CASE STUDY

GENERAL MILLS AVADHI TONGIA

MANSI GUPTA
MAHENDRA BADIYA
DR. PRAGYA KESHARI RAKESH MAHESHWARI

MBA MM (B)
This case study is about GENERAL

MILLS LTD. was operating in North

America .It was a cereal and snack food

company.

General Mills Limited wanted to expand

its business by integrating globally and

entering foreign markets.

When the company analysed carefully,

they decided to go global because they

were facing global competition with

large MNCs like Kellogg and Nestle .

Company decided to enter into a joint venture

Kellogg's and Nestle.

The company enters the European market through a

50-50 joint venture with Nestle called CEREAL

PARTNERS WORLDWIDE (CPW).

Thereafter they also decided second joint venture

with PepsiCo.

In just three years General Mills Ltd. Became a global

marketing company
Q1. Evaluate the Cereal Partners Worldwide venture from General

Mill’s viewpoint?

a. What benefits is the company seeking /obtaining from the joint venture?

INCREASED
MERCHANDISE
COMPEITITION

TV

By working with

Compared to the
NESTLE, the

The distribution of TV

average consumption
company has the

in Europe was a

in theU.S., the
advantage of having
strong plus for the

average consumption
To market Disney

product.
of cereals in Europe
characters on its

is higher. products.
The withdrawal of the

- Nestlé's extensive

third-placed

distribution network
company increased

the market share by

- Removal of

15%
geographic barriers
market share.
b. What problems might arise, now or in the future, in this venture?

A dispute between

General Mills had to

General Mills and

comply with

Nestle would result in

international quality

severe losses for

standards
General Mills
Nestle and General

Mills operate in

different food

segments.
Q2. Evaluate the same joint venture from Nestle’s viewpoint?

a) What are the benefits to Nestle?

Increased Nestle will be able to

Nestle will be able to

market share
reduce the risk and
achieve its prime

through
share the cost of
objective of being

competitive
production as well as
the leader in

advantage . distribution of new

Nutrition, Health and

product line Business.

 b) What problems could arise?

Revenue

Operations might
Cereal partners

be fail because
worldwide

company might not

products might

get expected
be fail.
revenues

Failure of

Joint venture
Q3. Evaluate the snack food venture from General Mills viewpoint?

a) What are the benefits? b) What are the potential problems?

Geographical expansion.
Failure of the joint venture.
Increase in revenue and parity with

the largest supplier in Europe, i.e.,

Failure to meet international quality

the U.K United Biscuits Holding PLC. standards - Dispersion across different

markets.
Entering a new market

segmentation, e.g., PepsiCo in the

low-cost market-low cost Segment.

06
Investment advantage.

Experienced company.
a) What are the benefits? b) What are the

potential problems?
Geographic expansion.
Geographic diversity -

Increasing sales. Cultural issues.

Q4. Evaluate the

Increase in market
snack food venture
Failure of a joint

share. from PepsiCo’s

venture.
viewpoint?
Entering a new product
Failure of products

category Product
affects goodwill.
diversification.
Compliance with

Addressing new

international

customers .
standards
Q5. What other alternatives could General Mills consider in

expanding its presence in world markets outside North America?

Exporting

Strategic alliance

By merging or acquitition of some local players

Foreign Direct Investments

Than k
yo u!
u !