyer’s Grand offered $31(stock) and Unilever bid $36(cash). In my point of view, the current takeover offers are justifiable for Ben & Jerry's.
From the perspective of quantity analysis, it is easy to calculate that stock price of Ben & Jerry’s, which is $20.998 (P/E * Earning/Per-Share). Compared with the bid-prices, it seems fair and feasible. Among the bidders, Unilever provides the highest price, which should be elected by management assuming they stand at the point of shareholders.
However, based on the qualitative analysis, Unilever still have unavoidable problems.. If thinking in a profound level, we will find that some main proposal of Unilever are not unconscionable, at least there are some divergences with Ben and Jerry’s willingness. The most important thing is Unilever will restrict social commitments and interests, which undoubtedly departs from the purpose and mission of Ben and Jerry. They've consistently used their company to contribute the society, just as they said “We believe in milking happy cows and not the planet.” Unilever will also integrate B&J and just retain select members of B&J management team. All of these changes will lead B&J into another way which is different from its original management philosophy. It is too difficult that let Ben and Jerry give up their ideals.
As for, Dreyer’s Grand offers a lower bid-price than Unilever’s, Dreyer's, which has long lusted after Ben & Jerry's, proposed a friendly, all-stock offer that would preserve the South Burlington, Vt., company's unique identity, maintain a presence in Vermont, and offer shareholders an ownership stake in the combined company. All of above can ensure that B&J can reserve most of the initial management philosophy. The all-stock offer can also assure that B&J may take part in the joint venture.
The last issue is concerned on some reasons that B&J is worth to the bidders. First of all, Ben & Jerry’s has successfully held onto its key brand values , which is helpful for acquirer to get horizontal integration, even to some extent, realize diversification.
Secondly, Ben & Jerry’s developed from niche consumers to mass market appeal, expanding market scale to international level. Moreover, this firm get strong organizational culture and influence that be learned by Unilever.
As for Unilever, acquiring Ben & Jerry’s making itself become more competitive advantages. Previously, Ben & Jerry’s acted as a fierce competitor, turning to harmonious group member that will definitely get mutual benefit in certain industry.
--------------------------------------------
[ 2 ]. http://www.fundinguniverse.com/company-histories/Ben-amp;-Jerrys-Homemade-Inc-Company-History.html
[ 3 ]. http://www.valuebasedmanagement.net/faq_shareholder_stakeholder_perspective.html
[ 4 ]. http://en.wikipedia.org/wiki/Ben_%26_Jerry%27s
[ 5 ]. Ben & Jerry's Case Study: Developing Premium Food Brands Through Innovative Marketing, Aug2004, p1-13, 13p;
[ 6 ]. Wills, Amanda. Travel Trade Gazette UK & Ireland, 9/12/2008, Issue 2833, p22-22, 1p, 1
[ 7 ]. Deogun, Nikhil; Hechinger, John. Wall Street Journal - Eastern Edition, 12/03/99, Vol. 234 Issue 109, pA3, 0p, 1 graph