Strategic Alliance
Report on
A partnership between
Kellogg’s and Wilmar International
This reports summarizes the threat and causes of partnership between the two giant companies named Kellogg’s which is an American multinational food manufacturing company and Wilmar International which is Asia’s leading Agribusiness group.
The Kellogg Company is the second largest food company in the world after Pepsico and the company strongly believes in maintaining a positive brand image towards its customer. In United States, the compound annual growth rate (CAGR) for breakfast cereals was just 0.8% from year 2008 to 2012 while in Asia Pacific region it was 5.7% during the same period. Though Kellogg dominated the market but the overall market for cereals was not stable so Kellogg partnered with Wilmar International in 2012. Wilmar provided infrastructure, supply chain, sales and distribution network while Kellogg provided with products and brand value to enter in lucrative China market.
Wilmar International main product included supply of Palm oil which was cultivated majority in Indonesia. The palm oil industry brought a negative environmental effect to Indonesia and Malaysia. Many developers cut down the virgin forest for palm oil plantation which resulted in fast deforestation and impacted social life of locals as their livelihood was depended on this forest. As a result small organization named sumofUS.org launched a campaign criticizing the partnership between the two firms. Thus Kellogg’s brand image was negatively affected and Wilmar International was criticized as world’s least sustainable corporation by the sumofUS.org organization. The campaign was spread moderately and gained momentum among people. This was not acceptable by Kellogg as its brand image was hampered.
Wilmar International is an important partner for Kellogg’s company so the partnership between the two firms cannot be ignored or terminated. Below are my self-opinion towards the
A partnership between
Kellogg’s and Wilmar International
This reports summarizes the threat and causes of partnership between the two giant companies named Kellogg’s which is an American multinational food manufacturing company and Wilmar International which is Asia’s leading Agribusiness group.
The Kellogg Company is the second largest food company in the world after Pepsico and the company strongly believes in maintaining a positive brand image towards its customer. In United States, the compound annual growth rate (CAGR) for breakfast cereals was just 0.8% from year 2008 to 2012 while in Asia Pacific region it was 5.7% during the same period. Though Kellogg dominated the market but the overall market for cereals was not stable so Kellogg partnered with Wilmar International in 2012. Wilmar provided infrastructure, supply chain, sales and distribution network while Kellogg provided with products and brand value to enter in lucrative China market.
Wilmar International main product included supply of Palm oil which was cultivated majority in Indonesia. The palm oil industry brought a negative environmental effect to Indonesia and Malaysia. Many developers cut down the virgin forest for palm oil plantation which resulted in fast deforestation and impacted social life of locals as their livelihood was depended on this forest. As a result small organization named sumofUS.org launched a campaign criticizing the partnership between the two firms. Thus Kellogg’s brand image was negatively affected and Wilmar International was criticized as world’s least sustainable corporation by the sumofUS.org organization. The campaign was spread moderately and gained momentum among people. This was not acceptable by Kellogg as its brand image was hampered.
Wilmar International is an important partner for Kellogg’s company so the partnership between the two firms cannot be ignored or terminated. Below are my self-opinion towards the