Beverage Partners Worldwide
Beverage Partners Worldwide
The Coke and Nestlé Joint Venture Adventure
A joint veture is a business agreement in which the parties agree to delevop, for a finite time, a new entity and assets by contributing equity. An important joint venture over the years was Coca Cola and Nestlé. They both selled refreshments and they thought to sell the ready-to drink tea called NESTEA. Normally when companies join together is in order to benefit of something the other companies has that your lack off. For example Nestlé was expertise in nutrition, health and wellness. This could have helped the image of Coca Cola to look more self compromised with peoples health and in order to become more ethical with its values. In the other hand Coca Cola had a huge know-how in marketing and distribution and this was what Nestlé needed to increase awareness and promote its products. Finally with both of companies knowledge they could easily rise market share and grow through many countries.
Four years after they terminate with the joint venture and Coca Cola received a 100 year license to use Nestea trademark anywhere. This could had happen due to several reasons like conflicts between both companies. They come from different countries and maybe their management or their decision making clashed when reaching for a decision. It is easy to have problems when two companies join as every company want to make decisions and be the leader of the agreement. Although both companies share risks they also share rewards. Another problem they could arrive was the high investment needed, and as a licesing agreement was not so expensive to invest, Coca Cola decided to achieve one. In return Nestlé will receive a royalty for all the sales. The second time the alliance failed was due to a wrong labelling and information. They selled a product, Enviga, which burned calories but later was found that it didn’t. This consecuently will cause customer disatisfaction and put claims against both companies.
The Coke and Nestlé Joint Venture Adventure
A joint veture is a business agreement in which the parties agree to delevop, for a finite time, a new entity and assets by contributing equity. An important joint venture over the years was Coca Cola and Nestlé. They both selled refreshments and they thought to sell the ready-to drink tea called NESTEA. Normally when companies join together is in order to benefit of something the other companies has that your lack off. For example Nestlé was expertise in nutrition, health and wellness. This could have helped the image of Coca Cola to look more self compromised with peoples health and in order to become more ethical with its values. In the other hand Coca Cola had a huge know-how in marketing and distribution and this was what Nestlé needed to increase awareness and promote its products. Finally with both of companies knowledge they could easily rise market share and grow through many countries.
Four years after they terminate with the joint venture and Coca Cola received a 100 year license to use Nestea trademark anywhere. This could had happen due to several reasons like conflicts between both companies. They come from different countries and maybe their management or their decision making clashed when reaching for a decision. It is easy to have problems when two companies join as every company want to make decisions and be the leader of the agreement. Although both companies share risks they also share rewards. Another problem they could arrive was the high investment needed, and as a licesing agreement was not so expensive to invest, Coca Cola decided to achieve one. In return Nestlé will receive a royalty for all the sales. The second time the alliance failed was due to a wrong labelling and information. They selled a product, Enviga, which burned calories but later was found that it didn’t. This consecuently will cause customer disatisfaction and put claims against both companies.